UK-specific GDPR compliance: A practical guide

Understanding GDPR in the UK post-Brexit

With the UK now outside the European Union, businesses must recognize that while the GDPR has been retained in the UK through the Data Protection Act 2018, nuances require attention. The Act maintains the fundamental rights of individuals regarding their personal data, emphasizing transparency, accountability, and security. Financial services firms must adapt their practices to align with the UK GDPR and UK-specific regulations, ensuring they protect customer data effectively while complying with legal requirements. 

For detailed guidance, businesses can refer to the Information Commissioner's Office (ICO) website, which provides resources, tools, and support to help organizations comply with data protection laws in the UK.

What are the main principles of the UK GDPR?

The UK GDPR is founded on several key principles, including:

• Lawfulness, fairness, and transparency: Data must be processed lawfully and transparently.
• Purpose limitation: Data should be collected for specified, legitimate purposes, and not processed further in a way incompatible with those purposes.
• Data minimization: Only data necessary for the intended purpose should be collected.
• Accuracy: Data must be kept accurate and up to date.
• Storage limitation: Personal data should not be retained longer than necessary.
• Integrity and confidentiality: Data must be processed securely to protect against unauthorized access.

1. Lawfulness, fairness, and transparency

• Financial Services: Ensure transparent data processing, especially for KYC and AML obligations.
• Marketplaces/E-commerce/Gig Economy: Clearly inform customers how data is used for recommendations and marketing.
• Mobility/Transportation: Address transparency in processing location data for service optimization.

2. Purpose limitation

• Financial Services: Data collected for compliance cannot be repurposed without clear consent.
• Marketplaces/E-commerce/Gig Economy: Limit data use to specific, disclosed purposes like personalized marketing.
• Mobility/Transportation: Ensure location data is used solely for intended services (e.g., route optimization).

3. Data minimization and accuracy

• Across all sectors, collect only the necessary data and keep it accurate to avoid unnecessary risks.

4. Storage limitation

• Implement appropriate retention periods and delete outdated data promptly.

5. Integrity and confidentiality

• Secure data processing, protecting against unauthorized access and breaches.

What rights do individuals have under the UK GDPR?

Individuals have several rights, including:

• Right to access: Individuals can request access to their personal data.
• Right to rectification: They can request correction of inaccurate data.
• Right to erasure: They can request deletion of their data under certain conditions.
• Right to restrict processing: Individuals can request to limit the processing of their data.
• Right to data portability: They can request their data in a structured format to transfer to another service.

Right to object: Individuals can object to the processing of their data in certain circumstances.

Step-by-step compliance checklist

1. Data mapping

Understanding what personal data your business collects, processes, and stores is the first step to compliance. Create a comprehensive data inventory, also known as record of processing activities, that includes all the relevant requirements set out in Article 30 of the UK GDPR, such as:

• Types of personal data processed (e.g., customer names, addresses, financial details);
• Purposes for data processing (e.g., account management, fraud detection);
• Data retention periods;
• Categories of data subjects (e.g., customers, employees);
• Categories of data recipients (e.g., processors)
• Description of technical and organizational security measures in place.

Regularly update your data mapping to reflect any changes in data processing activities.

Sector compliance checklist:

• Financial Services: Include customer and transactional data; identify data processors.
• Marketplaces/E-commerce: Map customer interactions, data collected for transactions and marketing.
• Mobility/Transportation: Document location data flows and associated user data.

2. Lawful basis management

Under the UK GDPR and the UK Data Protection Act 2018, documenting a valid lawful basis for personal data processing in line with Article 6 (and Articles 9 and 10, if the processing involves special category or criminal offense data)  is essential.

If you deem consent to be the most appropriate lawful basis for the processing activity, then implement processes to ensure:

• Consent requests are clear, concise, easily understandable and kept separate from other terms and conditions;
• Consent request requires an active opt-in instead of pre-ticked boxes;
• Consent request has information about your business and any third parties relying on consent;
• Customers can provide or withdraw consent easily;
• Documentation of consent is maintained to demonstrate compliance.

Regularly review consent practices to ensure they align with legal requirements.

