What are the impacts of LGPD and how can you ensure compliance quickly?
Published on 11/02/2020
Written by Giovanna Lopes
Read in 10 minutes
What are the impacts of LGPD on businesses? How to properly comply? What are the deadlines? If you’re not yet familiar with the subject, now is the time to adapt as quickly as possible.
The General Data Protection Law (LGPD) is the latest legislative requirement, covering both physical and digital data. It mandates the protection of all data under the responsibility of the company or data controller whether related to clients, users, suppliers, or employees.
That’s why we’ve prepared this comprehensive guide to help you understand the consequences of underestimating this new law and how to ensure proper compliance. Learn more!
LGPD was enacted in Brazil to address the growing need for protecting physical and digital data. Law No. 13.709, of August 14, 2018, states in Article 1:
Art. 1 — This law governs the processing of personal data, including through digital means, by individuals or public/private legal entities, aiming to protect fundamental rights of freedom, privacy, and the free development of an individual’s personality.
Article 2 outlines key objectives, such as respecting privacy, fostering economic and technological development, encouraging innovation, upholding human rights, and promoting the free development of personality.
It also aims to strengthen citizens’ rights and provide clearer regulations regarding data collection and usage through explicit consent.
Although it may seem like just another regulation, LGPD is already drawing the attention of business leaders due to its significant implications. Here are some key impacts:
Both implementation and sanctions will have financial impacts. It is recommended that a specialist or a specialized company assist in the compliance process. Regarding sanctions, fines are expected to be substantial in case of non-compliance with the law. Brazilian legislation imposes fines of up to 2% of an organization’s total revenue, limited to R$50 million per violation.
Moreover, in more severe cases, the penalties can be even harsher! The ANPD (National Data Protection Authority) may determine the blocking of personal data involved in the violation until compliance is achieved, or even the deletion of the data in question.
Given this risk, it is essential for companies to conduct a personalized assessment to identify measures and tools that ensure data security against incidents of any nature. Managers should view this cost as a smart investment to optimize the organization’s management.
Information monitoring will also undergo restructuring and require new training for IT professionals to handle and store data effectively. Specifically regarding compliance management, organizations will need to align with this law to ensure adherence to national legislation.
It is also worth noting that Article 48 of the law includes important details regarding the communication of security incidents:
Art. 48. The controller must notify the national authority and the data subject of any security incidents that may pose a risk or significant harm to the data subjects.
The first paragraph of this article also highlights critical aspects such as a reasonable timeframe for reporting, the nature of the personal data affected, information about the individuals involved, and more.
Other key points of the law include:
Consequently, it is expected that new management solutions will already incorporate compliance with the LGPD. These tools must operate transparently and include user consent for data control.
In relation to sales funnels, commonly used in digital attraction strategies, the LGPD will also impact segmentation algorithms for marketing, remarketing, and other actions. Implicit consent will no longer be allowed; all authorization must be clear and explicit.
Users must be informed about how their personal data will be handled. Personal information belongs to the individual and cannot be shared or used without their consent. Consequently, applications such as digital analytics, big data, artificial intelligence, advertising, and digital marketing must operate in compliance with the policies established by the new legislation.
Another critical communication aspect is the relationship with consumers and businesses. There will be no implicit consent for interactions or approaches, and requesting data access authorization will impact companies’ digital marketing strategies.
It is essential for businesses to integrate data managed under the LGPD, ensuring that their systems are robust and aligned with the new requirements. Below are key recommendations for a smoother and faster implementation process.
Plan your implementation. This is the first step for any system upgrade. Evaluate key points of attention, software costs, and other considerations to ensure proper setup. Remember, it’s not enough to simply install a system—it must be correctly configured. Otherwise, you may face sanctions and financial losses in the future.
It is crucial for the organization to assign an employee to oversee the entire process, from implementation to operation and monitoring. This person, known as the data controller, should have knowledge of the organization’s processes, relevant legislation, and technology, particularly information security.
As mentioned earlier, it is likely that a specific role will be created to manage this compliance process once the law is in effect. Even if a specialized company is contracted for this purpose, it is advisable to have an in-house employee dedicated to this matter.
