What Are PCI DSS Compensating Controls?

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The PCI DSS (Payment Card Industry Data Security Standard) guidelines are instrumental to any organization that manages, stores, transmits, or processes customer payment card information. It is a globally recognized and trusted information security standard that provides methods and controls for organizations to use while handling sensitive card details. 

However, due to varied constraints, technical limits, or particular operational requirements, obtaining full compliance can still be difficult for some organizations. This is where compensating controls come into play. 

PCI DSS compliance entails more than 100 pages of requirements. However, Appendices B and C describe the compensating controls and provide ideas for minimizing your risks. Limiting risk also entails being able to limit your scope. When you lack the architecture to meet a requirement, compensating controls assist you in remaining compliant with PCI DSS criteria.

In this blog, we will give you a brief overview of PCI DSS’s compensating controls.

What are PCI DSS Compensating Controls?

Organizations can use PCI DSS compensating controls to meet security standards that cannot be satisfied due to technological challenges or business restrictions. By allowing companies to apply compensatory controls, PCI DSS provides some flexibility or different solutions for mitigating the risk specified in the requirement.

Compensating controls are only valid once an assessor has evaluated them. The effectiveness of these controls is determined by factors such as:

  • what situation it is required in;
  • the perimeter security controls; and,
  • the configuration of the applicable controls.

You must remember that PCI compensating controls are not a quick fix for achieving compliance. You should have a good reason when you don’t implement a control. While these are useful as a stopgap measure, you should try to attain the initially recommended compliance.  

Implementing Compensating Control Measures

Within the PCI DSS 3.2.1 whitepaper, the PCI SSC provides guidelines for establishing alternative security measures or compensating controls. The Council expressly states:

“For each and every compensating control, the Compensating Controls Worksheet must be completed. Additionally, compensating control results should be documented in the RoC in the corresponding PCI DSS requirement section.”

In other words, before any compensating control can be regarded as effective, your organization must analyze the risk associated with the controls and how you intend to manage any risks discovered during the inquiry. Analysis documentation is also required to complete parts of the Report on Compliance (RoC) or the Self-Assessment Questionnaire (SAQ) forms. These are two formal documents used to demonstrate that you are properly processing credit card information and are in compliance with the PCI DSS. They will be required when Qualified Security Assessors do the yearly audit.

The following section will delve into the requirements of PCI DSS’s alternative security control measures.

What are the Requirements of Compensating Controls According to Appendix B?

To create and implement a compensating control, a PCI-compliant organization must meet the conditions listed below:

  1. Meet the objectives and rigor of the original PCI DSS requirements 

To meet these requirements, the compensating control must offer the same level of security as the original control requirement. For example, consider the PCI DSS need to maintain a firewall to protect cardholder data and the organization’s failure to do so. Therefore, they would need a compensating measure to protect cardholder data from attackers and unauthorized user access. The alternative security measure must provide the same level of protection as a firewall.

  1. Provide a degree of security comparable to the original PCI DSS requirement

While this criterion may appear redundant to the first, it focuses on compensating control’s practical implications. If the original requirement is designed to give a specified level of protection and the compensating control cannot match that level of security, an auditor or quality assessor may find the compensating control ineffective. As expressed, compensatory restrictions must be as powerful and effective as the original need.

  1. Be above and beyond other PCI DSS requirements 

To fulfill this requirement, an organization must ensure that if a compensating control is implemented and poses an additional risk, the compensating control must also account for this possibility or risk of being deemed invalid or ineffective. In other words, the compensating control must be more secure and cover more risk ground than simply complying with other PCI DSS requirements.

  1. Be proportionate to the additional risk caused by failing to comply with the PCI DSS requirements

This requirement is frequently over-complicated, although it is basic. If your compensating control replaces one PCI need, it cannot be used to replace any other PCI requirement. In other words, you must only use compensating controls once.

When compensating control is determined to be valid, organizations must document its effectiveness in their context. This documentation should include the following items:

  • List of Restrictions
  • Objectives
  • Risks Identified
  • Definition of Compensating Controls
  • Maintenance

It is vital to ensure you can clearly and successfully answer these questions when adopting compensating controls and justifying them to a QSA.

Now, let’s learn what a compensation control worksheet consists of.

What is Included in the Compensating Controls Worksheet as Given in Appendix C?

The PCI compensating control worksheet is intended for organizations that have completed a risk assessment. To achieve compliance, they must have reasonable business constraints to execute the original controls. It is the duty of your organization to complete this paper. After you have finished it, a Qualified Security Assessor (QSA) can suggest improvements.

The worksheet can be found listed under Appendix C.

CategoryInformation Required
ConstraintsEnumerate the constraints that prevent you from meeting the initial demand.     
ObjectivesDefine the original control’s objective; identify the compensating control’s objective.     
Identified RisksDetermine any extra risks caused by the original control’s absence.
Definition of Compensating ControlsDefine the compensating controls and explain how they address the original control’s objectives and the additional risk, if any.   
Validation of Compensating ControlsDescribe the validation and testing of compensating controls.
MaintenanceDefine the process and procedures in place to keep compensating controls in place.

Here are some best practices you should keep in mind while filling out this worksheet:

  • In your reasons, avoid using bad or weak arguments. Businesses, for example, frequently claim that they do not want to utilize controls or are impossible to implement. Budget restrictions, time limits for implementation, or a lack of application facility to run it are stronger justifications.
  • Many organizations establish compensating measures but must explain how they intend to maintain their effectiveness and functionality. Documentation lets you gain insight into potential risks and areas where your controls may be ineffective. You can provide deadlines for resolving control test failures.
  • Your compensatory controls, processes, and systems should already be operational. You cannot, for example, make plans and statements such as will do, will implement, has to be examined, still to be added, and so on. Control planning is not the same as control implementation. The compensating worksheet is not your ticket out of compliance; thus, ensure everything mentioned is operational. 

PCI DSS Compliance Readiness with Akitra!

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 the PCI DSS compliance standard, along with other security frameworks like SOC 1, SOC 2, HIPAA, GDPR, ISO 27001, ISO 27701, ISO 27017, ISO 27018, NIST CSF, NIST 800-53, NIST 800-171, FedRAMP, CCPA, 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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