If your business processes special category or criminal offense data, keep in mind to document considerations of the requirements of Article 9 or 10 of the UK GDPR and Schedule 1 of the UK Data Protection Act 2018 where relevant.

3. Privacy notices

Financial services businesses must provide clear privacy notices to customers, detailing how their personal data will be used. Ensure your privacy notices include the obligatory information required under Articles 13 and 14 of the UK GDPR, such as:

• The identity of the data controller (your business) and contact details of data protection officer (DPO);
• The purposes for and lawful bases of processing data (e.g., consent, contract, legal obligation); 
• Types and sources of personal data; 
• Recipients of personal data;
• Information about data retention periods and rights of data subjects (e.g., right to withdraw consent and access their data).

Make privacy notices readily accessible to customers, ensuring they understand their rights.

4. Data protection impact assessments (DPIAs)

Conduct DPIAs for any new projects or processing activities that may likely result in high risk to  customer’s rights and freedoms. This process should identify potential risks to personal data and outline measures to mitigate these risks. Document your DPIA process and findings.

5. Breach reporting procedures

Establish clear procedures for reporting data breaches.Pursuant to the UK GDPR , controllers must:

• Notify the Information Commissioner's Office (ICO) within 72 hours of becoming aware of a breach.
• Communicate the breach to affected individuals if it poses a high risk to their rights and freedoms.

Ensure all employees are trained on recognizing and reporting data breaches promptly.

6. Data subject rights management

Establish processes to efficiently log, track and respond timely to a data subject request. Make sure your employees are trained on how to facilitate customers' rights under the UK GDPR, which include:

• Right to be informed and access: Customers have the right to be informed about personal data processing and can request copies of their personal data.
• Right to rectification: Customers can request corrections to inaccurate data.
• Right to erasure: Customers can request deletion of their data under certain circumstances.
• Right to data portability: Customers can request to receive their data in a structured format.

Make sure your business is diligent with performing data subject rights. 

7. Employee training and awareness

Educate employees about UK GDPR compliance and data protection principles. Regular training sessions should cover:

• The importance of data protection.
• How to handle personal data securely.
• Procedures for reporting data breaches and handling customer requests.

Consider implementing annual induction and refresher training and role based training. Fostering a culture of data protection within your organization is vital for maintaining compliance.

8. Third-party data processing agreements

If your financial services firm works with third-party data processors, ensure that you have Data Processing Agreements (DPAs) in place. These agreements should:

• Specify the roles and responsibilities of both parties regarding data processing;
• Cover the key details about the processing, such as subject matter, duration, nature, types of data and data subjects involved; 
• Outline the security measures that must be implemented to protect personal data.
• Include clauses on data breach notifications and compliance with applicable data protection laws.

If your financial services firm works with third-party data processors, ensure that you have Data Processing Agreements (DPAs) in place. These agreements should:

• Specify the roles and responsibilities of both parties regarding data processing;
• Cover the key details about the processing, such as subject matter, duration, nature, types of data and data subjects involved; 
• Outline the security measures that must be implemented to protect personal data.
• Include clauses on data breach notifications and compliance with applicable data protection laws.

What should I do in the event of a data breach?

In the event of a data breach, there are several important steps to take to manage and mitigate the situation effectively. Here’s a practical guide based on best practices and regulatory guidelines:

1. Contain and assess the breach

• Containment: Immediately take steps to contain the breach and prevent further compromise. This might involve disconnecting affected systems from the network, changing passwords, or disabling compromised accounts.
• Initial Assessment: Assess what data has been compromised, the cause and impact of the breach. Determine if the breach is ongoing or if it has been resolved.

2. Assess risk and potential harm

• Identify the individuals who may be affected and the potential risks posed to them, considering the nature of data and its sensitivity. Evaluate potential consequences, such as identity theft, financial loss, or threats to an individual's privacy. 

3. Notify relevant authorities (if necessary)

• If you are a controller subject to the UK GDPR, report the breach to the Information Commissioner’s Office (ICO) within 72 hours if it likely poses a risk to individuals' rights and freedoms.
• If a timely report is not possible, document the reason for the delay and provide as much information as possible about the breach in your initial report.
• If you decide the notification to ICO is not necessary, then make sure to document the reason behind it.