Your team responsible for data management must be trained. Establish new rules, policies, and compliance-focused guidelines to ensure conformity with the LGPD.
Define best practices for secure data usage and processing while safeguarding user privacy. Employees in this area will be among the most critical assets during this transition. Article 50 of the law provides guidance on these practices. Specifically, subsection I includes:
I – Implementing a privacy governance program that, at a minimum:
a) Demonstrates the controller’s commitment to adopting internal processes and policies that ensure comprehensive compliance with personal data protection norms and best practices;
b) Applies to all personal data under the controller’s purview, regardless of how it was collected;
c) Adapts to the organization’s structure, scale, and operational scope, as well as the sensitivity of the processed data.
Read the law thoroughly and identify key areas of attention. Delve into the specifics of how the system will function and what programming adjustments will be necessary for proper compliance. If possible, allocate an employee with legal knowledge or consult a lawyer for precise interpretation of the legislative text. The entire law and its amendments must be reviewed.
Conduct a thorough mapping of the processes for data collection, storage, use, transfer, and disposal. Look for ways to improve these processes and align them with the law’s new requirements. Key rules for data collection, use, and processing include:
Implementing intelligent and dedicated management is one of the primary steps for this compliance. Opting for a specialized company can provide access to a skilled team entirely focused on data management.
Technological tools, especially those related to security, will be crucial for compliance. Antivirus software, attack-blocking systems, data backups, and user information management tools will all be essential. If your organization does not yet have a policy focused on this issue, the LGPD will introduce this new perspective to ensure data integrity.
Another critical tip is to consider the trend of cloud computing, which enhances data security and optimizes client data management. Prioritize data-driven management to streamline the administrative process and improve overall business project management.
Regarding security implementation, adopting a privacy-focused policy is vital, including measures such as:
The company’s compliance with the LGPD also involves the implementation of a new role, such as the designation of a professional responsible for data processing. This professional is often referred to as the Data Protection Officer (DPO) in English texts. Let’s take a closer look at what this role entails.
The Data Protection Officer or “DPO” is the title given to the professional responsible for data processing in English. The law allows for the creation of a new, exclusive role for the DPO, which is the acronym representing this function. In other words, it presents a career opportunity for an employee or the possibility of outsourcing.
This type of professional should mainly have the following competencies and skills, according to the law:
§ 2 The activities of the DPO consist of:
I – accepting complaints and communications from data subjects, providing clarifications, and taking appropriate actions;
II – receiving communications from the national authority and taking necessary actions;
III – guiding employees and contractors of the entity regarding the practices to be taken concerning the protection of personal data; and
IV – performing other duties as determined by the controller or established in complementary regulations.
§ 3 The national authority may establish complementary rules regarding the definition and responsibilities of the DPO, including cases where the appointment may be waived, depending on the nature and size of the entity or the volume of data processing operations.
Finally, we must mention the main penalties for those who fail to comply with the LGPD. Neglecting this regulation can bring a series of setbacks to the organization. The impacts of the LGPD primarily affect the financial health of the organization; however, other aspects such as damage to the company’s image and credibility may also occur due to inadequate handling of this issue.
Among the key penalties, we highlight:
As we can see, the sanctions are quite severe for neglecting this important requirement. This underscores the need for swift implementation to ensure such issues do not arise in the future.
A specialized consultancy can assist in this regard. iT.eam has significant advantages in this technology to support business managers in ensuring a successful implementation. Among the key innovation tools, we highlight:
Outsourcing the implementation and management of the LGPD compliance process proves to be a safer and more economical approach, preventing potential inconsistencies during the adaptation. A specialized company will have a team ready to address the topic and take the most appropriate actions to integrate the new functionalities into the company’s current business systems.
If you haven’t yet put this plan into action, now is the time! Ensure credibility, compliance, and trustworthiness in your company with this essential measure to avoid the impacts of the LGPD on your business.
If you aim to accelerate this process and ensure professionalism in the implementation, get in touch with our team right now!
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