WHY DO COMPANIES CARE ABOUT CROSS-BORDER DATA PROCESSING, AND WHAT ARE THE RELEVANT LAWS?
Parkhill Venture Counsel, P.C.
Many companies large and small have operations outside the United States. It’s common for early-stage companies to hire engineers and other staff in other countries, and as businesses grow they certainly look to expand operations globally. There is a global marketplace for talent and real efficiencies to be gained from worldwide operations ranging from lower payroll costs to 24×7 support across time zones.
What companies learn, however, is that many of their customers are very attentive to cross-border issues and in many cases ask that their vendors restrict cross-border transfer and processing of data. This is a particularly common situation for SaaS companies because data processing is a key part of their businesses. It can be difficult sometimes to tell whether specific issues or more generalized concerns drive these requests.