privacy policy

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How startups can ensure CCPA and GDPR compliance in 2021

Data is the most valuable asset for any business in 2021. If your business is online and collecting customer personal information, your business is dealing in data, which means data privacy compliance regulations will apply to everyone — no matter the company’s size.

Small startups might not think the world’s strictest data privacy laws — the California Consumer Privacy Act (CCPA) and Europe’s General Data Protection Regulation (GDPR) — apply to them, but it’s important to enact best data management practices before a legal situation arises.

Data compliance is not only critical to a company’s daily functions; if done wrong or not done at all, it can be quite costly for companies of all sizes.

For example, failing to comply with the GDPR can result in legal fines of €20 million or 4% of annual revenue. Under the CCPA, fines can also escalate quickly, to the tune of $2,500 to $7,500 per person whose data is exposed during a data breach.

If the data of 1,000 customers is compromised in a cybersecurity incident, that would add up to $7.5 million. The company can also be sued in class action claims or suffer reputational damage, resulting in lost business costs.

It is also important to recognize some benefits of good data management. If a company takes a proactive approach to data privacy, it may mitigate the impact of a data breach, which the government can take into consideration when assessing legal fines. In addition, companies can benefit from business insights, reduced storage costs and increased employee productivity, which can all make a big impact on the company’s bottom line.

Challenges of data compliance for startups

Data compliance is not only critical to a company’s daily functions; if done wrong or not done at all, it can be quite costly for companies of all sizes. For example, Vodafone Spain was recently fined $9.72 million under GDPR data protection failures, and enforcement trackers show schools, associations, municipalities, homeowners associations and more are also receiving fines.

GDPR regulators have issued $332.4 million in fines since the law was enacted almost two years ago and are being more aggressive with enforcement. While California’s attorney general started CCPA enforcement on July 1, 2020, the newly passed California Privacy Rights Act (CPRA) only recently created a state agency to more effectively enforce compliance for any company storing information of residents in California, a major hub of U.S. startups.

That is why in this age, data privacy compliance is key to a successful business. Unfortunately, many startups are at a disadvantage for many reasons, including:

  • Fewer resources and smaller teams — This means there are no designated data privacy officers, privacy attorneys or legal counsel dedicated to data privacy issues.
  • Lack of planning — This might be characterized by being unable to handle data privacy information requests (DSARs, or “data subject access requests”) to help fulfill the customer’s data rights or not having an overall program in place to deal with major data breaches, forcing a reactive instead of a proactive response, which can be time-consuming, slow and expensive.

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UK’s NHS COVID-19 app lacks robust legal safeguards against data misuse, warns committee

A UK parliamentary committee that focuses on human rights issues has called for primary legislation to be put in place to ensure that legal protections wrap around the national coronavirus contact tracing app.

The app, called NHS COVID-19, is being fast tracked for public use — with a test ongoing this week in the Isle of Wight. It’s set to use Bluetooth Low Energy signals to log social interactions between users to try to automate some contacts tracing based on an algorithmic assessment of users’ infection risk.

The NHSX has said the app could be ready for launch within a matter of weeks but the committee says key choices related to the system architecture create huge risks for people’s rights that demand the safeguard of primary legislation.

“Assurances from Ministers about privacy are not enough. The Government has given assurances about protection of privacy so they should have no objection to those assurances being enshrined in law,” said committee chair, Harriet Harman MP, in a statement.

“The contact tracing app involves unprecedented data gathering. There must be robust legal protection for individuals about what that data will be used for, who will have access to it and how it will be safeguarded from hacking.

“Parliament was able quickly to agree to give the Government sweeping powers. It is perfectly possible for parliament to do the same for legislation to protect privacy.”

The NHSX, a digital arm of the country’s National Health Service, is in the process of testing the app — which it’s said could be launched nationally within a few weeks.

The government has opted for a system design that will centralize large amounts of social graph data when users experiencing COVID-19 symptoms (or who have had a formal diagnosis) choose to upload their proximity logs.

Earlier this week we reported on one of the committee hearings — when it took testimony from NHSX CEO Matthew Gould and the UK’s information commissioner, Elizabeth Denham, among other witnesses.

Warning now over a lack of parliamentary scrutiny — around what it describes as an unprecedented expansion of state surveillance — the committee report calls for primary legislation to ensure “necessary legal clarity and certainty as to how data gathered could be used, stored and disposed of”.

The committee also wants to see an independent body set up to carry out oversight monitoring and guard against ‘mission creep’ — a concern that’s also been raised by a number of UK privacy and security experts in an open letter late last month.

“A Digital Contact Tracing Human Rights Commissioner should be responsible for oversight and they should be able to deal with complaints from the Public and report to Parliament,” the committee suggests.

Prior to publishing its report, the committee wrote to health minister Matt Hancock, raising a full spectrum of concerns — receiving a letter in response.

