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The impact of Brexit on CISOs

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UK firms aren’t ready for a no-deal Brexit
Large numbers of small and medium-sized tech businesses haven’t made any preparations for the UK leaving the EU – and many believe the government isn’t listening to the concerns they have ahead of Brexit.

Today we see some signs of optimism from the EU and the UK about the potential to conclude a withdrawal agreement following private talks between the UK and Ireland yesterday. Since I last wrote a blog about this, we have seen a change of UK government, a brand-new UK negotiating position, a Conservative Party leadership contest, and an EU watching on the sidelines wondering what on earth is going on in the UK politically. 

We can’t predict whether Brexit will really happen on October 31 and whether a deal will be concluded or not. However, we do now know that we are likely to leave with a withdrawal agreement that affects security at the institutional level — not dissimilar to the broad outline of what Theresa May and the EU concluded in November 2018 — or that we will leave all current security and defense cooperation arrangements. For security leaders wondering how all of this may affect them, we advise CISOs to focus on three primary areas of concern: 

  • International data flows between the UK and the EU. We know that, one way or the other, the continued legal basis for data flow relies on the UK’s data protection regulatory regime being judged equivalent to the EU’s. The various parties would begin working on this key adequacy decision, as it is known, following the UK’s exit from the EU (deal or no deal). While there are a lot of similarities with the regimes as they currently stand, there is no way of guaranteeing that the decision will occur and in what time frame. In the event of a “no-deal Brexit,” the legal default will be that the regimes are not equivalent and the EU will treat the UK as a third country, invalidating the legal basis currently used to promote legal data transfer between the UK and the other EU member states. We recommend that CISOs and DPOs start looking into alternative means now for guaranteeing the legal basis for their international data flows between the UK and EU. This can either be through model clauses or a binding corporate rules program, for example, which are already widely used for transfers outside of the EU. 
  • Staffing. Thankfully, both sides have agreed that whether a deal is agreed or not, they will work hard to provide some certainty to EU and UK citizens working outside of their home countries. For CISOs, this means that your staff will need reassurance and support if they need help with application procedures or, in some cases, the costs of applying. The area that is going to be most problematic is in the realm of recruitment — a challenge that is already difficult enough with the security skills shortage. Brexit will require you to think more carefully about where you deploy your staff and security services. Restrictions on the numbers of EU citizens entering the UK and vice versa are generally expected, so review your operating model carefully to mitigate the impact that restrictions on freedom of movement could bring to your security organization structure and headcount deployment. In addition, consider the implications for business travel for any service providers and staff supporting you from outside of your main headquarters locations. 
  • Regulatory relationships and obligations for reporting cybersecurity breaches. Whatever your views on it, the EU has been one of the most active legislators of cybersecurity and privacy regulations, creating a myriad of regulatory relationships across the EU. Many of these, particularly NISD, PSD2, and GDPR, contain requirements to report certain types of security events and incidents to regulatory bodies. The relationships have been set up, and many organizations in the scope of this regulation will need to review and update regulatory reporting lines, as current regulatory relationships may change. Review and update incident response plans and supporting operational processes carefully to ensure that you capture these changes in regulatory relationships. 

While there are many other implications to Brexit for CISOs to consider, these are some of the most common that come up in our conversations with clients. We will continue to watch the politics unfold and hope to gain clarity as to what will happen next. 

This post was written by Senior Analyst Paul McKay and originally appeared here. 

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