The German Federal Data Protection Act, also known as the Bundesdatenschutzgesetz (BDSG), is one of the most comprehensive data privacy laws. It closely resembles the GDPR and contains important amendments related to personal data sharing, data privacy, and business data processing.
If your business operates in Germany or you collect data from residents of Germany, you’ll need to be compliant with the German Federal Data Protection Act.
In this guide, we’ll explore the history of the BDSG, which businesses it applies to, what makes it different from the GDPR, and how to stay compliant. Let’s get started!
The German Federal Data Protection Act: A Brief Background
The BDSG was one of the first federal data protection acts in Germany and has been updated with the implementation of the GDPR in 2018. Germany has been ahead of many other countries with regards to data protection and the first BDSG has been around since 1978.
However, even previous versions of this law have principles similar to those of the current GDPR. Both regulations focus on purpose limitation, data usage, data collection consent, and data protection. Ever since it was originally implemented, the BDSG has been amended several times to keep up with modern data processing requirements.
It’s currently implemented by the federal ministry and works to safeguard the right of German citizens to have self-determination over their personal information.
Who Does the German Federal Data Protection Act Apply To?
The BDSG applies to all businesses within the jurisdiction of Germany that deal with the data of German citizens.
The BDSG applies to businesses dealing with consumer “personal data.” The definition of personal data in German Federal Law is very similar to Personally Identifiable Information under the GDPR.
Article 4 of the GDPR considers personal data as “‘any information relating to an identified or identifiable natural person.” If your business meets these requirements, you’ll have to ensure corporate compliance with the German Federal Data Protection Act.
Key Areas of the German Federal Data Protection Act
To comply with the BDSG, you’ll need to ensure data processing, consent management, risk assessments, and handling of data breaches are all aligned accordingly.
Let’s explore the key areas of the BDSG:
Provide Consumer Data Rights
German consumers have special data protection rights under the new German Federal Data Protection Act. These include:
The right to transparency: Consumers have the right to know where their data is being used, how it’s collected, which third parties it’s shared with, and how long it will be retained.
The right to change provided data and erasure: The right to be forgotten is a key part of German data law. You may also be obliged to change data provided by the consumer if they request to make amendments.
Withdrawal of consent: Businesses are required to stop processing when a consumer withdraws consent or objects to data processing.
The right to get data in a presentable format: Unlike most general laws related to data processing, the BDSG requires that you provide consumers with data in an easy-to-read and shareable format.
Follow Data Processing Requirements
If your business processes personally identifiable information or other sensitive consumer data, you’ll need to ensure data is processed legally. You can process personal data if it meets a legal obligation, is necessary to adhere to the terms of a contract, or if it’s carried out in the public interest.
Businesses can also process data based on consumer consent or to protect a consumer’s interests.
If you’re a data processor, you can process data in the legitimate interests of the data controller as long as it complies with consumer consent.
And, one special rule that all German businesses have to follow is that they must notify when transferring data outside of the country.
Conduct Data Risk Assessments
Both the GDPR and the BDSG require businesses to conduct a data protection impact assessment (DPIA) to identify and reduce risk to personal data. When conducting a risk assessment for compliance with the Federal Data Protection Act, you’ll need to do an evaluation when:
Processing systems that involve sensitive personally identifiable information (PII).
Automated data processing risks.
Large-scale data processing.
Data mapping and data profiling systems.
Implementing new technology involved in collecting personal data.
You’ll also need to do risk assessments when there’s a reasonable level of risk involved with a third party, technology, or process.
Follow Data Breach Procedures
Getting hit by a data breach can involve penalties, but not following the right procedures could result in bigger fines. Since 2020, Germany has issued five companies with fines of over 1 million Euros for GDPR violations and many more above 100,000 Euros.
Businesses must report data breaches if it is considered high risk or if it involves financial or health information of any kind.
Here’s what the BDSG says about post-data breach procedures:
You have 72 hours to report a data breach to the relevant data protection authority.
Businesses have to include detailed information about the data breach, including how it was discovered, the causes, and any steps your business has taken to prevent it from happening again.
German data privacy law also requires businesses to notify consumers if their sensitive data is involved in a data breach. Businesses also have to outline steps taken to prevent the data breach.
How to Ensure BDSG Compliance
Like with the CPRA, GDPR, and other data privacy regulations, you’ll need to ensure thorough compliance with BDSG regulations to avoid penalties.
Here are some steps to ensure BDSG compliance:
Conduct Proper Data Mapping
The German Federal Data Protection Act focuses on transparency in processing and also requires businesses to delete consumer data upon request. But if you’re not sure where data is stored and how it’s transferred, your business is at a high risk of non-compliance.
Data mapping helps businesses identify where data is stored and how it’s transferred, so you’ll be able to comply with data deletion requests.
Do Regular Data Audits
Section 26 of the BDSG requires businesses to do data impact assessments under certain conditions. With Captain Compliance, you can outsource your data audits to experts to identify gaps in data processing, storage, and regulatory activities.
Most experts recommend doing data audits at least once a year, although you may need to do more regular risk impact assessments when dealing with sensitive or large-scale consumer data.
Appoint a Data Protection Officer
The BDSG requires businesses with over 20 employees involved in automated data processing to have a DPO. However, it’s always best to have a DPO if you’re dealing with large-scale data or sensitive information.
If it doesn’t make financial sense to hire a full-time data protection officer, you can always outsource compliance to a third-party provider like Captain Compliance.
We have qualified data experts who understand German data regulations and will help your business set up BDSG-compliant systems.
Frequently Asked Questions (FAQs)
When Do I Need to be BDSG Compliant?
You need to comply with the German Federal Data Protection Act if your business deals with the personally identifiable information of German residents. This applies regardless of whether your business has a physical presence in Germany or not.
**Read this article for more personally identifiable information.**
Does GDPR Supercede BDSG?
The GDPR supersedes the BDSG in most cases. If your business is already GDPR compliant, you may not have to adjust for the BDSG. However, there are certain clauses where the BDSG still applies, regardless of the GDPR.
Need to know more about GDPR compliance? This guide will help.
Is GDPR and BDSG Similar?
Yes, the GDPR and BDSG are very similar. However, there are a few key areas of difference.
For example, the BDSG is only applicable to German businesses while the GDPR is applicable to all EU businesses. Additionally, the GDPR as a whole is more broad and simply provides a general framework for countries in the EU, with options to expand upon it more like Germany does.
Lastly, the BDSG requires you to be transparent and notify all transfers outside the country while the GDPR does not explicitly require that.
Is It Mandatory to Do a DPIA for BDSG Compliance?
It’s not mandatory for all businesses to do a DPIA for BDSG compliance. Businesses that have more than 20 employees dealing with automated data processing or those that process large volumes of public data need to conduct a DPIA.
Learn more about what your DPIA should include.
Which Federal Ministry Ensures BDSG Compliance?
The German Federal Data Protection Act comes under the German federal ministry, and violations can lead to significant penalties. There are some cases where the penalties of the BDSG can be harsher than GDPR fines.
Need help with BDSG compliance? Get in touch with Captain Compliance.
How Can Captain Compliance Help You?
Compliance with regional data privacy regulations such as the BDSG can be difficult, especially if your business falls under several local regulations. The good news is that you can let Captain Compliance handle the tricky part of local data compliance.
At Captain Compliance, we help businesses comply with regional data regulations like the BDSG through expert consultations, data, and policy audits.
Book your free consultation today!