In this letter, dated May 4, Hancock told it: “We do not consider that legislation is necessary in order to build and deliver the contact tracing app. It is consistent with the powers of, and duties imposed on, the Secretary of State at a time of national crisis in the interests of protecting public health.”

The committee’s view is Hancock’s ‘letter of assurance’ is not enough given the huge risks attached to the state tracking citizens’ social graph data.

“The current data protection framework is contained in a number of different documents and it is nearly impossible for the public to understand what it means for their data which may be collected by the digital contact tracing system. Government’s assurances around data protection and privacy standards will not carry any weight unless the Government is prepared to enshrine these assurances in legislation,” it writes in the report, calling for a bill that it says myst include include a number of “provisions and protections”.

Among the protections the committee is calling for are limits on who has access to data and for what purpose.

“Data held centrally may not be accessed or processed without specific statutory authorisation, for the purpose of combatting Covid-19 and provided adequate security protections are in place for any systems on which this data may be processed,” it urges.

It also wants legal protections against data reconstruction — by different pieces of data being combined “to reconstruct information about an individual”.

The report takes a very strong line — warning that no app should be released without “strong protections and guarantees” on “efficacy and proportionality”.

“Without clear efficacy and benefits of the app, the level of data being collected will be not be justifiable and it will therefore fall foul of data protection law and human rights protections,” says the committee.

The report also calls for regular reviews of the app — looking at efficacy; data safety; and “how privacy is being protected in the use of any such data”.

It also makes a blanket call for transparency, with the committee writing that the government and health authorities “must at all times be transparent about how the app, and data collected through it, is being used”.

A lack of transparency around the project was another of the concerns raised by the 177 academics who signed the open letter last month.

The government has committed to publishing data protection impact assessments for the app. But the ICO’s Denham still hadn’t had sight of this document as of this Monday.

Another call by the committee is for a time-limit to be attached to any data gathered by or generated via the app. “Any digital contact tracing (and data associated with it) must be permanently deleted when no longer required and in any event may not be kept beyond the duration of the public health emergency,” it writes.

We’ve reached out to the Department of Health and NHSX for comment on the human rights committee’s report.

Let’s go through Matt Hancock’s letter to @HarrietHarman @HumanRightsCtte on the NHSX app and take a closer look at some of these statements 1/ https://t.co/sQe2U8wkiy

— Michael Veale (@mikarv) May 7, 2020

There’s another element to this fast moving story: Yesterday the Financial Times reported that the NHSX has inked a new contract with an IT supplier which suggests it might be looking to change the app architecture — moving away from a centralized database to a decentralized system for contacts tracing. Although NHSX has not confirmed any such switch at this point.

Some other countries have reversed course in their choice of app architecture after running into technical challenges related to Bluetooth. The need to ensure public trust in the system was also cited by Germany for switching to a decentralized model.

The human rights committee report highlights a specific app efficacy issue of relevance to the UK, which it points out is also linked to these system architecture choices, noting that: “The Republic of Ireland has elected to use a decentralised app and if a centralised app is in use in Northern Ireland, there are risks that the two systems will not be interoperable which would be most unfortunate.”

Professor Lilian Edwards, a legal expert from Newcastle University, who has co-authored a draft bill proposing a set of safeguards for coronavirus apps (much of which was subsequently taken up by Australia for a legal instrument that wraps public health contact info during the coronavirus crisis) — and who also now sits as an independent advisor on an ethics committee that’s been set up for the NHSX app — welcomed the committee report.

Speaking in a personal capacity she told TechCrunch: “My team and I welcome this.”

But she flagged a couple of omissions in the report. “They have left out two of the recommendations from my bill — one of which, I totally expected; that there be no compulsion to carry a phone. Because they will just be assumed within our legal system but I don’t think it would have hurt to have said it. But ok.

“The second point — which is important — is the point about there not being compulsion to install the app or to display it. And there not being, therefore, discrimination against you if you don’t. Like not being allowed to go to your workplace is an obvious example. Or not being allowed to go to a football game when they reopen. And that’s the key point where the struggle is.”

The conflict, says Edwards, is on the one hand you could argue what’s the point of doing digital contact tracing at all if you can’t make sure people are able to receive notifications that they might be a contact. But — on the other — if you allow compulsion that then “leaves it open to be very discriminatory” — meaning people could abuse the requirement to target and exclude others from a workplace, for example.

“There are people who’ve got perfectly valid reasons to not want to have this on their phone,” Edwards added. “Particularly if it’s centralized rather than decentralized.”

She also noted that the first version of her draft coronavirus safeguards bill had allowed compulsion re: having the app on the phone but required it to be balanced by a proportionality analysis — meaning any such compulsion must be “proportionate to a legitimate aim”.

But after Australia opted for zero compulsion in its legal instrument she said she and her team decided to revise their bill to also strike out the provision entirely.

