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Thursday, May 6, 2021

DRAFT DATA PROTECTION REGULATIONS WAY FORWARD

 

The Office of the Data Protection Commissioner has issued the Draft Data Protection Regulations, 2021. These are meant to give clarity and guidance on compliance with the Data Protection Act, 2019.

The DPA was enacted in November, 2019 in main, give effect to Article 31 of the Kenyan Constitution on the “Right to Privacy.” Its subjects for the most part are Data Controllers and Data Processors.

However, it has been found to be ambiguous and has invited differing interpretations.

Subsequently, there was need to issue regulations to give clarity.

In November, 2020, the Data Commissioner was appointed and immediately embarked on developing Regulations.

In April 2021, the Commissioner issued the Draft Data Protection Regulations, 2021 consisting of:

i.                    The Data Protection (General) Regulations, 2021

ii.                  The Data Protection (Registration of Data Controllers and Data Processors) Regulations, 2021

iii.                The Data Protection (Compliance and Enforcement) Regulations, 2021

The Regulations are currently undergoing public hearings for input and finalization. On 27th April, 2021, the Office of the Data Protection organized a virtual public hearing to discuss the General Regulations.

The General Regulations

These are meant to guide subjects on how to comply with the Act.

i.                    Part I deals with preliminaries like interpretations and exemptions

ii.                  Part II -Enabling the Rights of a Data Subject

 

Part II deals with how entities enable the rights of persons whose data they collect or process.

The DPA grants individual persons with several data subject rights regarding the collection and processing of their personal data which the Regulations spell out: 

The Rights of a Data Subject

Organizations will be required to adhere to the rights of the subject whose data they collect or process. These are covered under Regulations 4-12.

Consent – Regulation no 4 provides that for compliance, a data controller or processor must clearly inform what personal data they are collecting from an individual and for what purposes including whether it shall be handled by third parties. While consent may be oral or written, an entity cannot presume consent because the data subject has not objected or their response is ambiguous.

Obligations:

Entities should ensure they seek consent of the data subject clearly indicating what the data is to be used for and by whom.

 Collection of Data:

Regulation 5 expands the meaning of collection to include availing oneself of the personal data of another person by any means including:

-          From another person

-          From publications and databases

-          Surveillance cameras where one’s features are identifiable

-          Internet cookies from websites

-          Biometrics such as finger, face or voice recognition

Implications:

Organizations or entities will have to formalize any personal data collection activity. This means that even where a subject has willingly brought themselves to a place of business or interaction where any of their personal data may be collected, entities will need to come up with consent documents such as forms clearly indicating that personal data will be collected.

Entities should also beware that subject data that they come across that is not directly submitted by the owner can nonetheless qualify as data collection and is subject to restrictions. Regulation 5b requires that sensitive personal information can only be collected directly from the data subject.

This effectively also prohibits anonymous data collection or tracking of users such as mobile handset users, mobile subscribers, social media platforms such as Google, Facebook etc, websites and so on.

Also, data collected should be used for the purpose stated only. For new uses, fresh consent has to be sought from the subject.

The guidance principles therefore here are:

Data minimization – Entities should only collect necessary data for the purposes stated to the subject.

Data quality – Personal data collected must be accurate.

Data Security – Entities must ensure they secure the data they collect. This applies from collection, storage, and event transfer of data.

 Subjects’ Access to Data – A person should be able to access their personal data held by an entity for free.

The Office of the Data Commissioner provides a form which the subject can fill to request for this information. However, a subject can also make request for access in any other method and the entity should comply with that request.

Right to Restrict Processing – Contained under Regulation 6, a data subject who feels they did not willingly give their personal information, or that their data held by an entity might have errors, or that the time which the entity is allowed to hold the information has expired, can restrict that data from being processed and the entity holding that data must comply.

Right to object to processing – Related to the right to restrict processing, a person can request an entity to stop doing anything with their data. This can be if they believe they never gave consent for the same, or that they feel the entity obtained it illegally, or that the entity has no basis for holding it. This request should be complied with immediately and at no cost.

The same form is used for restriction or objection to processing and is found annexed to the General Regulations.

Rectification – A subject has a right to have their data rectified by the entity that holds it. This could be if they believe the data is misleading or outdated.

The subject will have to show proof that the data is outdated for example by producing an up-to-date Identification Card or Huduma Card.

Data Portability - A subject has a right to have their data ported from one data controller to another such as a mobile operator at minimal cost.

Erasure – Also known as the right to be forgotten, a subject can request a data controller to erase their personal data and upon request the entity shall respond within 14 days.

The ODPC provides Form 5 for this purpose and compliance with the request shall be free of charge.

Right to opt out

A data processor or controller must comply with a request by a subject to opt out of a data collecting process. The option to opt out must be simple, clear, visible e.g. in one word such as UNSUBSCRIBE

Restrictions on Commercial Use of Personal Data

Part III is likely to draw intense interest especially when it comes to compliance with consent or restrictions.

Sending a catalogue addressed to a subject through any medium, advertising on an online platform a subject is logged into using their personal data or data collected via cookies and used to target a subject is deemed cosmmercial use of personal data. So is sending a message about a sale or advertising material using personal data given by the subject.

Direct marketing may be permitted where no sensitive personal data is used but the marketer has collected the personal data from the subject, and the subject has been notified that direct marketing is one of the purposes of the data collection.

In the Covid era, with in-house restaurant dining prohibited and many other retail outlets operating at slowed down pace, online marketing especially through offers sent via SMS to users has been on the rise.