4. Notify affected individuals (if necessary)

• If the breach poses a high risk to individuals’ rights and freedoms, the controller should inform them as soon as possible. Transparency enables them to protect themselves, such as by monitoring their accounts, changing passwords, or being alert to potential phishing attempts.
• Use clear and plain language to explain the breach, its impact and recommended protective steps. 
  

5. Document the breach

• Maintain an internal log to document all breach-related details, even if reporting is not required. Record when and how the breach was discovered, data affected, containment actions, and  communications with  individuals or authorities.
• A thorough record supports incident analysis and enhances future security practices. 

6. Review and update security practices

• Once the immediate response is concluded, analyze the root cause of the breach and take corrective action. This might include tightening access controls, providing additional employee training, or enhancing technical safeguards.
• Regularly review and update data protection policies and procedures to prevent future breaches.

7. Learn from the incident

• Conduct a post-incident review to identify weaknesses in security practices and incident response. Leverage lessons learned to improve risk management, raise privacy awareness, refine response plans, and strengthen business’s overall data security posture.  

Additional tips:

• Notify your insurance provider:  If you have cyber insurance that covers data breaches, notify you provider.
• Seek legal advice:  Data breaches may involve individuals across multiple jurisdictions, so seek legal guidance to ensure regional compliance.  

Conclusion

Compliance with UK GDPR and the UK Data Protection Act 2018 is more than a regulatory obligation for financial services businesses; it is a commitment to safeguarding customer data and fostering trust. By following a structured, step-by-step approach, your organization can effectively manage data protection requirements, protect customer information, and maintain compliance.

For further guidance, businesses can consult relevant authority’s guidance and best practices on data protection and privacy, which offer valuable insights for responsibly managing personal data in the digital age. Adopting these practices will help ensure that your financial services remain compliant and customer-focused in an ever-evolving regulatory environment.

Veriff’s support to customer’s compliance

As a data processor for identity verification services, Veriff is dedicated to empowering our customers, the data controllers, in aligning with GDPR principles. Here are some key elements regarding personal data processing and the best practices Veriff follows:

● Privacy Notice: Veriff provides a detailed Privacy Notice explaining how we handle personal data within our services, supporting our customers' transparency efforts. However, this Notice does not replace the need for controllers to publish their own transparency documentation as required by applicable laws.

● Defined data retention: Personal data collected for service purposes is retained according to fixed terms outlined in customer agreements and internal policies, never kept indefinitely.

● Strong technical and organizational measures: Veriff employs encryption for data at rest and in transit. Our service is certified under ISO/IEC 27001:2022, SOC 2 Type II, and Cyber Essentials, ensuring top-tier data security. Discover more about our security practices on the Security and Compliance page and Veriff’s Trust Center.

● Privacy assessments and team: Our Product Legal and Privacy team works with our data protection officer to conduct data protection impact assessments, proactively addressing risks in our products and services.

● Product GDPR audit: We audit  regularly to confirm Veriff’s service complies with GDPR, showing our commitment to accountability and high data protection standards. Download the audit summary here.

Please note that Veriff does not provide legal advice. This article is provided for informational purposes only. You should always discuss your privacy and data protection operations or issues with a qualified legal counsel or privacy specialists.

UK GDPR FAQ

1. What is the UK GDPR?
The UK GDPR is the United Kingdom's version of the General Data Protection Regulation, enacted through the UK Data Protection Act 2018. It regulates how personal data is collected, processed, stored, and shared by businesses subject to UK GDPR, aiming to provide individuals with greater control over their personal data and ensure robust privacy protections.

2. Who is subject to the UK GDPR?
The UK GDPR applies to any business, whether based in the UK or internationally,  that processes personal data of individuals in the UK, offers goods or services to individuals in the UK or monitors their behavior. This includes businesses, public authorities, and non-profits, especially those in sectors like financial services that may handle sensitive personal data.

3. What is considered personal data under the UK GDPR?
Personal data refers to any information relating to an identified or identifiable individual. This includes names, identification numbers, location data, email addresses, and financial information. Special categories of personal data, such as racial or ethnic origin, political opinions, and health data, are also subject to stricter requirements.