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ISO 27701 Certification for SaaS Companies vs. GDPR Compliance: What’s the Difference?

ISO 27701 Certification for SaaS Companies

Since SaaS companies operate in even larger amounts of personal data across the areas, they are now obligated to fulfill privacy expectations as a business necessity. The purpose of ISO 27701 and GDPR is alike, as they are two significant frameworks that assist organizations in enhancing data protection programs, although they are not used in the same way. Those differences allow SaaS platforms to select the correct strategy of developing long-term trust, security, and compliance.

The present blog discusses the difference between the ISO 27701 Certification for SaaS Companies and GDPR Compliance, their differences, and which one is more important to your organization.

Understanding the Basics

What Is ISO 27701?

The ISO 27701 is a global privacy supplement of the ISO 27001 standard. It gives recommendations on how to implement a Privacy Information Management System (PIMS) in order to safeguard Personally Identifiable Information (PII). The objectives of an ISO 27701 certification for SaaS companies include:

  • Establish powerful privacy settings.
  • Create explicit roles of PII controllers and processors.
  • Standardize data-handling processes.
  • Exhibit worldwide accountability in privacy.

What Is GDPR?

The General Data Protection Regulation (GDPR) is the law that guarantees the rights of persons in the European Union (EU). The SaaS firms that process the data of EU residents are obliged to comply with the provisions of GDPR.

GDPR is not a certification, but a law. Organizations are not certified according to GDPR in the same way as ISO; they can only certifiably show GDPR compliance.

The main duties are:

  • Obtaining valid consent
  • Protecting the right to access, alter, or erase personal data.
  • Reporting data breaches
  • Privacy by design.

ISO 27701 vs. GDPR: Key Differences

To make SaaS companies aware of the difference between the two, the simplified comparison is given below:

AspectISO 27701 Certification for SaaS CompaniesGDPR Compliance
TypeVoluntary international standardMandatory EU legal requirement
PurposeBuilds a structured Privacy Information Management System (PIMS)Protects personal data rights of EU residents
ScopeInternal processes, documentation, and PIMS designLegal obligations, user rights, data processing rules
CertificationYes, organizations can be certifiedNo formal certification—only compliance
ApplicabilityGlobalEU and companies handling EU residents’ data
ApproachRisk-based and process-drivenLaw-driven and rights-based
Audit RequirementThird-party audit for certificationNo certification audit, but legal investigations are possible
FocusPrivacy controls, governance, PII processesData protection, consent, individual rights

Why ISO 27701 Can Guide SaaS firms to meet GDPR Obligations?

As much as ISO 27701 cannot supplant GDPR, it offers a logical roadmap that facilitates the process of getting ready for GDPR. In the case of SaaS operations, it develops a step-by-step road map of the privacy governance.

1. Adheres to GDPR Data Minimization& Privacy by Design

ISO 27701 encourages companies to:

  • Reduce the gathering of unneeded information.
  • Use privacy over the lifecycle of data.
  • This is in line with the requirements of GDPR.

2. Varies Roles of PII Controllers & Processors

SaaS firms tend to serve as processors of customer information. ISO 27701 clearly outlines:

  • Processor responsibilities.
  • Control responsibilities.
  • Paperwork needed to establish compliance.
  • This facilitates GDPR management of contracts.

3. Improves Operational Privacy Controls

To ensure SaaS companies have:

Documented data flows

Robust risk assessments

Secure storage controls

Formal privacy procedures

These business controls are the pillars of GDPR compliance.

Important Dissimilarities SaaS Companies Should Pay Attention To

GDPR Is Mandatory, ISO 27701 Is Voluntary

Although a SaaS company may not be bound by ISO certification, compliance with GDPR is obligatory in case they process EU data.

The ISO 27701 Is Audited; GDPR Regulators Enforced

In ISO 27701, the third-party audit is done to confirm the controls. On the contrary, the GDPR is supervised by data protection authorities that can impose hefty fines.

ISO 27701 Provides Furniture; GDPR Requirements

A SaaS company can use ISO 27701 to:

  • Build policies
  • Define responsibilities
  • Create privacy workflows

GDPR instructs the company on what to do, and ISO 27701 explains how.

What do SaaS Companies need to focus on?

In the case of companies that have EU clients:

There can be no compromise on GDPR compliance.

In case your SaaS application deals with international data:

The ISO 27701 assists in developing a globally accepted privacy framework that is scalable.

In case you wish to establish customer trust:

An independent validation of your privacy approaches in the data operation is an added advantage to ISO 27701 certification, since it gives you a competitive advantage.

In case you desire maturity in long-term privacy:

These two frameworks are complementary to one another. When SaaS companies apply the ISO 27701, they often notice that it will become much easier and will not take so much time to comply with GDPR.

Final Words

The ISO 27701 certification for SaaS companies and GDPR have different yet related purposes. GDPR is a legal requirement, and ISO 27701 is a scheme that facilitates a well-organized way to put the requirements into practice. The combination of both strategies is beneficial for SaaS businesses seeking to maintain high global privacy governance standards. Through the integration of the systematic controls of ISO 27701 and the legal requirements of GDPR, an organization will establish a mature and reliable privacy ecosystem. QIC Global can be a valuable partner in ensuring that businesses achieve uniform and systematic compliance with privacy regulations with their hassle-free audit services.

FAQs

Does ISO 27701 suffice to demonstrate the compliance of GDPR?

No. ISO 27701 facilitates compliance activities, whereas GDPR is not only a legal mandate but also cannot be fully achieved through certification.

Should SaaS companies be certified under ISO 27701?

It is optional, yet very useful in bolstering privacy settings, customer confidence and making it easier to comply with regulations.

Is it possible to certify a company in GDPR?

No. No certification of GDPR. The companies are only able to prove that they adhere to the requirements of GDPR.

Is ISO 27701 relevant only to the companies that use cloud services?

No. It applies to any company that deals with PII, such as SaaS providers, data processors, and legacy IT providers.

Does implementing ISO 27701 for SaaS businesses become difficult?

This needs to be implemented in a structured way through documentation, privacy management, and risk evaluation; however, in situations where SaaS firms already have a well-established security culture, the migration is typically less challenging.

QIC Global Author
QIC Global Author

The author has been working with QIC Global for the last two years. He is a certified auditor who has spent more than 25 years performing analysis for compliance. At his leisure, he prefers investing his time in indulging in research on various ISO topics. He pens down this research and knowledge through blogs and articles. Most of his articles and blogs focus on different aspects of ISO certification audits. He wishes to continue with his research and writing.