Executive Summary
Cross border data transfers enable global operations but face DPDPA restrictions. Section 16 establishes a notification-based framework where transfers are permitted only to government-notified destinations. This guide addresses how to structure compliant international data flows within this framework.
Key Takeaways
- 1Map current cross-border data flows as the starting point for compliance assessment
- 2Monitor government notifications regarding permitted transfer destinations
- 3Implement contractual safeguards for transfers to permitted destinations
- 4Consider structural alternatives where transfers to needed destinations are restricted
- 5Document transfer compliance decisions and supporting analysis
1The Section 16 Framework
DPDPA permits transfers to countries and territories notified by the Central Government. Transfers to non-notified destinations face restrictions. This creates a simpler but potentially more restrictive framework than adequacy or contractual mechanisms used elsewhere.
2Mapping International Data Flows
Understand where data currently moves internationally.
Direct Transfers
Identify data sent directly to foreign recipients including affiliates, customers, partners, and service providers.
Cloud Services
Determine where cloud services store data. Many cloud providers have multi-regional infrastructure.
Remote Access
Map access to India-located data by personnel abroad. Remote access may constitute transfer depending on circumstances.
Processor Chains
Trace where processors and subprocessors are located. Data may move through multiple jurisdictions.
Business Necessity
For each flow, document the business purpose. This supports prioritisation and alternative planning.
3Assessing Transfer Permissibility
Determine which current transfers are or will be permitted.
Notification Status
Check whether each transfer destination is on the notified list. Monitor for updates as notifications are issued.
Permitted Transfers
For transfers to notified destinations, proceed to implementing appropriate safeguards.
Restricted Transfers
For transfers to non-notified destinations, assess alternatives including restructuring, relocation, or cessation.
Pending Determinations
For destinations awaiting notification decision, plan for both outcomes. Have contingencies ready.
4Safeguards for Permitted Transfers
Even permitted transfers require appropriate protections.
Data Transfer Agreements
Execute agreements with foreign recipients that impose data protection obligations. Include security requirements, use restrictions, and audit rights.
Standard Clauses
As India develops standard contractual clauses, adopt them. Until then, use robust bilateral terms modeled on international standards.
Due Diligence
Conduct due diligence on foreign recipients' security and compliance capabilities.
Ongoing Oversight
Monitor recipient compliance through periodic assessments, certifications, or audit rights.
Breach Coordination
Ensure contractual provisions enable prompt breach notification from foreign recipients to support your notification obligations.
5Alternatives for Restricted Transfers
Where needed destinations are not permitted, consider structural alternatives.
Local Processing
Process data in India rather than transferring. This may require infrastructure investment or service provider changes.
Hub Restructuring
Route transfers through permitted jurisdictions rather than directly to restricted destinations.
Data Minimisation
Reduce what is transferred. Can some data be processed locally with only results shared abroad?
Anonymisation
If anonymised data serves the purpose, anonymise before transfer. Truly anonymised data falls outside DPDPA scope.
Process Redesign
Redesign business processes to reduce transfer needs. Sometimes process changes can eliminate transfer requirements.
Important Warnings
- •Restructuring takes time and resources. Begin planning early.
- •Anonymisation must be robust to be effective. Weak anonymisation that can be reversed does not solve the transfer problem.
6Group Company Considerations
Multinational groups face particular challenges with internal data flows.
Group Transfer Framework
Develop a group-wide approach to transfers including standard agreements, governance, and compliance monitoring.
Centralised Functions
Assess centralised functions (HR, finance, IT) that involve cross-border data sharing. Determine compliance approach for each.
Regional Hubs
Consider establishing regional processing in permitted jurisdictions to support group operations.
India-Specific Measures
Where India requirements differ from group standards, implement India-specific measures. Global templates may need local adaptation.
7Documentation and Compliance Records
Maintain records supporting transfer compliance.
Transfer Inventory
Maintain comprehensive inventory of all cross-border transfers including destinations, recipients, data types, and purposes.
Legal Basis Records
Document the legal basis for each transfer including notification status verification.
Contractual Documentation
Maintain executed transfer agreements and evidence of recipient compliance.
Decision Records
For transfers requiring judgment calls, document the analysis and decision rationale.