Binding Corporate Rules: Security for international data transfers - Privalexx Ukraine

Binding Corporate Rules are a key instrument for companies from Ukraine that process the personal data of EU citizens in order to carry out international data transfers in compliance with the law. The increasing requirements of the GDPR show how important binding data protection regulations are for entering the European market. But what challenges do Ukrainian companies without a registered office in the EU face and how can data transfers be ensured in compliance with EU data protection law? These are questions that concern many data controllers. Binding Corporate Rules give companies the opportunity to comply with global data protection requirements, minimise liability risks and establish legal certainty vis-à-vis European supervisory authorities.

International data transfers: challenges in data protection

International data transfers play a decisive role for many companies when it comes to efficiently organising business processes. Especially for Ukrainian companies that offer products, services and applications for the EU market, data protection is a top priority. The biggest challenge is that personal data cannot be transferred to third countries without further ado. Compliance with the General Data Protection Regulation (GDPR) requires special guarantees and transparency when processing this data. Any company that regularly realises international data transfers must ensure the legality of its data transfers. It is important to establish effective mechanisms that guarantee the high European data protection standard outside the EU and avoid possible legal consequences. Binding corporate rules offer a structured and verifiable solution here.

Legal background for Ukrainian companies

Special regulations on data protection and data transfer apply to Ukrainian companies that work with the personal data of EU citizens. The GDPR stipulates that international data transfers are only permitted under strict conditions. The most important requirements for companies are

Proof of compliance with the European data protection standard
Implementation of binding corporate rules for group-wide data protection
Examination of mechanisms for international data transfers, especially in the absence of an adequacy decision for Ukraine
Regular review and adjustment of data protection measures

Binding corporate rules are one way of ensuring that data flows within the Group are legally compliant. They regulate the handling of personal data in a binding manner and offer supervisory authorities transparent control mechanisms. The European Commission and national data protection authorities review and approve these rules. This is the only way that data can be transferred within a group to third countries such as Ukraine. The significance of the Binding Corporate Rules lies in the fact that they create a standardised data protection strategy for international data transfers. This is essential for Ukrainian companies that are active on the EU market in order to avoid penalties, loss of reputation and business risks.

Making data transfers legally compliant – practical solutions

The legally compliant transfer of data from the EU to Ukraine is a focus for many companies. Companies that exchange personal data with each other or with subsidiaries must also guarantee EU data protection outside Europe. For this purpose, Binding Corporate Rules (BCR) are a tried and tested instrument for implementing the legal requirements in a standardised and transparent manner.

Binding Corporate Rules are drawn up internally and regulate how personal data is processed and protected throughout the Group. They contain, among other things

The principles and objectives of the internal data protection model
Rules on international data transfer and data transmission
Measures for IT security and safeguarding the rights of data subjects
Guidelines for specific work processes (e.g. personnel files, customer management)
Controls and regular audits

Ukrainian companies contact a lead EU data protection authority for approval of the Binding Corporate Rules. Once they have been audited, the binding rules are recognised throughout the Group as proof of appropriate data protection measures. This creates trust among business partners, customers and supervisory authorities.

In addition to Binding Corporate Rules, there are alternative or supplementary approaches for Ukrainian companies:

Standard Contractual Clauses of the EU (SCC)
Approved rules of conduct (Code of Conduct)
Certification procedure in accordance with Art. 42 GDPR

The seamless documentation of all data transfer processes remains a current challenge, especially in complex supply chains. All processes must be continuously monitored and adapted to current data protection standards.

Practical example

A Ukrainian IT group offers cloud services for European companies. Without Binding Corporate Rules, every single international data transfer would have to be regulated and documented with standard contractual clauses. With BCR, all data traffic between group companies can be handled flexibly but with legal certainty – from HR data to customer support. This reduces administrative effort and increases legal certainty.

Binding Corporate Rules not only offer Ukrainian groups a competitive advantage when accessing the European market, but also minimise the risk of data protection violations and possible fines. The introduction is complex, but pays off in the long term through legal certainty and trust.

