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When you launch a new business, you will undoubtedly have a long list of things to consider. Among these tasks will be considering your legal obligations and which documents you must have. If your business processes personal data as a controller before starting trading, you must inform individuals how to use their data. This article explores the UK GDPR rules around providing transparent information to individuals and when your business might need a privacy policy before it starts trading.
What is a Privacy Policy?
A privacy policy is a crucial UK GDPR compliance document that explains how your business collects, uses, and protects personal data. It is a transparency tool that ensures that your customers, employees, and other data subjects understand how you intend to use their personal information.
Under the UK GDPR, every business that processes personal data as a controller must provide clear and accessible transparency information to individuals whose personal data it processes. This requirement applies regardless of the size of the business. The most common way to achieve this is to provide individuals with a clear privacy policy document. Depending on your operations and how you process personal data, you may need more than one privacy policy.
This factsheet sets out how your business can become GDPR compliant.
Do I Need a Privacy Policy if I Am Not Yet Trading?
Even if your business is still in the early stages and has not started delivering products or services, you may still need a privacy policy. The critical question is whether you are collecting personal data before you begin trading.
Here are some common scenarios where you will likely need a privacy policy before selling products or services:
1. Have you already hired employees for your start-up business?
If hiring staff, you will collect personal data such as names, addresses, and phone numbers. This data processing necessitates providing staff with privacy information. Typically, this is done as part of a specific staff privacy notice outlining how you handle their data in an employment context.
2. Have you started to build an email list of your potential customers?
Do you plan to send these individuals a promotional offer? Or, have you sent an email about a product launch?
If you are gathering and holding their data as a data controller, you must inform them about how and why you collect it and how you intend to use it. You can issue them a privacy notice on this end.
3. Have you launched your website already?
Does it have a ‘Contact Us’ or sign-up form function where individuals can input their personal details? If so, you must provide them with private information about how you will use it.
In each of these situations, your business is handling personal data even before you start trading. Under the UK GDPR, you are required to have a privacy policy.
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Why Should I Prioritise a Privacy Policy?
When starting a business, it is easy to overlook the importance of a privacy policy, especially if you are not yet generating revenue. Drafting a privacy policy early on might also sound like a daunting task. However, this is crucial for several reasons.
A well-drafted privacy policy also builds trust with customers, investors, and partners by demonstrating your commitment to data protection. This is increasingly important in the business world. Additionally, as your business grows, a privacy policy will ensure you are prepared to manage larger volumes of personal data responsibly.
To comply with the UK GDPR, your privacy policy should be comprehensive and tailored to your business. It must clearly state:
- the types of data you collect (if your business collects it);
- its purpose; and
- the legal basis for processing it, whether through consent or legal obligation.
If you share data with third parties, you must transparently disclose this. Additionally, you must describe the measures you take to protect personal data and inform users of their rights under the GDPR, including:
- accessing;
- correcting; or
deleting their data.
It may be challenging to gauge whether you need to provide a privacy policy to individuals before you start trading. If you need support understanding your obligations, you should seek guidance from a data protection solicitor who can advise you.
Key Takeaways
Depending on what your business does and how it uses personal data, having a privacy policy before trading can be essential if you are already collecting personal data. Under the UK GDPR, you must clearly and accessible inform individuals about how you collect, use, and protect their data.
Implementing a privacy policy early will help:
- ensure legal compliance;
- build trust with stakeholders; and
- prepare your business for responsible data management as it grows.
If you need help understanding which UK GDPR compliance documents your business needs before trading, LegalVision’s experienced data privacy lawyers can assist you as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
Frequently Asked Questions
The UK General Data Protection Regulation (UK GDPR) is a legal framework that sets rules for collecting and processing individuals’ personal data within the United Kingdom. It aims to protect individuals’ privacy and data rights by requiring businesses to implement specific measures when handling personal data.
A privacy policy is a document that outlines how a business uses, stores, and protects personal data. It informs individuals about the types of data collected, the purposes for which it is used, the legal basis for processing, and any data-sharing practices. This document is crucial for ensuring transparency and compliance with legal requirements under data protection law rules.
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