Modern digital supply chains are complicated. As ever more businesses outsource ever more business functions to focus on their core responsibilities, those chains stretch around the world and involve ever more links.

This has significant economic, security, and privacy ramifications. Tracking the movement of personal data across digital supply chains is difficult— but it is decidedly not optional. Privacy regulations such as the EU’s General Data Protection Regulation (GDPR) require companies to know where their personally identifiable information is at all times. 

What Is a Data Subprocessor?

A data subprocessor is a link far down that digital supply chain. First is the data controller, which possesses the information legally. The controller might then outsource handling of that data to a data processor — who might then sub-contract some part of the processing to a subprocessor. 

The data controller is ultimately responsible for protecting the personally identifiable information (PII) it has collected and handed off to processors and subprocessors. By the same token, however, processors and subprocessors have a legal duty to follow the same privacy regulations as the data controller. 

Data Subprocessors & Compliance Frameworks

The GDPR explicitly requires that subprocessors be bound by a contract that imposes the same data protection duties on them that the data processor has with the data controller. Sub-processors are likewise held liable for any breaches or noncompliance under the law and may face direct fines.

The California Consumer Privacy Act, in contrast, does not explicitly define sub-processors. It does discuss “service providers,” which act similarly; but subprocessor responsibility is significantly less rigorous since primary liability is generally held by the “business” (similar to the data controller in GDPR), rather than the service provider itself.

How do you identify data subprocessors?

Consider the following questions to evaluate whether a company operates as a data subprocessor:

  • Does the business process personal data in the name of another organization?
  • Is the business’s data processing purpose established by someone else?
  • Does a contract with another company cover the company’s data processing activities?
  • Does the organization treat personal data under the express instructions of another entity (such as a data processor)?

Data Subprocessor Compliance Duties & Responsibilities

As mentioned before, data subprocessors perform operational duties using personal data on behalf of data processors.

They mainly provide data-driven services such as cloud storage infrastructure, CRM, and email marketing. Because companies handle data, they must adhere to particular criteria to provide GDPR-compliant services.

A data subprocessor is responsible for the following compliance objectives:

Data Security and Confidentiality

Data subprocessors must implement robust security measures to safeguard personal information from unauthorized access, breaches, and leaks. Controllers should engage only subprocessors that meet appropriate security criteria.

If your subprocessor lacks proper protection, your data may be jeopardized. This might result in penalties, poor publicity, and legal action against your firm.

Acceptable security measures include, but are not limited to:

  • Firewalls
  • Access controls
  • Multi-factor authentication
  • Regular data risk assessments
  • Data encryption or anonymization
  • Privacy awareness training for employees

Implementing Security Measures

Data processors must apply suitable technical and organizational measures to guarantee a level of security proportionate to the risk. This includes safeguarding data against unauthorized or unlawful processing, accidental loss, deletion, or damage.

Following Data Controller’s Instructions

A data processor’s adherence to the data controller’s directives is critical to GDPR compliance. Processors are responsible for handling data only as directed by the controller, who sets the goal and context of processing.

This stringent compliance prevents unlawful data usage and protects the processor from accidentally taking on the role (and accompanying obligations) of the data controller. Stepping beyond those bounds violates the GDPR while jeopardizing the controller-processor relationship’s integrity and trust.

Maintaining Records of Processing Activities

Processors must retain complete records of all types of processing activities performed on behalf of a controller.

These records must include information such as processing aims and a description of data subject and personal data categories, which are required to demonstrate GDPR compliance.

Upholding Data Subject Rights

Data processors must help data controllers maintain data subjects’ rights under the GDPR. This includes handling requests for data access, correction, deletion, and portability.

When a data subject exercises his or her rights, the processor must guarantee that its infrastructure and operations can meet these demands promptly. This requires processors to have efficient systems to accommodate data subjects’ rights promptly, supporting the regulation’s person-centered approach to data privacy.

