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In today's digital age, companies of all sizes collect vast amounts of data about their customers and employees. However, given the increasing importance of data protection laws, companies must ensure that all types of data are processed lawfully and responsibly. One of the most important aspects of this is the conclusion of a data processing agreement.
Drafting a data processing agreement from scratch can be a difficult task, particularly for smaller companies or start-ups with limited legal resources. In this case, a template for a data processing contract can be very helpful. Below, we provide you with a template for a data processing agreement that allows you to ensure that your data processing practices comply with applicable data protection and privacy laws.
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What is a Data Processing Agreement (DPA)?
A data processing agreement is a contract that regulates the processing of personal data by a third-party processor acting on behalf of a data controller.
- The data controller is the organization responsible for determining the purposes and methods of processing personal data.
- The data processor is the organization responsible for carrying out the processing on behalf of the controller.
The primary purpose of a GDPR is to ensure that personal data is processed in accordance with applicable data protection laws and regulations. It also specifies the responsibilities and obligations of both the data controller and the data processor to protect the privacy of data subjects.
The following are common business services and scenarios that require DPAs:
- Subsidiaries
- B2B companies
- Financial institutions
- Internet marketer
- Providers of medical services
- Online retailer
- Providers of online services
- Professional service companies
- Technology companies
Why Are Data Processing Agreements So Important?
A data protection authority is crucial when it comes to taking appropriate security measures and ensuring that data processing activities are compatible with the GDPR. Here are a few key points to keep in mind:
- Signing a DPA is required when the processing of customer data is outsourced to a third-party company, such as a cloud service.
- The DPA document guarantees that the third-party processor ensures information security, prevents security incidents, and complies with all applicable data protection laws.
- Virtually every company depends on third parties to process personal data, whether it's using website analytics software or storing data with a cloud storage provider.
- A data processing agreement with each of these services is an essential requirement for GDPR compliance.
- Drafting and signing a DPA with any third party to whom you want to submit a specific set of data for processing is a must for protection in the event of a data security breach.
What Regulations Should Be Included in a DPA?
When drafting a data processing agreement, it is crucial to include specific provisions or clauses that address important aspects of data processing. These clauses provide clear guidelines for handling personal data and ensure that both parties fully comply with relevant data protection laws.
- The subject matter of the agreement: The subject matter of the agreement generally relates to all activities related to the contractual relationship between the partners.
- Scope, duration and nature of the data protection agreement: To ensure compliance with data protection laws, it is important to clearly define how personal data is used and which party is responsible for data processing. As a rule, this responsibility lies with the person responsible for data processing, i.e. in this case with you.
- The persons affected by the data processing (which information is processed): When drafting a data processing agreement, it is important to identify the data subjects whose data is to be processed. These may include categories such as children, bank customers, patients, or website visitors, and affected individuals may fall into several categories.
- Type of data you want to process: When drafting a GDPR, it is important to specify the various categories of data that are to be processed. This may include technical characteristics of the browser, behavioral data about website activity, or IP addresses.
- Data storage: This clause in the GDPR should clearly outline the methods of data storage, including where the data is stored, the measures taken to ensure its security, and the length of storage.
- Data security: This section of the agreement is critical as it outlines the measures that should be taken to protect personal information. The requirements may include using encryption to protect data, implementing access controls to restrict access to sensitive information, and carrying out routine security assessments to identify and address potential vulnerabilities.
- Subcontracting: Determines whether the data processor may commission a third party to carry out processing activities. If subcontracting is permitted, the clause sets out what measures must be taken to ensure compliance by the third party with the provisions of the GDPR.
- Reporting data breaches: It covers the procedures for reporting data breaches, including how quickly the data controller should be informed, what details the notification must include and what steps should be taken to remedy the breach.
- Liability: The following clause sets out who is liable for damage or loss resulting from failure to comply with the provisions of the GDPR. In most cases, the data controller is responsible.
- Termination: In this section, it is important to mention that when the contract is terminated, the processor must delete all user data from its databases. You should also state the circumstances that give you the right to cancel the contract, such as the processor's failure to notify you of a data breach or unapproved changes to data processing procedures.
How to Use This DPA template
1. Customizing the DPA template
To tailor the DPA to your organization's specific needs, you must adapt it accordingly. This template usually has empty fields where you can enter your company's information, such as your company name, address, and contact information. You may also need to adjust some provisions in the GDPR to ensure they are consistent with your business needs.
2. Review and revision
Once you've customized the template, it's important to review it thoroughly. Make sure all regulations are clear, concise and relevant to your organization's data processing activities. Also ensure that the document complies with applicable data protection laws and regulations. If you are uncertain about certain aspects, it is always advisable to seek legal advice to ensure that the document meets all requirements.
3. Signing and implementing the DPA
After drafting a compliant DPA, it is time to sign it. Make sure all parties involved have read and understood the terms before signing. Sometimes additional negotiations are necessary before all parties agree to the terms of the document. Once all parties have signed, you should incorporate the DPA regulations into your organization's data processing procedures.
4. Compliance monitoring
Creating a DPA is not a one-time event. As your business evolves and changes, so should your GDPR. Review your compliance with the GDPR regularly to ensure that you comply with the procedures and guidelines outlined in the document. It is also important to regularly review your data protection agreement to ensure that it continues to comply with applicable laws and regulations.
