Most consumers are pros at telling tiny white lies. Heck, most businesses too. Why? How often have you ticked the box that said, “Yes, I’ve read the terms and conditions”? Now, how many times have you actually read the terms and conditions?
We’re all guilty of neglecting the privacy policies every now and again before using a product, service, or visiting a website – but what does that actually mean for data privacy, and how much data can businesses technically get away with obtaining and processing for business purposes?
As our lives become increasingly intertwined with digital platforms, the stakes for data privacy are higher than ever. As a consumer, you may get away with skimming through the data privacy laws but as a business? Not so much.
In this era of heightened data consciousness, understanding and adhering to data privacy regulations are paramount for businesses, especially SaaS companies. We’re looking at two of the most significant data privacy regulations and what SaaS companies need to know about regulatory compliance. So, what is the difference between CCPA vs. GDPR; here’s the deal.
What is GDPR Compliance?
It’s all fun and games until we get to GDPR. The General Data Protection Regulation (GDPR) is considered one of the strictest data processing and privacy regulations. If you’re a SaaS company subject to GDPR, compliance is non-negotiable. Why? Well, GDPR compliance applies to any entity (regardless of size or geographical location) that offers goods or services to EU citizens or residents, compliance is not a choice; it’s a fundamental requirement.
The primary purpose of the GDPR is to control how websites, companies, and organizations handle personal data. This covers anything from names, e-mail addresses, location data, and browser history. However, getting (and staying) GDPR compliant hinges on many technical requirements, making it essential for organizations to develop and prioritize GDPR best practices for handling data.
In navigating the complexities of GDPR compliance, organizations need to establish a robust foundation built on transparency, accountability, and a profound respect for user privacy. This involves implementing measures such as clear and concise data consent processes, encryption protocols, and regular data protection impact assessments. The GDPR not only mandates compliance but encourages a cultural shift, instilling a commitment to protecting individual rights and fostering a heightened sense of responsibility in data management.
Fortunately, due to the stringent requirements and strict regulations within GDPR, complying with CCPA law doesn’t feel like such a daunting task. However, to ensure you don’t expose your business to any areas of risk or non-compliance, it’s essential to have a good understanding of each law so your specific business can approach its regulatory compliance requirements and the practical differences that exist between them, which brings us to our following law; CCPA.
What is the California Consumer Privacy Act (CCPA)?
CCPA state legislation sets new data privacy rights for California residents. For SaaS companies, this means that The California Consumer Privacy Act (CCPA) could potentially affect how your website may handle the personal information of Californians. Notably, the CCPA is more than just inspired by the GDPR; it’s based on its principles, marking the first comparable data privacy regulation in the United States. To navigate both laws effectively, understanding their core differences is crucial for SaaS companies aiming to meet unique compliance requirements while upholding the highest data protection standards.
What is the Difference Between GDPR and CCPA?
Although CCPA and GDPR have very similar aims, the two separate privacy laws are complete with their own compliance standards and definitions. This means that although you may be CCPA compliant, you’re not off the hook regarding GDPR (and vice versa).
So, how do you know whether you’re subject to CCPA compliance, GDPR compliance, or both? This is where the distinctions between the two become important. The two privacy laws differ regarding who and what it protects, who must comply, and the repercussions of non-compliance.
Who the Two Laws Protect:
One of the most significant differences between the two laws is what it’s set out to protect. For example, the GDPR protects ‘data subjects.’ This is defined as “an identified or identifiable natural person.” In plain terms, good old human beings (granted that they’re an EU citizen or resident). CCPA, on the other hand, is state-specific and protects the rights of consumers, which refers to “a natural person who resides in California.”
The Types of Data They Protect
The GDPR has a broad scope when it comes to data protection and covers all personal data, regardless of what the data is intended for or how it’s processed. Within the scope, there are only two exceptions to the rule;
- non-automated data processing which is personally conducted and not filed.
- any data processing that’s undertaken by individuals for their own personal purposes.
