UK GDPR divergence: what SaaS vendors must know

Since Brexit, the UK's data protection framework has begun to diverge from the EU GDPR. For SaaS vendors serving both markets, understanding these emerging differences is crucial for maintaining compliance and navigating the evolving regulatory landscape.

Key Areas of UK GDPR Divergence

While the UK GDPR was initially closely aligned with EU GDPR, the UK government has introduced several reforms that signal growing divergence. SaaS vendors must navigate these differences carefully to maintain compliance in both jurisdictions.

1. International Data Transfers

The UK has established its own adequacy decisions that differ from the EU's list. Notably, the UK has deemed adequate several countries not recognized by the EU, including:

• South Korea (ahead of the EU)
• The UK-US Data Bridge (similar to but legally distinct from the EU-US Data Privacy Framework)
• Additional countries under consideration that may not align with EU adequacy findings

SaaS vendors must implement distinct transfer mechanisms for EU and UK data when transferring to non-adequate third countries.

2. Cookie Consent Requirements

The UK is exploring a more flexible approach to cookie consent than the EU, potentially allowing certain analytics cookies without explicit consent. This would differ significantly from the EU's strict consent requirements under the ePrivacy Directive.

3. Data Subject Rights Handling

The UK has introduced a nominal fee for handling certain complex data subject requests, while such fees remain prohibited under EU GDPR. Additionally, UK organizations may have more flexibility to refuse "vexatious" requests.

4. Legitimate Interests Assessment

The UK is developing a more business-friendly approach to legitimate interests processing, with potential reforms creating a list of "recognized legitimate interests" requiring less documentation than the EU's approach.

Implementation Guide for SaaS Vendors

For SaaS vendors operating in both the UK and EU markets, these divergences necessitate a strategic approach:

1. Documentation Updates

• Separate Privacy Notices: Maintain UK-specific and EU-specific privacy notices that reflect the nuanced differences in data subject rights and processing activities.
• Dual Data Transfer Mechanisms: Implement and document separate data transfer mechanisms for UK and EU data, especially when using UK-specific adequacy decisions.
• Bifurcated DPIAs: Conduct separate Data Protection Impact Assessments for UK and EU operations, reflecting the differing risk assessment frameworks.

2. Technical Measures

• Data Segregation: Consider implementing data segregation between UK and EU customer data to apply jurisdiction-specific rules more easily.
• Dual Cookie Solutions: Deploy different cookie consent mechanisms for UK and EU users, particularly if the UK adopts more flexible consent requirements.
• Rights Management Portal: Develop nuanced systems for handling data subject requests that can apply UK or EU requirements based on user location.

Practical Application: A Timeline for SaaS Vendors

Given the ongoing and incremental nature of UK GDPR reforms, SaaS vendors should adopt a phased approach:

• Immediate: Audit existing transfers and implement UK-specific SCCs for non-adequate country transfers.
• Near-term (3-6 months): Update privacy notices and internal documentation to reflect the divergent approaches.
• Medium-term (6-12 months): Implement technical measures for data segregation and jurisdiction-specific processing.
• Ongoing: Establish a monitoring system for tracking further divergence and implementing changes in an agile manner.

Conclusion

While UK and EU data protection regimes share common foundations, the increasing divergence requires SaaS vendors to implement nuanced approaches to compliance. By recognizing these differences early and implementing flexible systems capable of applying jurisdiction-specific rules, SaaS vendors can navigate this complexity while maintaining strong data protection standards across both markets.