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THE TOP FIVE THINGS YOU NEED TO KNOW ABOUT THE EU GDPR

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By Jonathan Armstrong, data regulation adviser for Absolute Software and lawyer at Cordery

Back in 2012 the European Commission (EC) revealed its plan to completely revamp the 1995 EU data protection law, bringing it out of the Stone Age and making it fit for the 21st century. Every two days we create more data than ever existed before 2003. Businesses and consumers expect data to be accessible wherever and whenever they want. With the increasing adoption of sensor driven technology, cloud computing, BYOD and a whole host of other advances many feel that the old 1995 legislation needs, at the very least, a refresh.

In 2012 the EC finally published the long-awaited proposals for the new EU General Data Protection Regulation (EU GDPR).  Although this regulation is still only in its draft stage and is not expected to come into force before 2017, it is imperative that businesses are aware of what’s on the horizon so that they can start preparing for the colossal upheaval the regulation will cause. To help companies ensure they’re not caught off-guard by the pending regulation, here are five of the most important changes they need to be aware of:

  1. The regulation will apply across Europe

Not only will the new law apply throughout the EU, but also to organisations based outside of the EU that are active in the EU market and offer services to EU citizens. So, even though a US company may have all of its offices based in in the US, if it handles the data of EU citizens, it can still be investigated, fined and even prosecuted by an EU Regulator for data loss and misuse.

  1. Companies are liable to fines of up to two percent of their corporation’s annual global turnover

There are increased sanctions including fines of up to €100 million or up to two per cent of annual global turnover – whichever is greater. Compared to the current maximum fine in the UK of £500,000 from the Information Commissioner’s Office, the new law will dramatically raise the stakes. However, a fine may be avoided if a company can prove it had data policies in place, provided suitable education to employees, and used the correct technology software.

  1. Companies will have to notify those whose data has been breached

Unless a company can prove that it has technology in place that leaves a lost device inoperable or completely wipes the data contained on it, it will have to notify those involved in a potential data breach. So, if 100,000 customers’ data is lost, via a lost employee phone for example, then a company will have to tell all of them that their data may have been compromised. This can lead to significant brand damage, litigation and media reporting of the incident, as well as leading to significant cost in contacting the people affected.

  1. Organisations must notify the authorities about data breaches as soon as possible

The draft Regulation states that ‘if feasible’ companies should report a data breach within 24 hours. While it could be in the best interest of the business to report a breach within 24 hours, this is easier said than done. An employee may lose their device on a Friday evening and only report it on Monday morning or may be completely unaware that they’ve uploaded data onto the cloud for all to see.  Breaches also take time to deal with.  Most people would rather  an organisation spent the first hours after discovering a breach fixing it rather than preparing reports and completing other less essential tasks.

  1. Companies with 250 or more employees have to employ a corporate data protection officer

Enterprises of a certain size will need to hire someone who’s responsible for data protection. In the past, a few different people may have had some data protection training within their company but there may not have been a particular person who was directly responsible for data breaches. Now, companies will be obliged to appoint a properly trained data protection officer. And with the penalties set that much higher, it is advisable for businesses to seek out sound legal advice before choosing the correct candidate.

While we don’t know for certain the exact provisions of the EU GDPR, we do know that it is going to bring about considerable consequences to organisations across the globe. As we get closer to the official launch of the legislation, there will be two types of business; those that will only start making changes to their data protection policies once the law comes into force, and those who are already preparing for it. The latter, of course, has the upper hand. By clarifying data protection policies, educating employees, employing technology software, and for those larger organisations, hiring a data protection officer, all the right boxes will start to get ticked.

Of course, data breaches can still happen, but by proving all of these steps are imposed; companies can avoid the gargantuan fine. 2017 may seem a long way off, but the smart organisations will start seeking the correct advice and take action now, to ensure full compliance once the regulation comes into force.

Business

An unprecedented Black Friday: How can retailers prepare?

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An unprecedented Black Friday: How can retailers prepare? 1

Retailers must invest heavily in their online presence and fight hard to remain competitive as a second lockdown stirs greater uncertainty

With an unprecedented Black Friday and Cyber Monday weekend on the horizon (27th – 30th November), eCommerce hosting and consultancy expert, Sonassi, advises retailers to strengthen their online presence and make the necessary preparations for a fatigue in consumer spending.

James Allen-Lewis, Development Director at Sonassi, explains: “This year’s golden quarter has squeezed together three of the biggest sales periods like never before, meaning retailers will have to fight harder than usual to remain competitive this Black Friday. With greater discounts over a longer period of time, alongside the fact that a second lockdown has moved everyone and everything online, retailers will be battling it out for a share of decreasing consumer spending.

“However, this sense of uncertainty should not deter merchants from implementing their sales strategies this Black Friday and Cyber Monday weekend. Instead, they must go further than simply providing online discounts and tackle challenges head on by re-focusing their efforts on creating a highly competitive user experience. Successful merchants will make the necessary preparations for a change in consumer demand and invest more heavily in their eCommerce infrastructure.

“One way in which retailers can do this is by using last year’s Black Friday as a case study to inspire their future response. For example, retailers should take note of the key consumer behaviours that transpired throughout last year’s mega peak in discounting and plan accordingly for the upcoming Black Friday and Cyber-Monday weekend.

“Tactics such as providing the ultimate online delivery service and secure payment methods will also be pivotal for retailers looking to survive a fatigue in online spending. Consumers will look to retailers who do not overpromise on items like next-day delivery and ensure their checkout process is safe and frictionless for all. It is the retailers who embrace this fact and meet the needs of the conscious consumer that will win their share of consumers wallets.

