Lawful Processing of Personal Data: What the Law Requires

Imagine you are walking into a coffee shop and order your favourite latte, and they ask for your phone number, email, and address so you can just pay. You would probably pause and wonder, Why do they need all your information? And now you think of this scenario on a global scale, where companies, both small and massive, collect, store, and share customer data every single day. That’s where laws governing the lawful processing of personal data enter, making sure that individual information is handled fairly, transparently, and responsibly.

But what does “lawful processing” mean? And what do all organizations need to do to comply? Let’s break it down in a practical way.

At its fundamental, lawful processing means that when a company collects or uses personal data, it needs to have a valid legal reason for doing so. Personal data means any information that can identify someone directly or indirectly like names, addresses, ID numbers, online identities, and even something as unique as your voice or biometric data.

Laws such as the General Data Protection Regulation (GDPR) in Europe, the California Consumer Privacy Act (CCPA) in the U.S., and similar frameworks across different nations lay down strict conditions under which data can be processed. The idea is simple: people should not feel like they are giving up their privacy every time they sign up for a service and make an online purchase, or download an app.

Under GDPR, there are six lawful areas that organizations can depend on. Think of them as “permission slips” that can justify why this personal data is being collected and used.

1. Consent authority

This is where individuals obviously agree to the use of their data, like ticking a box to receive marketing emails. But this law requires consent to be given, specific, and informed. No pre-checked boxes, no hidden fine print.

Example: A health application app asking if it can access your location to suggest nearby workout areas. If you say “yes,” that’s valid consent.

2. Contractual Requirement
 Data can be processed if it’s required to fulfill a contract. For example, when you buy something online, they need your address to deliver the package.

Example: Buying a laptop —your e-commerce website needs your address to deliver the laptop

3. Legal Responsibility
Sometimes, processing is not about choice—it’s about compliance with the law. Employers are required to process employees’  tax details.

Example: Banks that report suspicious transactions under anti-money laundering regulations.

4. Vital Interests
This law only applies when processing data is necessary to protect someone’s life. While it rarely covers emergencies.

Example: A hospital sharing a patient’s medical data with another hospital during emergency treatment.

5. Public Task
Applicable mainly for government entities, and applies when data processing is needed to perform tasks in the public interest.

Example: A local municipality collects citizens’ data for public health monitoring.

6. Legitimate Interests
Businesses can process data if it is necessary for their legitimate interests, provided it does not override the rights and freedoms of individuals.

Example: Fraud prevention systems that analyze customer transactions.

Legal rules alone aren’t enough. Transparency is a basis of lawful processing. Organizations must clearly explain:

• What data do they collect
• Why do they collect it
• How long will they keep it
• Who will they share it with

This is where privacy notices or privacy policies enter. But here’s the catch—they should not read like a 30-page legal document. Regulators expect these notices to be simple, plain-language explanations.

Many organizations have learned the hard way that ignoring lawful processing requirements can be at a high cost.

• In 2019, Google was fined €50 million by French regulators for a lack of transparency in how it obtained user consent for personalized ads.
• Smaller businesses have also been fined, not for malicious intent, but for overlooking basics like failing to obtain proper consent or retaining data longer than it is necessary.

Beyond penalties, the reputational damage can be brutal. Trust is very weak, and in today’s digital economy, once consumers feel their data is not respected, they will walk away and tell others to do the same.

So, what can organizations do to stay on the right side of the law? Here are a few practical steps:

1. Map Your Data – Know which type of personal data you collect, why you collect it, and where it is stored.
2. Choose the Right Legal Basis – Do not depend on consent if another basis (like contractual necessity) is more suitable.
3. Keep Records – Keep a record of your decision-making process. Regulators often ask for evidence of compliance.
4. Train your employees – Employees are the frontier, and they need to understand the importance of handling data legally.
5. Review Policies Regularly – Laws change, and so do business practices. Regular audits ensure continued compliance.

It is easy to think of data protection laws as organisational red tape. But at the fundamental level of lawful processing lies something more fundamental: respect for people’s privacy and dignity. It is about treating every single one not as data points, but as human beings who deserve control over their information.

Lawful processing of personal data goes beyond being a legal tickbox—it represents a commitment to fairness, transparency, and accountability. Whether it’s obtaining valid consent, honouring contractual responsibilities, or safeguarding vital interests, organizations must treat personal data with integrity.

For business, this is not just about avoiding hefty fines; it is about building trust and credibility in an era where consumers are more aware of their rights than ever. For individuals, it’s comforting that their privacy is not treated as just a regulatory requirement, but it is genuinely respected and protected.

Organizations often understand the importance of GDPR but still struggle with applying its rules to real workflows, especially when determining the correct legal basis, documenting decisions, or rewriting notices in a way people can actually understand. Azpirantz helps bridge that gap by pairing deep GDPR expertise with practical, business-ready guidance. Our consultants work with your teams to map data flows, validate lawful grounds, refine consent mechanisms, and build plain-language privacy notices that meet regulatory expectations. And because most companies operate across more than one jurisdiction, we also align these practices with frameworks like CCPA, PDPL, LGPD, and other regional laws, ensuring consistency without losing local accuracy. With Azpirantz, compliance becomes a clearer, more confident process, rooted in transparency, accountability, and respect for individuals.

*This content has been created and published by the Azpirantz Marketing Team and should not be considered as professional advice. For expert consulting and professional advice, please reach out to [email protected].