The Digital Personal Data Protection Act 2023 introduces a graduated penalty framework with maximum fines reaching ₹250 crores for the most severe violations. Unlike GDPR percentage-based penalties, DPDPA prescribes absolute monetary caps. This article examines the penalty structure, aggravating factors, and mitigation strategies.
The Penalty Architecture
The Schedule to DPDPA prescribes specific penalty ranges for different violations. Non-compliance with children data provisions attracts up to ₹200 crores. Failure to implement security safeguards or notify breaches carries penalties up to ₹250 crores. General non-compliance attracts up to ₹50 crores. These are maximum caps; the Data Protection Board determines actual amounts based on circumstances.
Key Points
- Children data violations: Up to ₹200 Cr
- Security and breach failures: Up to ₹250 Cr
- General non-compliance: Up to ₹50 Cr
- Board discretion in determination
Aggravating Factors
The Board considers several factors when determining penalty quantum: nature, gravity, and duration of breach; number of affected data principals; intentional or negligent character; actions taken to mitigate damage; degree of cooperation with authorities; previous breaches by the same entity; and financial benefits derived from the breach. Repeat offenders face significantly higher penalties.
Mitigation Strategies
Organisations can mitigate penalties through: prompt breach notification and remediation; comprehensive documentation of compliance efforts; investment in security infrastructure; cooperation with regulatory investigations; implementation of corrective measures before enforcement; and demonstrated good faith efforts at compliance even where failures occurred.
Key Points
- Prompt breach notification
- Documented compliance efforts
- Regulatory cooperation
- Proactive remediation
Comparison with Global Standards
GDPR penalties reach 4% of global annual turnover or €20 million. For large multinationals, GDPR exposure can exceed DPDPA caps significantly. However, for mid-sized Indian companies, DPDPA penalties represent substantial financial risk. The absolute cap approach provides predictability but may not scale with organisational size.
Key Takeaways
Map current compliance gaps to penalty exposure
Prioritise children data and security compliance
Document all compliance efforts meticulously
Establish regulatory cooperation protocols
Budget for potential penalty exposure