Data Science and EU Privacy Regulations: A Storm on the Horizon

Data Science and EU Privacy Regulations: A Storm on the Horizon

Data Science and EU Privacy Regulations: A Storm on the Horizon
In Part 1, we introduced a pending EU privacy and data protection regulation (the GDPR) which will carry fines for violations of up to 5% of global annual turnover (1 million Euros for smaller companies). We discussed how this regulation will present particular challenges for collection, storage, and use of data within EU and global organizations.  Impact will be felt by data scientists in particular but also across the IT organization.   In this post, we focus on the impact on data science and analytic applications and suggest steps to take in the immediate to near future to prevent fines and/or crippling data blackouts.

The GDPR emphasizes the individual’s rights to understand and control how their data are used. The impact of the GDPR for data scientists includes:

1. Ability to collect data. There will be an increased legislation of principles of Privacy by Design/Privacy by Default, which minimize the baseline collection level of data thru systems and processes (think, for example, of browser default settings). Individuals will need to give express consent for what data are collected and will need to be informed as to why the data are being collected.  

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2. Ability to use data. It will become necessary to get express consent for each application of personal data. (Details here are still under debate, and there will likely be certain exceptions).   This could severely impact the ability of data scientists to find new applications for existing data, as those applications will not have been listed in original consent forms. What’s important to note is that there will likely be a grandfathering of current consent.   Thus, it is extremely important to assure that proper consent is in place now.

3. Ability to transfer data to and from third parties. Stiff regulatory fines will certainly produce an environment where corporations are very reluctant to buy, sell or share data that may be personal. In addition, right to privacy/erasure regulation may have strong implications on data sharing (details are still under discussion in the EU parliament).   As a result, expect a drying up of certain data sources.

4. Customer Profiling will be specifically affected by the new regulations. In particular, the customer must be informed when and how data will be used to profile them with material impact (e.g. credit scoring, fraud detection, etc.).

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