A data protection impact assessment (DPIA) is a crucial process that helps organizations understand the impact of their data processing systems, procedures, or technologies on individual privacy. The primary goal of a DPIA is to identify and eliminate any risks that could potentially violate compliance regulations. This requirement was introduced by the European Union’s General Data Protection Regulation (GDPR), which came into effect in May 2018. Under the GDPR, companies are mandated to conduct DPIAs before conducting data processing activities that pose high risks to individuals’ rights and freedoms.
Not conducting a DPIA could have severe consequences for organizations. They may face penalties, including fines of up to 2% of their annual global revenue or 10 million euros, whichever is greater. Therefore, it is essential for companies to understand situations that require a DPIA to ensure compliance.
Several situations warrant the need for a DPIA. For example, a bank conducting customer screenings against a credit reference database would require a DPIA. Similarly, a hospital planning to implement a new health information database with patients’ health data must also conduct a DPIA. Additionally, a bus operator preparing to implement on-board cameras to monitor drivers’ and passengers’ behavior would also fall under the scope of a DPIA. However, it is important to note that a DPIA may not be necessary for community doctors processing personal data of their patients if the processing is on a smaller scale and limited to a small number of patients. In cases where it is unclear whether a DPIA is required, conducting the assessment can still be beneficial as it helps organizations comply with data protection laws.
The purpose of a DPIA is considered one of the most important aspects of the GDPR by legal experts. The GDPR aims to give individuals greater control over their personal data and establish uniform data protection rules across Europe. While the GDPR specifically applies to the European Union, many global companies also adopt its terms, including the requirements for DPIAs.
According to the European Commission, a DPIA is mandatory in instances such as an extensive and systematic evaluation of an individual’s personal aspects, including profiling. It is also required when processing sensitive data on a large scale or systematically monitoring public areas on a large scale. These instances highlight the need to assess the potential risks to individuals’ privacy in various contexts.
When conducting a DPIA, there is no prescribed format outlined by the GDPR. This flexibility allows organizations to create an assessment that aligns with their practices and existing frameworks. However, there are some basic steps that companies can follow. First, they need to identify a data processing operation that may have a high risk of affecting an individual’s rights and freedom. Next, they should map the flow of information during the process, including collection, storage, use, and deletion. It is crucial to identify any threats or vulnerabilities to personal data collection and evaluate how to minimize their impact. The outcomes of the DPIA should be documented in a report that is signed by executives, ensuring compliance with guidelines and risk mitigation. It is important to note that DPIAs should be ongoing and consider compliance risks as well as broader risks to the individual’s privacy, such as potential social or economic disadvantages. The DPIA does not need to eliminate all risks, but it should assist companies in documenting and assessing any remaining risks.
Many organizations are familiar with privacy impact assessments (PIAs), which help identify and assess privacy risks throughout the development lifecycle of a data processing program or system. Companies that already use PIAs need to review their processes to ensure compliance with GDPR requirements. By conducting DPIAs before starting data processing programs and continuously assessing risks, organizations can effectively prioritize privacy and compliance while providing individuals with better control over their personal data.