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No-deal Brexit data - should firms worry?

BBC Technology 08 Oct 2019 11:13
By Rory Cellan-Jones Technology correspondent
Data representationImage copyright Getty Images

"Take steps now to keep receiving data legally from the EU."

That's the message for businesses in a full page government advert in the Financial Times and elsewhere.

It goes on to warn that after 31 October "you may need to update your contracts."

But just how worried should companies big and small be about handling data in the event of a no deal Brexit?

The advert tells readers to follow the step-by-step guide at gov.uk/brexit.

But when you arrive there, finding your way to the advice about data is not straightforward.

I found that I had to pretend to be a business and answer a whole series of questions before I was presented with the information.

So here is the key issue. Right now data can flow freely across the EU as long as companies conform to its tough new General Data Protection Regulation (GDPR).

But if there is no deal, we will be treated as an external country, needing what is called an adequacy ruling showing our data protection standards are up to scratch - and the European Commission has indicated that this would not happen in a hurry.

But if you receive data - perhaps a lists of names and addresses of customers - from a company in the EU or the wider European Economic Area then you will need to take action.

Err - right. I can hear dozens of small business owners gulping at that.

Don't worry, the government site says, "for most organisations, especially SMEs, taking the required action isn't highly costly and doesn't always require specialist advice."

Big companies are likely to have addressed this issue. One payments firm told me it had opened an office in Ireland, and was preparing to tell EU customers that their business would now be handled from there.

But how prepared are small businesses?

When he filled in the questionnaire he found he faced 21 Brexit-related issues, among them data transfers.

He now worries that he may need to sort out new contracts with all of his European customers. "My heart sank when I saw this - it's an insurmountable pile of bureaucracy for a small business."

It is all good business for lawyers. But Alex Brown, head of the technology practice at Simmons and Simmons, urges caution about just how serious the data transfer issue is: "If I was a business exporting this would be on my list to fix - but it wouldn't be near the top."

But it is just one more worry for businesses grappling with Brexit uncertainty.

A DCMS spokesperson said it was in everyone's interests that the exchange of personal data between EU member states and the UK continued, and the government had set out ways in which businesses could comply with EU data protection laws.

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