The appropriate and lawful handling of all types of personal information is of utmost importance in many countries. Each country establishes its own laws, regulations and standards that determine how businesses can collect, store, transfer, and use personal information. The various government mandates help protect customers’ privacy rights, provide citizens with control over their personal data, and build openness and trust between the parties.
At the same time, these data protection laws and regulations directly impact the choice of the CRM software that will store and process personal data. Needless to say that using software that is not legally compliant can lead a business to heavy regulatory fines, huge limitations on its activities and damage to its reputation. Clearly, it is important to seek legal advice to be sure that the CRM platform that a business is going to implement or is already using is compliant with relevant data protection requirements.
Data security laws differ from country to country, and one country’s requirements are often not consistent with other countries in their mandates for the protection of personal information. It is, therefore, crucial to be sure that a business’s software is compliant both with the laws of the country in which the business is located and with the laws of the country in which the business’s customers are based.
Among the most important international data protection laws and regulations businesses should be aware of are:
- General Data Protection Regulation (GDPR) – European Union. This regulation went into effect on May 25, 2018. It specifies guidelines for the collection, storage and processing of personal information of customers for businesses that operate in the European Economic Area (EEA), and also for those outside the EU who deal with citizens of the EEA.
In addition, the law regulates the mechanisms for transferring the personal data of EU citizens to third countries. On July 16, 2020, the Court of Justice for the European Union (CJEU) declared the EU-US Privacy Shield invalid and affirmed that the Standard Contractual Clauses (SCCs) remain a valid transfer mechanism. Simply put, it means that if a business uses CRM or any other software that stores the personal data of EU customers in the US, this software has to rely on the SCCs for data transfers.
- Personal Information Protection and Electronic Documents Act (PIPEDA) – Canada. This act is the primary data protection law that covers all private sector organizations which manage any type of personal information.
- The Privacy Act 1988 (Privacy Act) – Australia. This law regulates the proper collection, management, storage and disclosure of personal information, both in the private and public sectors.
- California Consumer Privacy Act of 2018 (CCPA), Colorado Privacy Act, Utah Consumer Privacy Act and Consumer Data Protection Act (Virginia) – are the four primary laws concerning data protection in the US, as this country does not yet have federal data protection legislation.
In the modern world of international trade, the privacy and security of customer data are crucial for any business. Since data protection regulations are constantly evolving, a business is advised to consult legal counsel that specializes in this field to be certain that the business, its CRM and other software comply with all the government requirements that apply to data security.