- Data sovereignty considerations include maintaining privacy standards and avoiding foreign data cited by the host country’s government.
- Numerous countries have amended or enacted new laws requiring customer data to be stored in the client’s jurisdiction.
Data sovereignty is the most common term used in the corporate world. But what is it all about and what is its significance? Is it the same as data privacy? These are some of the questions that come to mind, especially for business owners when considering the cost of non-compliance.
With cloud adoption now being a norm, data sovereignty has become an essential legal concern for enterprises of all kinds. Simply put, data sovereignty is all about the laws and governance structures applicable to data from where it is collected.
The great cloud computing surge has also meant that various countries have passed laws and regulations to regulate and control data storage and transfer. Measures of data sovereignty are reflected in these regulations.
In this blog, we’ll be covering the following.
- What is data sovereignty?
- Challenges with data sovereignty and compliance.
- Seven steps that can help develop a data protection strategy.
What is data sovereignty?
Data sovereignty is that information in binary digital form that is subject to the laws of the nation-state where the data is located. The lawful rights of data subjects (individuals whose personal information is being collected, held, or processed) and data protection needs rely on the location where the data is stored. Based on this, firms have various data responsibilities in different locations across the world.
Understanding this concept is essential for two reasons. One, with businesses moving to the cloud, data sovereignty is increasingly becoming challenging. Second, laws surrounding data sovereignty vary from region to region and country to country.
Challenges with data sovereignty and compliance
Many countries impose limitations on the transmission of data outside their country. Furthermore, some nations have enacted privacy laws restricting the disclosure of personal data to third parties. This means organizations doing business in these countries can be prohibited, by law, from transferring their data or sending data to a third-party cloud provider for storage or processing.
Since over 100 countries have enacted laws about who owns the data, things can get confusing. This is especially true for bigger businesses that are more likely to work with data from more than one country.
Some of the most common problems with achieving compliance are:
Changing laws: Data sovereignty is still new, so regulations tend to change quickly as countries learn how to handle new situations. Even though the changes are not always negative, they can still make it hard for businesses to stay flexible.
Costs go up: Laws surrounding data sovereignty can cause operational costs to go up. For example, you might need to give your employees more training to ensure everyone knows the rules they ought to follow. You may also need to change how you collect, store, and use data to ensure you follow all rules and regulations imposed by various countries. Because laws are still evolving quickly, you may have to make changes repeatedly to stay in line.
Business growth: When a business grows beyond its borders, it should be something that can be celebrated. But it makes things harder to understand when it comes to data. The more data a business collects and the places it does business in, the harder it will be to figure out which data sovereignty laws it needs to follow.
Cloud Infrastructure: Cloud infrastructure is often spread over multiple countries, which can cause problems with who owns the data. If you aren’t careful, your cloud deployment could reach countries with different rules about who owns the data. Some data sovereignty rules also proclaim where data can be processed, limiting the cloud services you can use.
Data mobility: To put it simply, data mobility means getting data where and when it is needed. Laws about data sovereignty can make it harder for data to move around. It can make it harder for businesses to transfer data from one country to another. It can also mean you can’t use specific cloud locations or services. There might also be rules about how much data needs to be encrypted while in transit and when it is at rest. This raises questions like how to send data, keep it safe online, and set up and protect a network.
Transparency in technology: To show that you are following data sovereignty laws, you should be ready to explain how you handle sensitive information about your clients.
How to make a data protection strategy that can meet your needs for data sovereignty?
Here are seven steps that you can use:
- Find out which data residency rules apply to your business. Think about them for any place where your business works or has customers.
- Talk to your legal and compliance departments to determine what laws you need to follow.
- Plan for monitoring compliance. You can track when your data leaves the region to manage it and ensure it stays in compliance.
- Develop an essential process for scoping. You can decide if you need a key that protects specific data assets or data that might touch geography. That will let you set up rules to protect data particular to a specific country.
- Please list all the cloud data assets and decide how to organize them. Find the assets that may have compliant data from countries with strict rules.
- Encrypt your data. Service providers will have keys and other tools to do basic encryption. Check if a country has stricter rules about handling certain kinds of data.
- Use the services of your service providers based on your list of restricted data locations.
Make things easy
Businesses that work on a global scale will encounter challenges to ensure the rules are followed in multiple countries. That’s why it’s essential to keep things simple. One way to do this is always to take steps in line with the strictest data protection laws. Following the most stringent rules makes you less likely to get in trouble with local laws.
Taking the strictest approach to data protection and sovereignty rules will also need to make fewer changes to ensure you are following the rules, saving you money.