Compliance with this provision then, will require such eateries, online retailers, supermarkets, taxi companies to cease sending unsolicited direct marketing messages to users whose data or contacts they have gathered in the course of doing business.

The Regulations will allow direct marketing only where the recipient has been informed, and has consented to the use of their information for the same.

Obligations of Data controller and Data processor

Concomitant with the rights of a data subject are further obligations to entities that control or process personal data. Contained in Part IV of the General Regulations, these include:

Limitation on retention – Entities should say how long they will hold a subject’s personal data beyond which time they should erase the same.

Requests to anonymize or pseudo-anonymize – Entities should accede to requests to anonymize personal data by a subject.

Sharing of personal data – Entities can share personal data with other entities or third parties provided such request shall be in writing clearly stating the reasons for the data to be shared. A data sharing agreement between the two entities shall be made.

Sharing of such data within an organizational structure of a data controller or data processor shall not be taken data sharing.

Automated individual decision making – Where a data controller or processor uses non-human automated processing of subject data, they should inform the subject of the same, provide the logic or algorithmic process used, explain the significance of doing the same and where large amounts of data are involved, carry out a data impact assessment. They should also ensure the automated process is without errors.

At any point, a subject can seek intervention of a human being.

Data Protection Policy – Data controllers and processors will be required to have in place a Data Protection Policy which must be publicly available. Among other things, the Policy must tell subjects which data they are collecting, how subjects can access their data, the process for handling complaints, how long they intend to hold that data, and whether they collect data on vulnerable people such as children and the criteria used.

Agreements between Data Controllers and Data Processors – Subject to Section 42(2) of the DPA, a data controller can engage a data processor via a written agreement containing theinstructions from the controller to the processor. This could be for example a Mobile Network Operator or a Bank, and an Agent.

Such a processor, should they further wish to engage a third party in the processing activities must obtain the consent of the Data Controller.

Data Localization

Regulation 25 provides that data that is collected and processed for a public good as defined in paragraph (2) of the same, shall be processed through a server and data center located in Kenya. This includes civil registration, revenue administration, schools, national payments systems and so on.

Private data processing therefore is not subject to this requirement. However, the Cabinet Secretary can require such data be processed in Kenya if in the processing, the data is breached or violates the DPA and no rectification measures have been taken by the entity.

Data Protection by Design and by Default

Regulation 26 provides for data protection by design and by default which essentially means that data protection concerns must be integrated into every step of the data processing.

To demonstrate compliance to the Data Commissioner, an entity will need to demonstrate the technical and organizational measures it has taken to ensure for example, data minimization – only the necessary data is collected and processed, pseudo-anonymization, the retention period, accessibility to the data and data sharing restrictions.

Notification of Personal Data Breach

Where sensitive and identifying data held by an entity is breached or unintentionally becomes publicly available or available to unauthorized persons, then a notifiable data breach is deemed to have occurred as per Section 43 of the Data Protection Act.

Such data includes:

-           the subject’s full name or ID number,

-          Bank information

-          Health information

-          Electronic passwords

The entity must notify the Data Commissioner of the data breach within 72 hours of becoming aware of it describing:

-          The date, nature and circumstances of occurrence of the breach

-          Chronology of the entity’s response after they became aware of the breach

-          Number of persons affected and likely harm to them

-          Any action taken to eliminate or mitigate such harm and rectify the cause of the said breach

Transfer of Data outside Kenya

Transferring data to entities outside Kenya is not allowed without the subject’s consent. Further, the destination country must either have reciprocal agreement with Kenya, or has comparable data protection rules as determined by the Data Commissioner, or is signatory to the Malabo Protocol.

The transferring entity must also ensure that the recipient of the data accords it the required protection.

This particular provision may prove tenuous for entities to comply with especially the consent part. It has been suggested that entities who already have data processing consent from subjects such as customers, should only be required to ensure the data is transferred to a country with adequate data protection laws.

Data Protection Impact Assessment

Prior to high-risk data processing of data, entities will be required to carry out a data protection impact assessment.

This is for example processing of biometric or genetic data, large-scale use of data for a purpose other than that for which it was initially collected, a change in the way the entity processes data and so on as provided for under Regulation 42.

DPIA may be necessary for all data controllers and processors to perform prior to seeking compliance with Data Protection by Design and by Default requirements.

The Data Commissioner may also, subject to Section 23 of the Data Protection Act carry out periodic audits to assess compliance.

Provision of Exemptions

The regulations in Part VIII provide for when exemptions can occur:

-          For National Security purposes, there is a very high threshold which is for public entities covered under Article 239 (1) of the Constitution. These are the Kenya Defense Forces, the National Police Service, and the National Intelligence Service.

Anyone else will seeking exemption for reason of National Security will need to apply to the Cabinet Secretary for Information for exemption.

-          Public Interest purposes such as to report missing persons, preventing unlawful activity, asserting a legal or equitable claim and son on,

-          Permitted health reasons such as collecting and processing data for purposes of providing a health service or to carry out a health study or research.

General Provisions

Compounding of offences - the Data Commissioner with the concurrence of the Director of Public Prosecutions can compound a sentence with the written consent of the offender.

This avoids court procedure and the offender can be ordered to pay up to two-thirds of the maximum fine that would have been imposed upon conviction. The fine shall be payable within 14 days failure to which the Data Commissioner shall institute proceedings against the offender.


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