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Last updated on 

May 30, 2022

What are the 7 principles of GDPR? - Data protection principles made easy

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The GDPR framework is a set of requirements that all companies who conduct business in Europe have to comply with. Fundamentally, they were established in May 2018 to protect individuals’ rights and freedoms with respect to the protection of their personal data. However, they were also established to help streamline all data protection laws around Europe. Up until that point, different countries had different requirements which made adhering to all of them, all of the time, far more difficult. Through simplification and provision of just one legal framework, data protection laws became easier to follow.

But what are the principles of the GDPR? There are 7 in all, which we identify and examine here. As a result, we emphasise the positive impact they have and why they matter for business. In doing so, we provide a guide to data protection principles - made easy in comparison to all other GDPR articles. 

The GDPR Principles

These are the 7 principles of the GDPR which direct companies on how to collect and process personal data. Adherence to all 7 is required to stop your company incurring GDPR fines as well as reputational damage should your firm’s compliance be found to be lacking in any way. 

The principles state that personal data shall be: 

  1. “processed lawfully, fairly and in a transparent manner in relation to the data subject”.
    First on the list of GDPR is the principle that data must be collected and processed in a lawful, open manner as well as one that is fair. In practice, this means that personal data cannot be stolen or misappropriated through any illegal means. Additionally, once that data is collected, it cannot be used for illegal purposes. 
  2. “collected for specified, explicit and legitimate purposes and not further processed in a manner that is incompatible with those purposes”.
    This principle states that the data collected by a company from individuals must only ever be used with the purpose for which it was collected. In declaring this, the GDPR protects people from being misled in the initial stages of the data collected process as well as giving them more control over how their personal information is used. 
  3. “adequate, relevant and limited to what is necessary in relation to the purposes for which they are processed”.
    The data minimisation principle states that only the necessary and proper amount of data should be collected by companies. This rule helps protect individuals from companies who may collect personal data, which is not needed by them at the moment in time. 
  4. “accurate and, where necessary, kept up to date; every reasonable step must be taken to ensure that personal data that are inaccurate”.
    Data collected must be accurate - and stored accurately too. To ensure GDPR compliance, companies need to make sure the information held is correct. Not only does this mean companies can rely on that data as trustworthy, individuals gain confidence that any information held on them is truthful. 
  5. “kept in a form which permits identification of data subjects for no longer than is necessary for the purposes for which the personal data are processed”,
    Once data has been collected, the GDPR stipulates that that data cannot be held for an indefinite period of time. However, it does not specify the maximum period of time data can be retained. Instead, it is down to the company to argue what is right and fitting with regards to the specific data held. In fact, it states that “personal data may be stored for longer periods insofar as the personal data will be processed solely for archiving purposes in the public interest, scientific or historical research purposes or statistical purposes”. 

    A good example of this would be a bank keeping personal data about current and past customers. It needs the data to be held for its larger security procedures while the customer still uses the bank, but it is also fitting that it holds it after the customer has switched to competitor. Banks will need to do this for legal reasons. 
  6. “processed in a manner that ensures appropriate security of the personal data, including protection against unauthorised or unlawful processing and against accidental loss, destruction or damage, using appropriate technical or organisational measures”.
    Companies must ensure the security of data held due to this principle. In specifying the requirement for companies to make sure data is protected from outside abuse, the GDPR provides individuals with yet more confidence to part with their personal data in the first place.
  7. Accountability. Lastly, the GDPR sets out its requirement for companies to audit their data collection, data processing and retention procedures. In doing so, it makes firms and the “controller...responsible for’ their processes and procedures. Firms must ensure that those processes are legal. Plus, if any data breaches do occur, a thorough post mortem must be conducted to see how it can be prevented in future as well as reporting it to regulatory authorities.

Why we need the GDPR

Compliance to the GDPR principles is imperative for all companies for several reasons. 

Firstly, data protection laws means that individuals are far more inclined to hand over their data. Without them, individuals will be far less likely to relay personal and sensitive information on themselves. And today, your business is going nowhere if it is not data-driven.

Secondly, the principles make the data more reliable and, as a consequence, worthwhile using. The principles also provide direction on data security so that any data collected is always understood to be accurate. Without reliable, accurate data, any decision made using it could be a mistake due to being ill informed. As a result, there are bigger business risks attached to using data that has not been collected properly or secured once collected. 

Thirdly, and perhaps most cynically, if companies do not comply with the GDPR, they are subject to fines of a large magnitude. 

Data protection principles made easy - GDPR essentials and key takeaways

While the GDPR and adhering to it is not what entrepreneurs dream of doing when they first start a business, it is also very necessary and helpful to society as a whole. The GDPR helps promote data privacy which in turn helps uphold human rights through ethical data collection, data processing and data retention. Without the GDPR and its 7 principles, data can be used and abused for fraudulent or illegal means. 

Business owners without a legal background may find the GDPR framework complicated reading at first, however. As a legal document, it uses complex language at times so that applying the framework to a company may seem intimidating or overwhelming without legal, professional guidance. 

However, technological software, like ours at Contractbook, should not be overlooked as a vital aid in ensuring compliance to these data protection laws. Even those with a legal background and education will find the automation that software at Contractbook provides highly advantageous, particularly with regards to complying with the GDPR. For, while the GDPR can be complicated, it need not be. By breaking down the framework into its individual parts and providing contract automation, we aim to take the complexity out so you can ensure your company’s compliance and avoid those pesky, yet substantial fines. 

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