Summary: utilise advantages, avoid risks

Binding Corporate Rules are a strategic tool for Ukrainian companies to organise international data transfers to group companies in a legally secure manner. They not only enable compliance with European data protection standards, but also strengthen the trust of customers and partners. Those who implement the requirements at an early stage minimise liability risks and are optimally positioned for business relationships with European companies. Let experienced data protection consultants support you in the introduction and implementation of Binding Corporate Rules in order to realise data protection and data transfer professionally and compliantly.

Binding Corporate Rules (BCR) are mandatory data protection regulations that multinational companies apply for the internal handling of personal data from the EU. They define binding standards for data protection when data is transferred within a corporate group, for example, between branches in different countries. BCR are approved by data protection authorities and replace standard contractual clauses or other mechanisms for international data transfers within a corporate group. The goal is to ensure a consistently high level of data protection regardless of location.

Binding Corporate Rules enable legally secure international data transfers within a corporate group, including outside the EU. They establish binding data protection regulations for all affiliated companies worldwide. Once approved, BCR allow data to be transferred, for example, from the EU to locations in countries like the USA or Ukraine without violating the GDPR. The prerequisite is that all locations adhere to the same data protection principles.

Binding Corporate Rules provide companies with a uniform, group-wide solution for protecting personal data during internal transfers. They enhance legal certainty, simplify processes, and strengthen the trust of business partners and customers in the company’s data protection practices. Companies also gain competitive advantages by positioning themselves as GDPR-compliant to authorities and clients. BCR reduce administrative efforts compared to individual standard contractual clauses for each data transfer.

Binding Corporate Rules are aimed at international corporate groups or conglomerates whose entities transfer personal data from the EU or the European Economic Area (EEA) among themselves. Ukrainian conglomerates or other non-EU companies without a presence in the EU can also use BCR if they regularly process personal data of EU citizens within the group and want to demonstrate that these transfers are GDPR-compliant.

Binding Corporate Rules require approval from the competent European data protection authorities. Companies submit their BCR along with comprehensive evidence of implementation to a lead data protection supervisory authority, which reviews compliance with GDPR requirements. Following a positive evaluation, a consultation with other affected authorities takes place in the so-called consistency mechanism. Only after formal approval are BCR valid as a legal basis for internal data transfers.

Companies must implement detailed data protection principles within the framework of Binding Corporate Rules, including transparency obligations, data subject rights, security measures, and liability and enforcement options for affected individuals. Additionally, a procedure for regular review and updating of the rules is required. All employees must be trained. BCR must be binding for every group company and ensure enforceability of compliance, including for EU citizens.

Binding Corporate Rules ensure that personal data of EU citizens is processed outside the EU in accordance with GDPR standards. They obligate all involved entities within the group to implement technical and organizational data protection measures, fulfill information obligations toward data subjects, and guarantee data subject rights, such as access or deletion. Through internal audit mechanisms and enforceable rights for data subjects, a high level of data protection is maintained even during international data transfers.

Unlike standard contractual clauses or the Privacy Shield, Binding Corporate Rules are specifically designed for internal data transfers within a corporate group. They apply bindingly to all parts of the company worldwide. While mechanisms like standard contractual clauses must be concluded separately for each data transfer, BCR offer a group-wide, uniform solution. They are tailored to the corporate group, more complex to implement, but provide a sustainable, flexible, and legally compliant framework.

Binding Corporate Rules are particularly relevant when personal data is transferred within a corporate group, for example, to Ukrainian conglomerates or branches. Since Ukraine is not part of the EU and lacks an adequacy decision, special guarantees are required for data transfers. BCR ensure that EU data protection standards are upheld even during transfers to Ukraine. They provide legal certainty and help companies avoid fines and sanctions.

Companies begin by analyzing all internal data flows and business units involved in international data transfers. Subsequently, group-wide binding data protection regulations that meet GDPR requirements are developed. Internal processes, training, and control mechanisms are established. After drafting and internal approval of the BCR, they are submitted for approval to the lead EU data protection authority. Only after completion of the procedure can BCR be used as a basis for internal data transfers.