In a world where data is the most precious resource, it is unsurprising to see new data privacy and security laws launched and implemented every other year to protect consumer data from malicious elements on the internet. Consumers are becoming increasingly conscious of data collecting and how it impacts them due to media sources reporting more data scandal stories than before. In light of this, several global compliance standards now promote consumer rights to data privacy and consent. But how do you know which one is right for your organization?
You can start by learning about the two major legislations that geographically cover more than half of the countries in the world. These are the California Consumer Privacy Act (CCPA) which went into effect on January 1, 2020, and is primarily concerned with businesses in the US, and the General Data Protection Regulation (GDPR), which took effect in the EU on May 25, 2018, and is mainly implemented by companies in the European Union (EU) or doing business in EU. These are the first laws to affect mass data gathering, use, and storage immediately after release.
While the GDPR and CCPA have some common characteristics, such as emphasizing transparency and data subject rights, there are also significant disparities in their reach and applicability. No matter where they are located, all organizations that manage the data of EU people must comply with GDPR, which has harsh penalties for non-compliance. However, because of California’s economic clout, the CCPA also targets companies based in California or working with data belonging to people in California, but more in general, the United States.
This is why it is vital to understand the effects of the CCPA and GDPR rules for current and future worldwide compliance. These rules hint at a particular development in data management—that more regulatory organizations will implement privacy and consent laws and harsher penalties for breaking them. This blog will briefly cover the similarities between the GDPR and the CCPA guidelines and detail five of their most notable differences. This article aims to help you understand what each compliance framework demands from your business and, thus, which is right for your organization.
What are the Similarities Between GDPR and CCPA Compliance Guidelines?
Here are some of the most significant similarities between the GDPR and CCPA guidelines:
- Businesses do not have to be geographically situated in the European Union for GDPR laws to apply. Likewise, CCPA guidelines can apply to companies located outside California.
- GDPR and CCPA mandate that companies comply with a consumer’s request for data access.
- As stipulated under GDPR and CCPA, consumers residing in Europe and California can ask organizations to delete their personal information from the latter’s database.
- GDPR and CCPA help build consumer trust in how your business handles consumer data privacy, making them much more likely to be interested in creating a deal with you or purchasing from you.
Now, let’s check out some similarities between the GDPR and CCPA laws, albeit with minute methodological differences. For example:
- Both GDPR and CCPA mandate businesses to attain customer consent, but —
- GDPR requires opt-in consent to share customer information before it can be gathered.
- CCPA requires businesses to provide a “Do Not Sell My Personal Information” option. Moreover, customers can opt out of sharing their information with third parties.
- Regulations under the CCPA and GDPR both have particular guidelines for gathering information from children, but —
- Under GDPR, minors aged below 16 must have parental approval. For certain regions, European Union members may reduce this age to 13.
- Under CCPA, businesses must obtain parental consent from minors under 13 before collecting data.
- For damages —
- GDPR requires ten factors to be considered, namely—intention, mitigation, preventive, history of offenses, cooperation, type of data compromised, notices, certifications, and other mitigating factors—when determining the cost.
- CCPA mandates fees for data breach damages be limited to actual damages, which must be greater, or $100 to $750 per consumer for each event.
- For transparency —
- The GDPR requires you to tell customers—what you do, how to get in touch with you, why you handle personal data, the kinds of data you gather, and how long you plan to keep it—and notify them about data sharing locations.
- The CCPA requires you to tell customers—what types of information you are gathering, why you are collecting this information, and details of the data being collected—and notify them about data-sharing locations.
In the following section, we will discuss the five most notable differences between the GDPR and CCPA compliance standards.
Differences Between GDPR and CCPA Compliance Guidelines
Let’s dive right into them.
- Who does GDPR and CCPA Affect?
GDPR’s rules apply to all organizations and their websites.
Any business that handles personal data from the EU must abide by the GDPR or risk expensive legal penalties, including eCommerce companies, non-profit organizations, and public institutions. This has effects on visitor management and GDPR as well.
Meanwhile, the CCPA only safeguards individuals who are lawfully residing in California, unlike the GDPR, which applies to all data subjects, the identified individuals to whom personal data relates.
Additionally, the CCPA only applies to for-profit organizations whose operations meet at least one of the following criteria:
- Generate an annual gross income greater than $25 million;
- Acquire, purchase, or share the data of more than 50,000 Californians, including visitors to your website from devices, homes, or consumers; or,
- Account for at least 50% of their yearly income by selling such sensitive information.
The company must also be based in California and define the uses and methods for processing personal information obtained from Californian customers to be considered CCPA compliant.
- What Types of Data are Protected Under the GDPR and the CCPA?
No matter what the purpose of the processing is or how it is carried out, the GDPR broadly applies to all personal data processing.
There are just two instances of this rule being broken:
- processing of personal data that is not automated and not going to be filed; and,
- any data processing carried out by people for their own needs.
However, the CCPA is more specific about the data types protected in various scenarios.
For instance, the CCPA only requires enterprises to provide the choice to “opt out” when user information is actively going to be sold or shared. In contrast, the GDPR requires entities to get user agreements with “opt-in” options before accessing their data.
