When you sign a cloud data protection agreement (DPA), it may seem like you just agree to some simple terms and conditions. But in reality, there's a lot more that goes into these agreements than you may realize. In this blog post, we'll explore six items that are often included in cloud DPAs - and why they're important to understand. From indemnification clauses to limits on liability, these clauses can have a big impact on your business - so it's important to know what they mean.

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What is a Cloud Data Protection Agreement?

The practice of cloud data protection involves securing company data within a cloud environment. A Cloud Data Protection Agreement is a legally binding contract between a provider and a customer that outlines the terms and conditions of the parties’ relationship with respect to the processing of personal data. The agreement sets forth the responsibilities of each party and establishes expectations regarding the handling of personal data.

The purpose of a Cloud Data Protection Agreement is to ensure that both parties understand their respective roles and obligations with respect to the processing of personal data. The agreement should spell out what personal data will be collected, how it will be used, how it will be protected, and who has responsibility for each aspect of the data life cycle.

A well-drafted Cloud Data Protection Agreement will provide clarity for both the customer and the provider, and help to build trust between them.

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How cloud data protection agreements are different than data protection agreement 

There is a thin line difference between a data protection agreement and a cloud data protection agreement. A C DPA is a specific type of DPA that specifically applies to cloud-based services.

1.  A Cloud data protection agreement is specifically designed for data that is stored in the cloud, whereas a data protection agreement can cover any type of data. 
2.  Cloud data protection agreement will likely include provisions for how the data is to be protected when it is in transit to and from the cloud, as well as during its storage. 
3.  Cloud data protection agreements may also include provisions for how the data will be managed and monitored by the cloud service provider.

 According to a Cloud computing study in 2022

This year, 69% of organizations have accelerated their cloud migrations, and in 18 months, 63% of organizations are expected to have most or all of their IT infrastructure in the cloud.

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Why do companies need cloud data protection agreements?

With the fast-changing phase of technologies, most companies are opting to store their data in cloud base environment as companies are collecting vast amounts of data ranging from confidential data of the business to public data as well. With this process of converting to cloud base environment, it is getting more evident how complicated protection of data could get for securing data on multiple environments e.g.

1. No physical evidence of data
2. With data stored in the cloud or third parties infrastructure, they don't know who has access to their data
3. Not having clue how the cloud service provider is storing and securing the data

Companies also must comply with data protection and privacy laws and regulations, such as the GDPR, in the EU,  HIPAA, in the U.S., and others. 

Many companies struggle to establish and enforce security policies consistently across multiple cloud environments, let alone demonstrate compliance to auditors.

What should be included in a Cloud Data Protection Agreement?

A cloud data protection agreement (DPA) is a contract between a cloud service provider and a customer that outlines the responsibilities of each party for protecting the customer's data.

Items that are often included in a DPA:

-The data type that will be protected.

-The security measures that will be used to protect the data.

-The procedures for handling data breaches.

-The customer's rights and responsibilities with respect to their data.

-The service provider's rights and responsibilities with respect to the data.

-The requirements for Auditing and duration.

-The scope of data protection law

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Is managing a cloud data protection agreement alone disadvantageous?

Let's talk about what things we need to consider if we are dealing with C DPA from scratch. The creation and management of DPAa are essential if you provide data processing services, especially to clients working with EU data. You have to do some digging by searching already created DPA in the market For example, Google Cloud, and Oracle Contracts, SAP are easy to find and read. Data processing agreements can get complicated and lengthy when attached to service agreements, however, if you choose to read it on your own and make an informed decision could cost your business a lot of time.

 Managing more clients and their unique needs for personalizing DPA that meet their desired data usage result could drain your legal team's productivity. considering past experience it is of prime importance to accurately manage client data, you will need a smart contract lifecycle management(CLM) platform that gives you a transparent accurate, and concise comparison between DPA you want and DPA you are signing. Minimizes error with the advanced technology and brings the maximum error rate to 0.01% with empowering flexibility to make changes according to client needs. Try it out for yourself by booking a demo.

In summary

Cloud data protection agreements are important for any business that uses cloud-based services. It's important to have transparency of the potential risks involved in using cloud-based services and to make sure you're fully protected by a comprehensive data protection agreement. Although most providers are reliable and take measures to protect your data, there's always a possibility that something could go wrong. This article has hopefully given you a few things to think about when it comes to your own agreement By taking the time to read through your provider's DPA, you can be sure that you understand their obligations and what steps they'll take to keep your data safe. And if you have any questions, don't hesitate to ask your provider for clarification.