Privacy and Data Security in Outsourcing

Summary

This practice note discusses privacy and data security issues in outsourcing. Outsourcing frequently results in a company's data being stored outside of the company's firewalls—often in systems managed by the outsourcing provider. Outsourcing can also result in movement of the company's data to new and different countries, particularly when the supplier uses offshore resources or the outsourcing involves cloud computing. For outsourcing transactions that involve the transfer and processing of personal data, privacy protection and data security are significant legal risks.