Additionally, in comparison to the GDPR, the CCPA does not offer protection to a broader range of user data types, such as:
- Any information that is currently legally accessible to the general public;
- Medical data that is shielded by the federal Health Insurance Portability and Accountability Act (HIPAA) or California’s Confidentiality of Medical Information Act (CMIA);
- The Driver’s Privacy Protection Act of California protects individual data and related data sets.
Although California-based servicing businesses may find it more difficult to negotiate in this area, they are probably already prepared if they adhere to the GDPR’s tougher rules. The best course of action for a company is to double-check and ensure its procedures comply with the specific regulations of the CCPA.
- What Actions are Considered Under Data Collecting, Processing, and Sale?
Personal data refers to any information that might directly or indirectly identify a person under the GDPR and CCPA. This also applies to the information about your outside visitors and contractors.
However, anonymous data is information that cannot be linked to a specific identity and is not protected by state laws. The terminological parallels stop there, though.
Under GDPR’s definition:
Any operation done on a data subject’s information is believed to constitute the “processing” of personal data. This comprises the initial act of gathering user or visitor data, as well as its structuring, storing, making it accessible to others, and ultimately removing and erasing.
Meanwhile, under CCPA’s definition:
The terminology is split into several separate definitions —
- Personal data may be gathered using any technique referred to as “collecting,” but unlike the GDPR, this alone is not regarded as “processing.”
- Only after data that has previously been gathered is processed further does “processing” take place.
- Any transfer, disclosure, or other communication involving the contents of a data subject’s personal information is referred to as “selling” in this distinct occurrence.
- Most importantly, “selling” here refers to the valuable and deliberate trade of personal user information and doesn’t necessarily imply that any money has changed hands.
- What Information is to Be Provided to Data Subjects?
Though there are some similarities between GDPR and CCPA guidelines when it comes to sharing information with data subjects, i.e., the consumers in question, here are the basic differences —
- No matter the affiliation or purpose of the receiving entity, data subjects must be informed when their information is directly obtained from them and whenever it is shared with that entity.
- Automated systems use user data for profiling every time, and they must be informed how long their data can be stored.
- Additionally, individuals must always be reminded of their right to revoke consent for using previously shared data and the rationale behind the profiling procedures.
Last but not least, under the GDPR, data subjects must get a notification by one month after their data is processed by a third party, along with information on how that third party obtained their data.
Comparatively, CCPA specifications are more cursory.
- Businesses must issue reports informing data subjects when their personal information was acquired, sold, or revealed for business purposes after 12 months.
- Any third parties that have collected the data must also expressly inform the data subjects when they intend to sell the data to another distinct third-party business.
- What are the Penalties Involved for Non-Adherence to GDPR and CCPA Guidelines?
Depending on which number is higher, GDPR financial penalties for non-compliance or data breaches can reach up to €20 million, approximately $24 million, or 4% of the offending company’s annual global turnover from the prior fiscal year.
Administrative taxes are to be levied proportionately across all financial assets of the guilty organization in the case of such payouts. Unbelievably, you can protect your visitor data from GDPR fines if you have a visitor management system.
Here, the CCPA differs considerably from the GDPR because non-compliance isn’t considered sufficient justification for a fine. Instead, penalties are only imposed following a data breach.
When one does occur, all prior infractions pertinent to the breach are considered, and each receives a separate consequence. The following are the maximum fines:
- For unintentional infractions, pay $2,500; for intentional infractions, pay $7,500;
- Pay $100 to $750 in civil damages (consumers who are harmed by a breach have the option of suing the at-fault party on their behalf under the CCPA)
Although the penalties for infractions under the CCPA and the GDPR should not be taken lightly, there is a significant variation in how they are applied. While GDPR is proactive in criticizing a careless business, the CCPA only happens to be reactive.
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Establishing trust is a crucial competitive differentiator when courting new SaaS businesses in today’s era of data breaches and compromised privacy. Customers and partners want assurances that their organizations are doing everything possible to prevent disclosing sensitive data and putting them at risk, and compliance certification fills that need.
Akitra offers an industry-leading, AI-powered Compliance Automation platform for SaaS companies. Using automated evidence collection and continuous monitoring, together with a full suite of customizable policies and controls as a compliance foundation, our compliance automation platform and service help our customers prepare readiness for both the GDPR and the CCPA compliance standards, along with other security frameworks like SOC 1, SOC 2, HIPAA, PCI DSS, ISO 27001, ISO 27701, ISO 27017, ISO 27018, NIST CSF, NIST 800-53, NIST 800-171, FedRAMP, CMMC, and more such as CIS AWS Foundations Benchmark, etc. In addition, companies can use Akitra’s Risk Management product for overall risk management for your company, Trust Center, and AI-based Automated Questionnaire Response product to streamline and expedite security questionnaire response processes delivering huge cost savings. Our compliance and security experts will provide customized guidance to navigate the end-to-end compliance process confidently.
The benefits of our solution include enormous savings in time, human resources, and cost savings, including discounted audit fees with our audit firm partners. Customers achieve compliance certification fast and cost-effectively, stay continuously compliant as they grow, and can become certified under additional frameworks using a single compliance automation platform.
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