The Information Commissioner’s Office (ICO) has issued the first fines for non-payment of the data protection fee to organisations across a range of sectors including business services, construction, finance, healthcare, retail and leisure. All organisations, companies and sole traders that process personal data must pay an annual fee to the ICO unless they’re exempt. Fines for not paying can be up to a maximum of £4,350. This follows regulations which came into force alongside the new Data Protection Act on 25 May 2018.
These first organisations have been fined for not renewing their fees following their expiry and more fines are set to follow. More than 900 notices of intent to fine have been issued by the ICO since September and more than 100 penalty notices are being issued in this first round.
The money collected from the data protection fee funds the ICO’s work to uphold information rights such as investigations into data breaches and complaints, its popular advice line and guidance and resources for organisations to help them understand and comply with their data protection obligations.
The ICO has grown over the last two years to meet its wider data protection remit and responsibilities following the General Data Protection Regulation’s (GDPR) inception. It now employs 670 members of staff.
Paul Arnold, deputy CEO at the ICO, said: “Following numerous attempts to collect the fees via our robust collection process, we’re now left with no option but to issue fines to these organisations. They must now pay these fines within 28 days or risk further legal action. You are breaking the law if you process personal data or are responsible for processing it and don’t pay the data protection fee to the ICO. We produce lots of guidance for organisations on our website to help them decide whether they need to pay and how they can do this.”
Fines range from £400 to £4,000 depending on the size and turnover of the organisation. Aggravating factors may lead to an increase in the fine up to a maximum of £4,350. All fines recovered do not go to the ICO. They go to the Treasury’s Consolidated Fund.
The data protection fee is set by Government which has a statutory duty to ensure the ICO is adequately funded, and is part of the Data Protection (Charges and Information) Regulations 2018. It came into force on 25 May to coincide with the new Data Protection Act 2018 and the GDPR. it replaces the need to notify or register with the ICO.
Under the funding model, which is set by Government, organisations are divided into three tiers based on their size, turnover and whether it’s a public authority or charity.
Larger organisations will be required to pay £2,900. The fee is higher because these organisations are likely to hold and process the largest volumes of data and therefore represent a greater level of risk.
Organisations that have a current registration (or notification) under the Data Protection Act 1998 – prior to 25 May 2018 – do not have to pay the new fee until that registration has expired.