What Data Privacy Protection Laws Mean for Your Business

Data privacy, data protection, information privacy, and compliance are all rules that govern how and why data is collected and stored from the concerned parties. Information privacy deals with the confidentiality of personal and private data obtained digitally or otherwise. Data privacy determines what type of information should be safeguarded from a breach. Data protection outlines the general measures put in place to protect data, and compliance serves as the regulatory body.

Most countries in the world have various laws meant to protect the privacy of data subjects. These laws also allow individuals to see the data collected on themselves, as well as know how it’s being used and by whom.

The United States is known for letting each state write its own laws, so long as those laws don’t go against the constitution or defy existing federal legislation. The result is a system where data privacy laws are written and enforced by individual states, such as the CCPA and CPRA in California. On the other hand, the European Union has put in place the world’s most rigid data privacy law, known as the General Data Protection Regulation (GDPR). This law protects every citizen that is part of the European Union.

What Type of Data Should a Business Collect?

A business can collect customer data to better understand its market. It can collect three types of marketing information from you: internal data, competitive intelligence, and marketing research. Internal data consists of information gathered from the customer and prospective customer interests. This includes the customer’s location, buying frequency, how much they spend, satisfaction levels, etc.

Competitive intelligence includes information about your direct business competitors and market dynamics. It helps a business understand why a customer or prospective customer would choose or turn down a product offered by your company or another. Marketing research identifies a gap in the market and provides solutions based on information collected and processed from the customers. This helps a business or organization take advantage of a marketing opportunity.

The information collected is regulated by specific laws whose acronyms are HIPAA, FCRA, FERPA, GLBA, ECPA, COPPA, and VPPA. However, only three states have comprehensive consumer privacy laws: California, Colorado, and Virginia.

Privacy Compliance

Businesses collect large amounts of customer data on a daily basis. This data can be susceptible to hacks and other data privacy risks. These could lead to lawsuits and damage control that cost your business time, money, and reputation. Compliance with data privacy and data security laws ensures that your business is protected in the event of a risk.

People knowingly and unknowingly hand over their data to companies who sell that information to advertisers. The involvement of third parties reinforces the argument on data protection. Personal data might be dangerous in the hands of a person with malicious intent. There are no limits to how the person might use that information for personal gain. This could lead to identity theft, credit card fraud, and leaking of sensitive application information.

Privacy protection statutes set the requirements that corporations and organizations must implement to maintain the integrity of their stored data. The policies ensure that data use is rigorously controlled. Data protection statutes also specify how long businesses are allowed to keep data and how that data is protected during that time. If necessary, data privacy rules might also limit data transmission outside of a specific region.

Importance of Privacy Compliance to Your Business

Investing in a data compliance program could bring you significant returns in the long run. It creates a proper working environment between you and your staff as they better understand the business goals. When employees carry out their jobs according to company expectations, it keeps customers happy. Having a privacy compliance program will also help your case in court in the event of a lawsuit due to risk to customer data.


The future of data privacy protection will be an uphill task due to the rapid increase in online businesses today. However, a study from Rutger’s School of Law states that a company that has made a concerted effort to find and avoid violations of privacy laws will be judged less harshly than one indifferent to privacy compliance.