Startups are global from day one. In today’s increasingly interconnected world, transferring data across borders is the bread and butter of every startup ecosystem. The sharp increase of complex data protection regulation over the last few years has become a burdensome process for smaller actors with limited resources. In this blogpost we have explored the steps startups have to employ in order to successfully navigate cross-border data transfers and scale!

1) Classify the nature of the data: Before transferring data, startups should first determine how sensitive the information is and whether they are dealing with personal or non-personal data, or a mix of both.

2) Determine the legal framework(s): Once the nature of the data has been specified, it is important to identify the legal frameworks that apply in the different countries involved in the data transfer. These ones relate to data protection, privacy and security, and should describe the requirements during a transfer, for example, on how to safeguard data.

3) Determine if the transfer is covered by adequacy regulations: For startups operating in the EU and the UK, adequacy means that the country of destination provides an equivalent level of data protection as the country of origin. Thus, if an adequacy agreement is in place, startups can proceed with the data transfer without the need for additional safeguards, saving them resources and time. 

4) Conduct a risk assessment: When adequacy is lacking, a risk assessment will help identify potential security risks and determine if there are appropriate safeguards in place. The EU’s European Data Protection Board and the UK’s Information Commissioner’s Office have published useful recommendations to guide data controllers and processors.

5) Assess whether it is safe to transfer data: A startup is safe to proceed with data transfer if it determines that it can put in place adequate safeguards to mitigate the challenges identified by the risk assessment.

6) Monitor the data transfer: This includes implementing appropriate security measures to anticipate potential threats, for example, making sure data is not being accessed by unauthorised parties by setting up alerts and conducting regular audits.

7) Keep up with legal changes: As regulation evolves, startups should stay up-to-date on the latest regulatory developments in order to remain compliant. The volatile case of transatlantic data transfers proves that the legal landscape can be subject to significant changes.

8) Designate a data protection officer: This individual should be knowledgeable about data protection, privacy, and security regulations in order to effectively steward the data transfer.

9) Be transparent: Provide comprehensive updates to customers and partners about how their data is being transferred and protected. Transparency builds trust and allows stakeholders to make informed decisions.

10) Seek legal advice: In cases where there is notable regulatory confusion and uncertainty, experts in data protection should be consulted to clarify any ambiguities and assess the specific circumstances that apply to the startup transferring data.

Transferring data across borders is a highly technical and resource-consuming endeavour, especially for smaller actors with fewer resources. Because overly complex regulatory frameworks can undermine entrepreneurial activity and innovation, we ask policymakers to consider startups’ perspectives and work towards adequacy agreements to enable safe data transfers, so that in turn startups can answer consumer demands!