Extra diligence required.
Changes to privacy legislation under consideration by the Federal Government should pose serious concerns for businesses embracing cloud computing, according to a leading intellectual property lawyer.
A revised Privacy Principle 8, released in an exposure draft [PDF] [see page 17] in June 2010, creates new requirements for organisations outsourcing data that identifies Australian citizens to offshore data centres.
Specifically, Privacy Principle 8 requires that any organisation storing information that identifies Australian citizens in overseas data centres must ensure that the organisation hosting that data offers the same protections as what is stated in Australia's Privacy Principles.
Mark Vincent, partner at Truman Hoyle and one of the nation's foremost legal experts on cloud computing, told iTnews that organisations would be wise to conduct due diligence before outsourcing to foreign cloud computing platforms.
The world's largest cloud computing platforms - which include Amazon's EC2, Microsoft's Azure and Salesforce.com - do not host data in Australia but in Asian business centres such as Singapore.
The revised Privacy Principles won't be debated until mid-2011. But if passed, these laws could have serious repercussions for customers hosting data offshore.
"If an Australian company puts its consumer data - its private data - into the cloud, it has to make sure that the company it [hosts] it with has adequate safeguards with the equivalent of Australian Privacy Principles in place," Vincent said.
"If it doesn't take those steps to make sure this company is going to look after the data in the same way, and there is a breach, the Australian company under the exposure draft will be liable for the breach," Vincent said. "That's a new development that goes a lot further than existing Privacy Principles."
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Source: itnews.com.au
By: Brett Winterford
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