Privacy Advisor

Preparing for the EU Regulation: Facebook, Proctor & Gamble and Siemens

April 25, 2013

By Sam Pfeifle
Publications Director

It’s all well and good to speculate on where the EU’s privacy regulation will wind up, as European Data Protection Supervisor Peter Hustinx did for the IAPP Europe Data Protection Intensive, but for those charged with heading up privacy programs at large corporations, the uncertainty can be the cause for some serious heartburn.

In the second half of the day’s programming, one of the better-attended breakout sessions, “Paving the Way from Policy to Practice,” moderated by LexisNexis Privacy and Data Protection Senior Director Emma Butler, featured privacy officers at Proctor & Gamble (P&G), Siemens and Facebook outlining how they see the looming regulation affecting their operations and what they’re doing to prepare.

P&G Senior Legal Counsel-Transactions and EMEA Privacy Law Ross Phillipson allowed that “we spend an awful lot of time discussing these issues internally—and internationally. This is informing what’s going on in Latin America, in Asia. Even our U.S. guys are seeing the world going toward an EU approach to privacy.”

And in the context of a great deal of carrot-and-stick conversations here in London, Phillipson said it was the stick that was helping him get upper management’s attention. “The good thing about the two-percent thing is that it allows us to drive privacy through the organization,” he said.

Yes, two percent of $83 billion in annual turnover is a lot of money in potential sanctions.

Phillipson said the good news is that he feels P&G is already largely compliant with what’s coming down the pipeline, but that doesn’t mean decisions don’t have to be made. “You can either go lowest common denominator,” he said, “which means you miss out on valuable data in many countries, or you can drive a high-level program based on principles. We haven’t decided where we’re going with that yet.” However, “we’re in the process of establishing a robust procedure. We already have DPOs in many places and we’re assessing whether it will be every jurisdiction or can we get to one DPO regionally, running people in all the different countries, in order to streamline our process?”

Already, in what he called a “critical win,” P&G has a set policy where anyone handling PII is immediately instructed to see a DPO or someone in the privacy office.

Unfortunately, it’s not just the internal team that P&G needs to worry about. “We see that it’s our responsibility to educate our suppliers,” Phillipson said. “I’d like to see that change. If you’re doing work in the PII field, it should be your job to know the law.”

As a supplier to thousands of corporations in myriad verticals, Siemens certainly takes knowing the law seriously, said Chief Data Protection Officer Florian Thoma, CIPP/US, CIPP/E. Unfortunately, he has something of the opposite problem: He becomes a handler of PII whether he likes it or not.

“We’re active in the healthcare field,” he said, “with x-ray imaging devices and many other products, and there’s a service business associated with that. Sometimes we can’t avoid access to patient data.” How much? Oh, roughly half of the U.S. population, for example.

As you can imagine, “the regulation was something we focused on very early,” he said. Unfortunately, he pointed out, there are thousands of amendments proposed and “that’s something we struggle with. How will the regulation look at the end?”

Thus, they’ve tried to focus on big-picture items. “We’ve worked heavily to integrate a risk-based approach,” and he welcomes risk-based language being integrated into the regulation. However, “Privacy by Design—and by default—will be new to us. With our products and services in the healthcare field, we have not really focused on Privacy by Design so far. The machines have mostly been implemented by the hospitals, not us.” Siemens will now bear some accountability for how they’re used.

Perhaps no company is more affected in the privacy world by how their users consume their service than Facebook, so UK and Ireland Policy Director Simon Milner can feel Thoma’s pain.

Sure, Facebook Ireland is home to the personal information of about 800 million users, but Facebook is also a platform upon which “many thousands” of businesses are almost entirely based, “and whether they’re Spotify or Netflix or on the education or game front, we want them to thrive…We think the data-driven economy should be part of Europe’s renaissance,” Milner said.

It should be no surprise, then, that Facebook has some concerns about compliance with what is eventually enacted.

“One is around consent,” Milner said. “We are concerned that an over-the-top consent model is not going to work. Those people based in the UK know that with the e-Privacy Directive, the way it has played out in practice has not helped users. I don’t know anyone who’s ever clicked through to look at the details of how the cookie policy works…We don’t think notice for every time information is collected is going to work.”

Nor will the right to be forgotten be workable, Milner predicted. “We absolutely support and comply with the right to erasure. If you want to delete your data from Facebook, not only can you do it, but we’ve been audited to show that we do it. But we object to the fact that people who post about you, which is freedom of expression, that we have to delete that. Or if we’re reaching into another organization where something’s been shared by another user, we don’t think that’s workable.”

Thus, Facebook is preparing for the upcoming regulation by lobbying to change pieces of it. “There are good signs that regulators and policy-makers understand” Facebook’s position, he said.

But that’s the rub. Privacy professionals are left reading signs. Heck, reading tea leaves. As Siemens’ Thoma put it, “With thousands of proposed amendments, we can’t decide on detail.”

Read More By Sam Pfeifle:
Hustinx Emphasizes Accountability in Outlining Road Ahead for EU Regulation
Clarifying Privacy in the Cloud
New FTC Chair Ramirez Points to COPPA, Mobile Space, BCR-APEC Alignment as Priorities
Big Data=Big Oil?