Data residency
Data residency is a critical concern for global businesses storing PII across regions. It dictates that you store, process, and manage your data in a way that meets regulatory, legal, or business requirements. Compliance with local laws like the EU’s GDPR, India’s DPDP Act, or Canada’s PIPEDA is essential to avoid regulatory risks, or worse, a security breach. But how do you ensure data stays within specific geographic borders?
Organizations handling PII face cybersecurity threats, foreign government access, and compliance fines for improper storage. Managing data at a global scale requires significant infrastructure investment and navigating overlapping regulations. Misconfigured access controls and complex data segmentation only add to the challenge.
Skyflow Data Privacy Vault simplifies compliance with multi-regional deployment, end-to-end encryption, and a zero-trust security model. Read on to learn more about the impact of practicing or not practicing data residency.
Data residency concerns
Data residency presents unique challenges due to regulatory and operational factors. Below are several significant hurdles organizations face:
Regulatory compliance
- Data protection laws: Laws like GDPR, CCPA, and Australia’s Privacy Act 1988 may conflict with offshore data storage.
- Cross-border data transfers: Complex regulations like GDPR require Standard Contractual Clauses to adequately transfer data from the EU.
Operational challenges
- Access and latency issues: International data storage can slow access times, impacting real-time applications and services.
- Data availability: Data located in foreign jurisdictions can complicate access during outages or disruptions, affecting data retrieval and impacting business continuity.
Data residency vulnerabilities
Breaches are the most severe consequence of poor data protection, and data residency can create vulnerabilities across many countries. The following breaches emphasize the complexities and key takeaways of navigating data residency.
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Marriott International 2018: Marriott’s breach exposed 500 million customers’ PII due to vulnerabilities in the 2016-acquired Starwood database. It spanned years and involved data stored in regions with weak privacy protections, highlighting risks like data fragmentation and the need for thorough acquisition due diligence.
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Google and the French data privacy violation 2019: France’s Commission Nationale de l’Informatique et des Libertés (CNIL) fined Google 50 million euros for violating the EU’s GDPR by failing to inform users about data collection for targeted ads. The violation underscored the need for transparency and clear consent and reinforced GDPR’s importance for global companies.
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Alibaba Cloud and Chinese data residency 2021: Reports suggested Alibaba Cloud shared data with Chinese authorities under local sovereignty laws, raising concerns about storing sensitive data on platforms subject to foreign regulations. The incident raised concerns about jurisdictional overreach and threatened cloud providers’ trust and credibility.
Safeguard data residency
To remain compliant, safeguarding your data requires segmenting sensitive information and storing it in the correct location. Continuous monitoring of storage and processing activities secures data residency.
Segment data by region
Create regional vaults and store data in compliance with local PCI DSS regulations.
Use case: A global payments company securely processes customer transactions across multiple regions, based on the respective countries’ regulations:
- U.S.: The CCPA requires storing SSNs within U.S. borders.
- EU: The GDPR mandates keeping EU citizens’ data within the EU.
- Canada: The PIPEDA Act requires financial data must remain in Canada.
Automate protection
Add custom logic to your workflows to automatically detect patient location and store data in the appropriate regional vault.
Use case: A healthtech company, operating in the U.S. and Germany, automates compliance for managing patient records through a telehealth app.
Govern with context
Apply contextual awareness to restrict access based on the user’s geographic location.
Use case: An insurance provider, With operations in Japan, Canada, and the U.S., enforces data residency policies for PII collected in insurance claims. They must adhere to the following local laws:
- Japan (APPI): Customer data must stay in Japan.
- Canada (PIPEDA): Financial and health data must remain in Canada.
- U.S. (HIPAA): Only authorized U.S. employees can access health data.
Protect data residency in a data privacy vault
Skyflow Data Privacy Vault offers robust solutions for data residency compliance. By storing data in region-specific vaults, you align your organization with local regulations and keep PII within the designated borders. With polymorphic encryption and tokenization, Skyflow secures data at rest, in transit, and in memory, reducing difficulties and technical overhead abroad.
Let Skyflow help you achieve data residency compliance. Take control today.
