Understanding Data Protection Impact Assessments (DPIAs) in GDPR and Lessons for India's DPDP Act 2023

Organizations are immersed in a vast ocean of personal information in today's data-driven world. While leveraging this data can unlock powerful insights and opportunities, it also brings a significant responsibility: protecting individuals' privacy. A Data Protection Impact Assessment (DPIA) is a crucial process designed to help organizations evaluate how their data processing systems, procedures, or technologies impact individuals' privacy. DPIAs ensure compliance with data protection regulations by identifying and mitigating potential risks. This proactive approach helps organizations minimize the risks associated with data processing, safeguarding personal information, and maintaining public trust.

DPIA under GDPR

Under the General Data Protection Regulation (GDPR), DPIAs are required for processing operations that are likely to result in a high risk to the rights and freedoms of individuals. Here's how DPIA is performed under GDPR:

1. Determine Necessity: Identify if the DPIA is required. Article 35 of the GDPR outlines scenarios where DPIA is mandatory, such as systematic monitoring or processing of sensitive data on a large scale.
2. Describe Processing: Clearly describe the nature, scope, context, and purposes of the processing.
3. Assess Necessity and Proportionality: Evaluate if the data processing is necessary and proportionate to achieve its purposes.
4. Identify Risks: Identify and assess the risks to the rights and freedoms of data subjects, such as the potential for data breaches or misuse of personal data.
5. Mitigate Risks: Identify measures to address and mitigate these risks, ensuring compliance with data protection principles.
6. Consultation: If necessary, consult with the data protection authority (DPA) when risks cannot be sufficiently mitigated.
7. Documentation: Document the entire process, decisions made, and measures implemented to ensure transparency and accountability.

DPIA in Other Privacy Laws

While GDPR is the most well-known regulation mandating DPIAs, other privacy laws also incorporate similar assessments:

• California Consumer Privacy Act (CCPA): While not explicitly requiring DPIAs, CCPA emphasizes the need for businesses to implement reasonable security procedures and practices.
• Brazilian General Data Protection Law (LGPD): LGPD requires impact reports for data protection, similar to DPIAs when processing personal data that presents high risks to data subjects.
• Australian Privacy Principles (APPs): Although not mandatory, the Office of the Australian Information Commissioner recommends conducting Privacy Impact Assessments (PIAs) for projects with significant privacy impacts.

Learnings for DPDP Act 2023 (India)

The Digital Personal Data Protection (DPDP) Act 2023 in India can draw several learnings from GDPR and other privacy laws regarding DPIAs:

1. Mandatory DPIAs for High-Risk Processing: Like GDPR, the DPDP Act could mandate DPIAs for processing activities likely to result in a high risk to data subjects' rights and freedoms.
2. Clear Guidelines and Scenarios: Providing clear guidelines and scenarios where DPIAs are required can help organizations understand when to conduct these assessments.
3. Risk Assessment and Mitigation: Emphasizing the identification and mitigation of data protection risks can ensure robust protection of personal data.
4. Consultation with DPA: Establishing a mechanism for consulting with the Data Protection Authority when high risks are identified and cannot be mitigated.
5. Documentation and Accountability: Mandating proper documentation of the DPIA process to ensure accountability and facilitate compliance checks by the DPA.
6. Public Awareness and Training: Educating businesses and the public about the importance and procedures of DPIAs to foster a culture of data protection.
7. Technology Neutrality: Ensuring that the DPIA requirements are technology-neutral, adapting to evolving technological advancements and data processing practices.

By integrating these practices, the DPDP Act 2023 can create a robust framework for protecting personal data and ensuring privacy compliance in India.

Under clause (c) of Section 10 (2) of the Digital Personal Data Protection Act, 2023 (DPDP Act), the Significant Data Fiduciary shall undertake the DPIA, which shall be a process comprising of the following:

• description of the rights of Data Principals,
• purpose of the processing of their personal data,
• assessment and management of the risk to the rights of the Data Principals, and
• such other matters regarding such process as may be prescribed under DPDPA.

Therefore, it can be safely concluded that DPIA is a mandatory exercise to be carried out by every Significant Data Fiduciary under the enactment. But all kinds of organizations including Micro, Small, and Medium Enterprises (MSMEs), or multinational conglomerates or startups are advised to initiate the process of DPIA.