Data Protection Impact Assessments: Guidance for Data Controllers Using Dynamics 365
Under the General Data Protection Regulation (GDPR), data controllers are required to prepare a Data Protection Impact Assessment (DPIA) for processing operations that are “likely to result in a high risk to the rights and freedoms of natural persons.” There is nothing inherent in Dynamics 365 that would necessarily require the creation of a DPIA by a Data Controller using it. Rather, whether a DPIA is required will be dependent on the details and context of how the data controller deploys, configures, and uses Dynamics 365
The purpose of this document is to provide data controllers with information about Dynamics 365 that will help them to determine whether a DPIA is needed and, if so, what details to include.
Part 1 — Determining whether a DPIA is needed
Article 35 of the GDPR requires a data controller to create a Data Protection Impact Assessment “[w]here a type of processing in particular using new technologies, and taking into account the nature, scope, context, and purposes of the processing, is likely to result in a high risk to the rights and freedoms of natural persons.” It further sets out particular factors that would indicate such a high risk, which are discussed in the following table: In determining whether a DPIA is needed, a data controller should consider these factors, along with any other relevant factors, in light of the controller’s specific implementation(s) and use(s) of Dynamics 365.
|Risk Factor||Relevant Information about Dynamics 365|
|A systematic and extensive evaluation of personal aspects relating to natural persons, which is based on automated processing, including profiling, and on which decisions are based that produce legal effects concerning the natural person or similarly significantly affect the natural person;||Dynamics 365 does perform certain automated processing of data, such as lead or opportunity scoring (for example, predicting how likely a sale is to occur). But it is not designed to perform processing on which decisions are based that produce legal or similarly significant effects on individuals.
However, because Dynamics 365 is a highly customizable service, a data controller could potentially configure it to be used for such processing, such as scoring for employment decisions or credit applications.
|Processing on a large scale 1 of special categories of data (personal data revealing racial or ethnic origin, political opinions, religious or philosophical beliefs, or trade union membership, and the processing of genetic data, biometric data for the purpose of uniquely identifying a natural person, data concerning health, or data concerning a natural person's sex life or sexual orientation), or of personal data relating to criminal convictions and offenses;||Dynamics 365 is not specifically designed to process special categories of personal data.
However, a data controller could use Dynamics 365 to process the enumerated special categories of data. For instance, Dynamics 365 offers healthcare industry templates which could be used to process personal data associated with a health condition. Further, Dynamics 365 is a highly customizable service that enables the customer to track or otherwise process any type of personal data, including special categories of personal data. But as the data processor, Microsoft has no control over such use and typically would have little or no insight into such use.
|A systematic monitoring of a publicly accessible area on a large scale||Dynamics 365 is not designed to conduct or facilitate such monitoring.
However, a data controller could use it to process data collected through such monitoring.
1 With respect to the criteria that the processing be on a “large scale,” Recital 91 of the GDPR clarifies that: “The processing of personal data should not be considered to be on a large scale if the processing concerns personal data from patients or clients by an individual physician, other health care professional, or lawyer. In such cases, a data protection impact assessment should not be mandatory.”
Part 2 — Contents of a DPIA
Article 35(7) mandates that a Data Protection Impact Assessment specifies the purposes of processing and a systematic description of the envisioned processing. A systematic description of a comprehensive DPIA might include factors such as the types of data processed, how long data is retained, where the data is located and transferred, and what third parties may have access to the data. In addition, the DPIA must include:
- an assessment of the necessity and proportionality of the processing operations in relation to the purposes;
- an assessment of the risks to the rights and freedoms of natural persons; and
- the measures envisaged to address the risks, including safeguards, security measures, and mechanisms to ensure the protection of personal data and to demonstrate compliance with this Regulation taking into account the rights and legitimate interests of data subjects and other persons concerned.
The table below contains information about Dynamics 365 that is relevant to each of those elements. As in Part 1, data controllers must consider the details provided below, along with any other relevant factors, in the context of the controller’s specific implementation(s) and use(s) of Dynamics 365.
|Elements of a DPIA||Relevant Information About Dynamics 365|
|Purpose(s) of processing||The purpose(s) of processing data using Dynamics 365 is determined by the controller that implements, configures, and uses it.
Dynamics 365 is an online platform for processing that is made up of several discrete online services, each of which has distinct purposes of processing. Below are the types of services offered by Dynamics365:
Customer Engagement at its core is a customer relationship management service. It includes the following online services: Dynamics 365 for Sales, Dynamics 365 for Marketing, Dynamics 365 for Customer Service, Dynamics 365 for Project Service, and Dynamics 365 for Field Service.
Dynamics 365 for Finance and Operations, Enterprise edition (D365FOEE) is an enterprise resource planning suite offered as a software as a service (SaaS), that is provided primarily to enterprise customer management of Sales, Service, Finance and Operations, Manufacturing and Human Resources.
Dynamics 365 for Retail (D365FR) is offered as a software as a service (SaaS) with integrated on-premise point-of-sale solutions for enterprise retailers and distributors.
Dynamics 365 Lifecycle Services (LCS) is and ancillary online service, used primarily by enterprise customers in the deployment, management, and maintenance of the customer’s D365FOEE, D365FR implementations.