CCPA, however, is a bit more specific on the kinds of data that are protected under different circumstances. Whereas the GDPR clearly states that entities must gain consent with “opt-in” options before being allowed to access any data, CCPA requires businesses to supply an “opt-out” option when user information is going to be actively sold or shared.
The Consequences of Non-Compliance
The two privacy laws also differ in terms of the repercussions of non-compliance. The primary repercussions of GDPR non-compliance is enforced via fines that are enforced by the national data protection authorities in the various EU member states. These penalties can range between 2% and 4% of a company’s global annual turnover or €20 million, whichever is highest. Generally, the severity of each fine is determined by the infringement’s nature, gravity, and duration.
Regarding CCPA fines and penalties, the most significant difference between GDPR and CCPA is that GDPR is more preemptive in reprimanding an irresponsible company, whereas CCPA is entirely reactionary.
CCPA penalties and fines are more lenient and don’t necessarily consider non-compliance a significant reason for handing out fines. Rather, penalties are enforced in the event of a data breach. The maximum fines include the following;
- Unintentional violations: $2,500
- Intentional violations: $7,500
- Damages in civil court: $100 to $750
In summary, while CCPA and GDPR share common privacy goals, their distinct compliance standards require separate considerations. Compliance with one does not exempt from the other, necessitating a nuanced understanding of their differences. Whether protecting ‘data subjects’ globally under GDPR or ‘consumers’ in California under CCPA, tailored strategies are vital. The variations in protected entities, data types, and enforcement mechanisms highlight the need for adaptable practices. From GDPR’s proactive fines to CCPA’s reactionary penalties, businesses must navigate these differences for comprehensive compliance. Decoding these nuances is crucial for robust data security and legal adherence amid evolving privacy regulations.
Who Needs to Comply With the CCPA and GDPR?
CCPA vs. GDPR – who needs to comply? Compliance with the two laws focuses mainly on two core groups; Businesses (CCPA) vs. data controllers (GDPR). The scope for each includes the following.
Businesses (CCPA)
CCPA compliance is mandatory for any entity that classifies (according to the law) as a ‘Business.’ This includes any entity that does business in California and collects consumers’ personal data while also determining the means of processing. In addition, CCPA compliance also applies if a company meets at least one of the following thresholds;
- Has an annual revenue of over $25 million
- Buys, obtains or sells more the personal information of up to 50 000 California residents (or more).
- Derives fifty percent or more of its yearly revenues from the sale of personal information.
It should be noted that public, non-profit entities are exempt from complying with CCPA.
Data controllers (GDPR)
GDPR compliance applies mainly to data controllers. This includes any entity that collects and/or processes data in the EU. Regarding who needs to comply with GDPR, there are no set restrictions regarding the size, profit, public or private. No significant thresholds must be met, nor does the entity need to be situated in a specific jurisdiction. This includes any company, business, organization, and website, regardless of size, shape, and purpose – if you process any data, you are GDPR obliged.
Understanding who needs to comply with CCPA and GDPR involves recognizing the distinct criteria set by each regulation. For CCPA, businesses are obligated to adhere to specific regulations if they operate in California, collecting consumers’ personal data while influencing processing methods. Criteria such as exceeding $25 million in annual revenue or handling the personal information of 50,000 or more California residents determine compliance. Notably, public and non-profit entities are exempt from CCPA obligations. In contrast, GDPR places the compliance burden on data controllers—entities collecting and/or processing data in the EU. Unlike CCPA, GDPR imposes no size, profit, or jurisdictional restrictions, applying to any entity, regardless of its size, structure, or purpose, that processes data within the EU.
Protect Client Data and Your Business Without Breaking a Sweat (or the Law)
Although you may have a high-level understanding of the two laws and what they entail, ensuring that your SaaS company is compliant is another story. Fortunately, it doesn’t have to be as daunting as it sounds. If you’re a SaaS and you’re looking to implement a robust Security Management Policy (IS Policy) that aligns with data privacy laws, our compliance experts are just a click away. Alternatively, get and stay compliant up to 90% faster with Scytale’s automated compliance management. Eliminate GDPR heavy-lifting with streamlined compliance today.
What are the Best Practices for GDPR Compliance?