Edwards suggested the human rights committee may not have included this particular provision in their recommendations because parliamentary committees are only able to comment on evidence they receive during an inquiry. “So I don’t think it would have been in their remit to recommend on that,” she noted, adding: “It isn’t actually an indication that they’re not interested in these concepts; it’s just procedure I think.”

She also highlighted the issues of so-called ‘immunity passports’ — something the government has reportedly been in discussions with startups about building as part of its digital coronavirus response, but which the committee report also does not touch on.

However, without full clarity on the government’s evolving plans for its digital coronavirus response, and with, inevitably, a high degree of change and flux amid a public health emergency situation, it’s clearly difficult for committees to interrogate so many fast moving pieces.

“The select committees have actually done really, really well,” added Edwards. “But it just shows how the ground has shifted so much in a week.”

This report was updated with additional comment

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Osano makes business risk and compliance (somewhat) sexy again

A new startup is clearing the way for other companies to better monitor and manage their risk and compliance with privacy laws.

Osano, an Austin, Texas-based startup, bills itself as a privacy platform startup, which uses a software-as-a-service solution to give businesses real-time visibility into their current privacy and compliance posture. On one hand, that helps startups and enterprises large and small insight into whether or not they’re complying with global or state privacy laws, and manage risk factors associated with their business such as when partner or vendor privacy policies change.

The company launched its privacy platform at Disrupt SF on the Startup Battlefield stage.

Risk and compliance is typically a fusty, boring and frankly unsexy topic. But with ever-changing legal landscapes and constantly moving requirements, it’s hard to keep up. Although Europe’s GDPR has been around for a year, it’s still causing headaches. And stateside, the California Consumer Privacy Act is about to kick in and it is terrifying large companies for fear they can’t comply with it.

Osano mixes tech with its legal chops to help companies, particularly smaller startups without their own legal support, to provide a one-stop shop for businesses to get insight, advice and guidance.

“We believe that any time a company does a better job with transparency and data protection, we think that’s a really good thing for the internet,” the company’s founder Arlo Gilbert told TechCrunch.

Gilbert, along with his co-founder and chief technology officer Scott Hertel, have built their company’s software-as-a-service solution with several components in mind, including maintaining its scorecard of 6,000 vendors and their privacy practices to objectively grade how a company fares, as well as monitoring vendor privacy policies to spot changes as soon as they are made.

One of its standout features is allowing its corporate customers to comply with dozens of privacy laws across the world with a single line of code.

You’ve seen them before: The “consent” popups that ask (or demand) you to allow cookies or you can’t come in. Osano’s consent management lets companies install a dynamic consent management in just five minutes, which delivers the right consent message to the right people in the best language. Using the blockchain, the company says it can record and provide searchable and cryptographically verifiable proof-of-consent in the event of a person’s data access request.


“There are 40 countries with cookie and data privacy laws that require consent,” said Gilbert. “Each of them has nuances about what they consider to be consent: what you have to tell them; what you have to offer them; when you have to do it.”

Osano also has an office in Dublin, Ireland, allowing its corporate customers to say it has a physical representative in the European Union — a requirement for companies that have to comply with GDPR.

And, for corporate customers with questions, they can dial-an-expert from Osano’s outsourced and freelance team of attorneys and privacy experts to help break down complex questions into bitesize answers.

Or as Gilbert calls it, “Uber, but for lawyers.”

The concept seems novel but it’s not restricted to GDPR or California’s upcoming law. The company says it monitors international, federal and state legislatures for new laws and changes to existing privacy legislation to alert customers of upcoming changes and requirements that might affect their business.

In other words, plug in a new law or two and Osano’s customers are as good as covered.

Osano is still in its pre-seed stage. But while the company is focusing on its product, it’s not thinking too much about money.

“We’re planning to kind of go the binary outcome — go big or go home,” said Gilbert, with his eye on the small- to medium-sized enterprise. “It’s greenfield right now. There’s really nobody doing what we’re doing.”

The plan is to take on enough funding to own the market, and then focus on turning a profit. So much so, Gilbert said, that the company is registered as a B Corporation, a more socially conscious and less profit-driven approach of corporate structure, allowing it to generate profits while maintaining its social vision.

The company’s idea is strong; its corporate structure seems mindful. But is it enough of an enticement for fellow startups and small businesses? It’s either dominate the market or bust, and only time will tell.

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Pokemon Go T&Cs strip users of legal rights

The Pokemon "Pikachu" is seen at the amusement park in Tokyo, July 13, 2016. (Photo by Hitoshi Yamada/NurPhoto via Getty Images) Players of Pokemon Go are not only giving up their right to act like sane human beings in public, as they walk around, zombie-esque, reaching into the phones held in front of their faces, they are also likely to be waiving legal rights if they don’t take a very close look at Niantic Labs’ Terms of Service for the game. Read More

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