We recently received an inquiry from our first European customer, and they're asking us to sign a Data Processing Agreement (DPA) before moving forward with a trial. I had to look up what a DPA is, as I'm not very familiar with compliance matters. From what I've gathered, it's a legal contract that outlines how we handle their data, as required under GDPR. However, we've never dealt with this before since our customers have all been based in the US.
I found a few templates online, but they're filled with complex legal jargon regarding sub-processors and data transfers, which nobody on our team really understands. Do most SaaS companies have a standard DPA template they distribute, or does it need to be customized for each customer? Also, if we sign one with this EU customer, will we need to start offering it to our US customers as well? I apologize if these questions seem basic; I just want to ensure we are compliant and handle this correctly.
5 Answers
Honestly, this is something best directed to your company's legal department. If you don’t have one, it might be a good idea to let management know that these are questions that require professional legal advice. And maybe consider updating your resume while you're at it!
You're going to need to involve your legal team on this one to manage the details properly.
Short answer: yes, if you're dealing with EU customers, you definitely need a DPA since it's a requirement under GDPR for processing personal data on their behalf. We tried to create our own DPA from templates, but it turned into a complicated mess. In the end, we chose to use a service called Delve because every customer had different demands, and it was too technical for our team to navigate.
As for US customers, you’re not legally obligated to provide a DPA, but some larger companies might request one as part of their vendor policies. We ended up putting our DPA on our website for easy access, which has worked out well. Just be sure you know all your sub-processors before you sign a DPA, since you'll need to list them. Good luck!
Definitely read up on GDPR before signing any agreements so you're fully informed. Here's a helpful checklist for US companies: https://gdpr.eu/compliance-checklist-us-companies/.
A DPA is standard and necessary if you're acting as a processor under GDPR. You might also want to be prepared to provide one to US clients if they ask for it. There are plenty of boilerplate templates available, but make sure your legal team reviews it before sending anything out.
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