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By Alisa Fetic
The 2021 Cyberthreat Defense Report (CDR) revealed that a staggering 85.7% of Canadian businesses were hit by cyberattacks in 2020.
The frequency and seriousness of cyberattacks have caused the country to establish strict laws to protect its citizen's confidential data. Canada has enacted several data regulations policies that apply to the public and private sectors.
In addition, certain provinces have enacted comprehensive privacy laws that apply to the private sector. We'll look into these privacy regulations and explain how they affect businesses.
Canada's Private Sector Privacy Statutes
Canada's private sector is governed by the following privacy statutes.
- Personal Information Protection & Electronic Documents Act (PIPEDA)
- Personal Information Protection Act (British Columbia) (PIPA BC)
- Personal Information Protection Act (Alberta) (PIPA Alberta)
- Quebec's Privacy Act (Bill 64)
The PIPEDA is Canada's main federal law protecting user privacy and governing how organizations handle sensitive personal information. We'll explore PIPEDA in detail and explain how it affects businesses in Canada.
What Is PIPEDA?
The Personal Information Protection & Electronics Documents Act, commonly known as PIPEDA, is a Canadian data protection law that received Royal Ascent on April 13, 2000, and came into force on January 1, 2001.
The PIPEDA regulates how businesses can collect, use, and disclose personal information when carrying out commercial activities. Personal information is defined as "any information that can identify a person." It can refer to information about your:
- Religion
- Marital status
- Race, nationality, or ethnic origin
- Financial information
- Medical information
- Education
- Employment
- Identifying numbers such as your driver's license, social insurance number
- DNA
Under PIPEDA, there are 10 fundamental principles that organizations must follow regarding individuals. Specifically, these principles ensure that individuals:
- Give consent to the use of their personally identifiable information (PII)
- Can access their information
- Can modify their information if need be
To comply with PIPEDA, organizations must adhere to each of the fair information principles defined by the governing body.
How Does PIPEDA Protect Personal Identifiable Information (PII)
PIPEDA specifies three types of protections that safeguard personal data.
Physical Safeguards
Organizations should have physical safeguards to prevent unauthorized access to consumers' private data. Measures may include installing surveillance cameras, locking offices, etc.
Organization Safeguards
Organization safeguards include policies and procedures laid down by a company to prevent unauthorized access to private data. These may include training employees on the importance of data privacy and limiting user access privileges.
Technical Safeguards
Many technical safeguards can be undertaken to protect consumers' sensitive data. These may include implementing robust firewalls, managing user login activities, encrypting data, etc.
How PIPEDA Affects Your Business
If you're running a private business in Canada that collects consumers' personal information during its day-to-day operations, your business is required to adhere to PIPEDA's data protection laws. The PIPEDA regulates how you collect, use, and disclose this information.
Under PIPEDA, you're required to safeguard this data and appoint someone to be accountable for compliance with the data privacy policies. You must also obtain consent to collect and use that data from the said individuals and specify the purpose for which the data is collected.
Additionally, the data must be used only for the purpose it was collected. And if requested, the individual must be given access to the data.
Failure to compile to these laws alongside others specified in the 10 fair information PIPEDA principles can lead to penalties, including fines of up to CAD$ 100,000.
Wrapping Up
Since organizations depend on consumers' trust to thrive and stay in business, these privacy laws are a constant reminder that data privacy is critical for any business, irrespective of size. Federal regulations like PIPEDA ensure data privacy takes precedence and that consumers can transact without worrying that their data will fall into the wrong hands.