Reporting Data Breaches

Data processors must quickly notify their data controllers when a breach happens.

The GDPR requires that this notice be sent without undue delay, giving the controller as much opportunity as possible to take corrective action.

This prompt action is critical to minimizing harm and meeting the controller’s requirement to notify the appropriate regulatory authority of the breach within 72 hours of becoming aware.

A processor’s prompt response in the event of a data breach is a legal duty and a critical component of the trust that data controllers and data subjects put in the processors.

Best Practices for Subcontractors

Consider the following recommended practices to maintain compliance and to secure your users’ data effectively.

Data Security

Investing in adequate security measures is a critical component of GDPR compliance. This includes using cutting-edge technology to protect personal data against unauthorized access, disclosure, change, and destruction.

Strong encryption, firewalls, anti-malware software, and secure data storage systems are examples of such methods.


Maintaining detailed records is also necessary. This isn’t simply about tracking the data you acquire and handle; it’s about monitoring the whole lifetime of personal data, including how and when consent was gained, how the data is used, and how you respond to data breaches.

Good documentation not only demonstrates compliance. It also serves as a roadmap for your data protection policy.


As a data processor, you must maintain open and transparent communication with the data controllers. Prepare to give a thorough accounting of data processing activities and respond quickly to data subject access requests.

Employee Training

Your staff members should be well-versed in GDPR and understand their responsibility in safeguarding personal information.

Training should include the principles of data protection, the intricacies of GDPR, and the necessity of adhering to your organization’s data protection policy.

Regular training sessions assure that personnel are informed of their roles and the penalties for noncompliance.

Regular Audits

Regular audits assist in maintaining continuing GDPR compliance. These audits should focus on your data processing activities, security measures, documentation, and respect for data subjects’ rights.

Audits can identify holes in your data protection framework and expedite remediation, reducing the risk of noncompliance.

Data Impact Assessments

Before implementing new procedures or technologies that handle personal data, it’s wise to complete a data protection impact assessment.

These audits check how new activities influence personal data security and privacy and whether they meet GDPR regulations.

Key Considerations When Using Data Sub-Processors With AI Tools

With the rapid expansion of artificial intelligence (AI) products that use large language models (LLMs), abiding by data privacy standards may become even more difficult. Ideally, you would limit sub-processors access to personal data to the bare minimum required.

For example, if you’re running a market research project with a service like ChatGPT, sanitize personal information such as emails, phone numbers, and so forth. Similarly, if you’re using generative AI to create a marketing blog post, you probably won’t need to cue the tool with people’s names or contact information.

Therefore, you must:

  • Understand the data flow of your subprocessor and their policies;
  • Sign a comprehensive Data Processing Agreement (DPA), covering all compliance requirements;
  • Opt-out of training on sensitive information;
  • Track closely the use of data in a centralized repository.

ZenGRC Offers Integrated Risk and Compliance Management Solutions

The risk management and assessment process, including internal audits, can significantly strain your firm. ZenGRC is a governance, risk management, and compliance platform that may help you speed audit procedures by gathering and organizing all relevant information.

Instead of handling your compliance requirements using spreadsheets, use ZenGRC to automate documentation and audit management across all your compliance frameworks. ZenGRC’s compliance, risk, and workflow management software is straightforward.

ZenGRC includes a variety of compliance frameworks and standards for easy implementation, including GDPR, PCI, HIPAA, and SOC 2.

One-to-many control mapping makes matching internal controls to numerous standards easy, allowing you to monitor GDPR compliance alongside other frameworks. That, in turn, makes compliance management more accessible.

ZenGRC also serves as a single source of truth, so that your business is always compliant and audit-ready. Policies and procedures are versioned and readily available in the document repository. Workflow management technologies include essential monitoring, automated reminders, and audit trails. Insightful data and dashboards identify gaps and high-risk regions.

Schedule a demo today to learn how ZenGRC can assist you with compliance and vulnerability management.