Allen-Lewis concludes: “With Black Friday and the build-up to Christmas just around the corner, retailers must adapt to changing consumer demand, invest more heavily in their eCommerce infrastructure and focus their efforts on creating the ultimate online experience. The only way to plan ahead amid challenging times is to listen to the needs of the customer.”

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Optimistic outlook for 2021 public M&A

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Optimistic outlook for 2021 public M&A 2

Optimism is returning and the outlook is positive for the Australian M&A market in 2021 after a COVID-induced crash in deal activity in 2020, according to Corrs Chambers Westgarth’s tenth M&A 2021 Outlook report.

The special report reveals that an environment of historically low interest rates positions M&A as a significant means of achieving growth and generating returns, including for private equity firms looking to deploy capital and strategic buyers focused on complementary acquisitions.

With the unprecedented challenge of the COVID-19 pandemic, global political instability and arguably the greatest economic challenge since the Great Depression, M&A 2021 Outlook details somewhat surprising trends emerging for the next 12 months and analyses a number of common COVID-19 myths and their influence on future M&A deal making.

Corrs’ detailed examination of the Australian M&A market draws on data taken from the firm’s proprietary database of transactions combined with in-depth research for the 12-month period ending 30 September 2020.

Key trends identified in the report include a rapid escalation in M&A levels and an increase in creativity in pricing and speed in closing deals, while also highlighting the critical need for support from target shareholders. Conditions also appear to be set for a continued rise in equity prices as a result of the ongoing influx of capital into Australian equity markets, making it imperative that bidders employ strategies to move quickly on M&A transactions.

Discussing the M&A 2021 Outlook, Corrs Head of Corporate, Sandy Mak, said “Despite a challenging year, our research indicates that 2021 could well see the volume and value of deals continue to grow. We are already witnessing this uptick in activity and while some industries and sectors are seeing a faster rebound than others, early indications are that the wider public M&A market will continue to strengthen over the coming months.”

Based on its detailed research, the M&A 2021 Outlook report discusses further key findings including:

  • Deal volume and value is the lowest since 2016, however volumes have shown significant recovery since June 2020.
  • More than 50% of deals in 2020 were ‘hostile’ and not recommended at the outset.
  • 71% of deals over A$500 million were structured by way of a takeover – a significant increase from prior years – largely as a result of increased competition for assets through rival bids.
  • Despite border closures and the tightening of foreign investment regimes, the percentage of deals with foreign bidders has increased materially since April 2020.
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5 steps for SMEs to budget properly for the coming year

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5 steps for SMEs to budget properly for the coming year 3

By Fabio Comminot, Head of Dealing, Switzerland at Ebury, one of Europe’s largest Fintechs, has provided a five-step guide to make sure budgeting is done on time.

During the challenging times of COVID-19, it is difficult to forecast orders and costs. This is especially true for SMEs that operate internationally and therefore are exposed to currency fluctuations and market movements. So budgeting is immensely important.

Autumn is budget season for most companies. Upcoming project costs, sales and fixed costs must be defined or forecasted. Budget planning should be as accurate as possible right from the start of the process to avoid unexpected consequences at the end of the year..

With the effects of the COVID pandemic it has become difficult for all companies, no matter their size or history, to plan and make sales forecasts. Early planning and hedging are especially important for companies that work internationally and are therefore particularly exposed to currency risk.

These five steps will help SMEs take the right measures for the coming financial year, in time for budget season:

Step 1: Estimate your costs or sales in foreign currencies 

As difficult as it may seem, every company must estimate its expected fixed and variable costs for the coming year. Most companies can forecast their revenues based on experience or existing orders.

However, start-ups or young companies should also be able to at least estimate their costs including rents, insurance, wages and production costs. Special attention should be paid to costs or revenues that are spent or received in a foreign currency.

Step 2: Profit or cost assurance – define the strategy

As soon as an approximate plan for the coming year is in place, the company should consider the importance of currency management. Regular earnings or expenditures in foreign currencies are exposed to movements in exchange rates. If costs in a foreign currency are to be forecasted until the end of the year, the company needs to minimise volatility. This means that the exchange rate should be fixed so that there are no unexpected negative consequences at the end of the year.

Another option would be to protect the operating profit. Fluctuating exchange rates can rapidly ruin intended profit margins. In this case the company could aim to define the forecasted sales in the foreign currency and fix the margin based on this.

Step 3: Fix your budget rates 

The budget is set, the currency management goals are defined, the major part is done. Now it is a matter of defining the budgeted rates for the various currencies based on the current exchange rate. A buffer of about 5% can be useful when doing this – for example. instead of fixing the exchange rate from US dollar to Swiss franc at the current 91 cent, a rate of 95 cent could be budgeted. In this way, the minimum budget rate is defined and any negative exchange rate movement can be at least partially compensated for.

Step 4: Define the hedging strategy

With the targets and the budget course set, the next questions are: What currency developments can be expected? What is the industry outlook? Is the order situation relatively secure? Or is there practically no empirical data?

This step is where Ebury can support the company. Our experts in FX markets help answer these questions and begin to define the individual hedging strategy.

Step 5: Ensure a flexible fit

It’s done: the measures have been defined, now it’s time for implementation.

Ebury will implement the previous steps and , so that the company focuses on its core business. In contrast to traditional financial services providers such as banks, Ebury constantly monitors international trade and political events in order to assist clients with strategy adjustments. The Ebury team is supported by state-of-the-art technology and international currency analysts. It makes no difference whether the changes are driven by the currency market or whether the company’s order situation itself is changing. This allows the SME to focus on its operational business, which is worth a lot in uncertain times like these.

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