Dynamics 365 for Business Central is an enterprise resource planning offering, provided as a Software as a Service (SaaS) by Microsoft to small and medium-sized enterprises. The service processes personal data to assist with finance, manufacturing, customer relationship management, supply chains, analytics, and electronic commerce.
Dynamics 365 for Talent is offered as a software as a service (SaaS), that provides customers with the management of Human resources and consists of the following services:
Core HR — A service to streamline recordkeeping tasks and automate processes related to staffing an organization. These processes include employee retention, benefits administration, compensation, training, performance reviews, and change management.
Attract - a service to find, interview, and hire personnel.
Onboarding - a service to help onboard new hires into their job*.
Microsoft Social Engagement (MSE) is an ancillary service to Dynamics 365 offered to enterprise customers to (i) enable processing of public social media posts and personal data posted by data subjects in a limited number of social media outlets to help them analyze and identify topics of interest (for example, trends), and manage corporate or institutional presence in these virtual places (for example, fan pages), including publishing content to specific social media outlets (listen); and (ii) engage directly with data subjects via private communications in social media (engage).
In its processor capacity operating the services enumerated above, Dynamics 365 processes personal data only to provide customers its online services as described, including purposes compatible with providing those services such as personalization, security, fraud and malware prevention, troubleshooting and improvement.
Microsoft processes data on behalf of the customer (tenant) as necessary to provide the requested service as set forth in our Online Services Terms.
Microsoft will not use Customer Data or information derived from it for any advertising or similar commercial purposes.
|Data retention||Microsoft will retain Customer Data for the duration of the customer’s right to use the service and until all Customer Data is deleted or returned in accordance with the customer’s instructions or the terms of the Online Services Terms. At all times during the term of the customer’s subscription, the customer will have the ability to access and extract Customer Data stored in the service. Microsoft will retain Customer Data stored in the Online Service in a limited function account for 90 days after expiration or termination of the customer’s subscription so that the customer may extract the data. After the 90-day retention period ends, Microsoft will disable the customer’s account and delete the Customer Data.
The customer can delete Customer Data and Pseudonymous data at any time using the capabilities described in the Dynamics’ Data Subject Rights Guide.
|Location and transfers of personal data||If Customer provisions its instance of Dynamics 365 Core Services in Australia, Canada, the European Union, India, Japan, the United Kingdom, or the United States, Microsoft will store Customer Data at rest within the specified geographic area, subject to certain exceptions as set out in the Online Services Terms. Detailed information about Customer Data storage can be found in the Trust Center.
For personal data from the European Economic Area and Switzerland, Microsoft will ensure that transfers of Personal Data to a third country or an international organization are subject to appropriate safeguards as described in Article 46 of the GDPR. In addition to Microsoft’s commitments under the Standard Contractual Clauses for processors and other model contracts, Microsoft is certified to the EU-U.S. and Swiss-U.S. Privacy Shield Frameworks and the commitments they entail.
|Data subject rights||When operating as a processor, Microsoft makes available to customer (data controllers) the personal data of their data subjects and the ability to fulfill data subject requests when they exercise their rights under the GDPR. We do so in a manner consistent with the functionality of the product and our role as a processor. If we receive a request from a customer’s data subjects to exercise one or more of its rights under the GDPR, we redirect the data subject to make its request directly to the data controller.
The Dynamics 365 Data Subject Request GDPR Documentation provides a description of how to support data subject rights using the capabilities in Dynamics
|An assessment of the necessity and proportionality of the processing operations in relation to the purposes||Such an assessment will depend on the controller’s needs and purposes of processing.
In its processor capacity, Microsoft offers D365 to process personal data only to provide customers its online services, including purposes compatible with providing those services such as personalization to the customer, security, fraud and malware prevention, troubleshooting and improvement. Microsoft processes data on behalf of the customer (tenant) as necessary to provide the requested service as set forth in our Online Services Terms found at http://microsoft.com/licensing/contracts.
|An assessment of the risks to the rights and freedoms of data subjects||The key risks to the rights and freedoms of data subjects from the use of Dynamics 365 will be a function of how and in what context the data controller implements, configures, and uses it.
However, as with any service, personal data held in the service may be at risk of unauthorized access or inadvertent disclosure. Measures Microsoft takes to address such risks are discussed below.
|The measures envisaged to address the risks, including safeguards, security measures, and mechanisms to ensure the protection of personal data and to demonstrate compliance with the GDPR taking into account the rights and legitimate interests of data subjects and other persons concerned||Microsoft is committed to helping protect the security of Customer’s information. In compliance with the provisions of Article 32 of the GDPR, Microsoft has implemented and will maintain and follow appropriate technical and organizational measures intended to protect Customer Data and Support Data against accidental, unauthorized, or unlawful access, disclosure, alteration, loss, or destruction.
For detailed list of Microsoft-managed controls (technical and business process controls) for security implemented by Dynamics 365 please visit the Service Trust Portal. Further, Microsoft complies with all other GDPR obligations that apply to data processors, including but not limited to, providing data protection impact assessments and accurate record keeping.