Data Controller or Data Processor?

How to Interpret Two Core Definitions of Data

Protection Legislation

Companies and

individuals may face difficulties in determining which one of the definitions

they fall under and whether they or the ones they are working with have data

protection responsibility. Interaction between these two concepts is of paramount

importance, as it imposes obligations in terms of liability. This piece aims to

inform companies involved in the processing of personal data to be able to

determine whether they are or the third parties they work with are acting as a

data controller and/or as a data processor under Turkish data protection

legislation.

Along with information

systems, business models become more complex. A number of organizations may be

working together in an initiative that involves processing personal data. Even

if the "data controller" and the "data processor" are defined under the data

protection legislation, companies and individuals may face difficulties in

determining which definition they fall under and whether they or the company

they are working with have data protection responsibility within the scope of

the Law No. 6698 on Protection of Personal Data.

Processing of personal data means

any operation performed on personal data, wholly or partly, whether through

automatic means, or if the data is part of a data filing system, through

non-automatic means, such as collection, recording, storage, preservation,

alteration, retrieval, disclosure, transfer, acquisition, making available,

categorizing or blocking. Considering this wide definition, entities and individuals

who are involved in the aforementioned activities may fall under the scope of

data controller or data processor, and might be held liable for their actions.

According to Article 3/1(i) of the DP

Law; data controller is;

"the real person or legal entity which sets the objectives and means of

processing personal data and who is in charge of establishment and management

of data filing system".

Data processor on the other hand is

defined as;

"the

real person or legal entity, which processes personal data based on the

authority given by and on behalf of the data controller" under Article 3

(1-g) of the DP law.

One of the main reasons there is a

distinction between the two terms are to prevent loss of a right when the data

is being processed. There is a significant line in between the data controller

and processor because the data controller will be the one to determine the

reason for process, and the processor will be the one to act within the scope

of framework determined by the controller. As indicated under Article 12(3) of

the DP Law the data controller is obligated to carry out or have carried out

necessary inspections within his institution and organization in order to

ensure implementation of the provisions of the DP Law.

Within the scope of EU Data

Protection Directive 95/46/EC ("Directive") data controller means a person who

(either alone or jointly or in common with other persons) determines the

purposes for which and the manner in which any personal data are, or are to be,

processed. A data controller must be a "person" recognized in law, that is to

say: individuals; organizations; and other corporate and unincorporated bodies

of persons. For example; a government department sets up a database of

information about every child in the country. It does this in partnership with

local councils. Each council provides personal data about children in its area,

and is responsible for the accuracy of the data it provides. It may also access

personal data provided by other councils (and should comply with the data

protection principles when using that data). The government department and the

councils should be deemed data controllers in relation to the personal data on

the database.

As a general principle under DP Law

and EU legislation, data controller determines the purposes for which and the

manner in which personal data will be processed. Therefore, the data controller

is the actor who decides "how" and "why" personal data is processed.

Data

processor, in relation

to personal data, means any person (other than an employee of the data

controller) who processes the data on behalf of the data controller. For

example a utilities company engages another company which operates call centers

to provide its customer services functions on its behalf. The call center staff

has access to the utilities company's customer records for the purpose of

providing those services but may only use the information they contain for specific

purposes and in accordance with strict contractual arrangements. The utilities

company remains the data controller. The company that operates the call center would

be considered as a data processor.[1]

In some cases, there are difficulties

in determining data controller and processor responsibilities. For example, in

the franchise business model, the parent company decides which personal data

will be collected and how personal data will be processed, and the company with

the branch must comply with these rules. However, the branch that collects

personal data is directly related to the data subjects and is the first point

of contact where personal data is collected. If the branch makes the decision

on setting the objectives and means of processing personal data and who is in

charge of establishment and management of data filing system, the parent

company should not be considered "data controller" but the branch should.

With regards to determining whether

an organization is a data controller or a data processor the following list can

be useful; [2]

to collect the personal data in the first

place and the legal basis for doing so;

which items of personal data to collect, i.e.

the content of the data;

the purpose or purposes the data are to be

used for;

which individuals to collect data about;

whether to disclose the data, and if so, who

to;

whether subject access and other individuals'

rights apply ie the application of exemptions; and

how long to retain the data or whether to make

non-routine amendments to the data.

According to Article 29 Data

Protection Working Party, an independent EU advisory body, there are three ways

a controller can be appointed[3]; (a) Control stemming from

explicit legal competence: establishes a task or imposes a duty on someone to

collect and process certain data. For example, this would be the case of an

entity which is entrusted with certain public tasks (e.g., social security) which

cannot be fulfilled without collecting at least some personal data, and sets up

a register with a view to fulfil them. (b) Control stemming from implicit

competence: stems from common legal provisions or established legal practice

pertaining to different areas for example the employer in relation to data on

his employees, the publisher in relation to data on subscribers, the

association in relation to data on its members or contributors. (c) Control stemming

from factual influence. This is the contractual relations between the different

parties involved.

According to Information

Commissioner's Office data processor may decide:

what IT systems or other methods to use to

collect personal data;

how to store the personal data;

the detail of the security surrounding the

personal data;

the means used to transfer the personal data

from one organization to another;

the means used to retrieve personal data about

certain individuals;

the method for ensuring a retention schedule

is adhered to; and

the means used to delete or dispose of the

data[4].

In order for data subjects to

securely disclose their personal data, the data controllers and data processors

are obligated to process the personal data within the scope of the purpose of

processing. The data controller has the right to decide on which items to

collect, to determine the purpose of processing and whether to disclose the

data or not which gives the controller a freedom to carry out its activities in

a manner and technical style, and as per Article 17 of the Directive, must

implement appropriate technical and organizational measures to protect personal

data against accidental or unlawful destruction. Whereas, the processor mainly

is given the option to rely on decisions taken by controller and will be

obliged to follow the rules and take necessary steps determined by the

controller. As per Article 16 of the Directive, the data processor acting under

the authority of the controller who is allowed to process the data and has

access to it, is required to act based on the controller's instructions or based

on law.

Authors:

Gönenç Gürkaynak, Esq., Ilay Yilmaz and Nazli Pinar Taskiran, ELIG,

Attorneys-at-Law

First

published in Mondaq on April 25, 2017.

[1] https://ico.org.uk/for-organisations/guide-to-data-protection/key-definitions/

[2] http://ec.europa.eu/justice/policies/privacy/docs/wpdocs/2010/wp169_en.pdf

[3] http://ec.europa.eu/justice/policies/privacy/docs/wpdocs/2010/wp169_en.pdf

[4] http://www.thesolicitorsgroup.com/News/Article.aspx?ArticleID=3569921a-a91a-4eaf-a712-f71147164715