Article Synopsis :
Some of the biggest and most complex legal questions and business risks faced by multinationals in 2018 concerned cybersecurity and data privacy. That is not a trend that is likely to change any time in the near future.
Mayer Brown has identified the following as the main cybersecurity and data privacy issues that multinationals face in 2019:
- Managing cyber incidents across borders
- Continued regulatory pressure on cybersecurity and data privacy
- Expanding cybersecurity and data privacy litigation
- Increasing adoption of comprehensive data privacy regimes
- Focus on data privacy and cybersecurity policy
The bad guys get bolder
Levels of sophistication have increased for cyber attacks. They range from extortion schemes through to attacks on infrastructure to connected products and also huge data breaches with data losses.
Despite increased sophistication, the old ways remain popular and in 2018 there was even an increase in the use of business email to launch attacks.
This highlights the need for businesses to be vigilant and to deploy best practice to defend themselves and their customers.
Compliance is a major headache – for everyone
The General Data Protection Regulation (GDPR) came into force in the European Union and will have an impact upon many companies around the world.
Other jurisdictions are looking to similar laws that will increase the burden of compliance, but this may extend to all regions as regulators make efforts to protect consumers.
Disruptive tech, such as autonomous vehicles, artificial intelligence, connected products, will contribute to the development of the landscape for cybersecurity and data privacy.
There will be increased regulation, and with it, more litigation risk
Policymakers have their eye on business
The White House Council of Economic Advisers released a report in 2018 that estimated the cost of the malicious cyber activity to the US economy as somewhere between $57 billion and $109 billion – just for the year 2016.
Cyber incidents are big news now and can damage not only company reputations, but can derail careers, with a number of senior executives have fallen on their swords over data breaches.
Data privacy remains a live subject, with the US Senate and UK House of Commons select committees examining the role of business in maintaining data and the trust of their customers.
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Digital Insurer's CommentsThe risks associated with cybersecurity and data privacy are ever greater.
While this paper looks at the risks to all multinationals, there is a very real and present danger that insurers will be facing increased attack from criminals.
They are also facing increased compliance to demonstrate they are protecting consumers.
It’s another job they could do without, but this emphasises the importance of how insurtech can – and is – beginning to undermine any cultural resistance some incumbents have displayed in the past.
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