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What counts as sharing personal data with a vendor?
Sharing is broader than sending a spreadsheet by email. It includes disclosing personal data by transmission, dissemination or otherwise making it available. A vendor may receive data through an application programming interface, a hosted database, a support ticket, a backup service, remote administration, telemetry or a subcontractor.
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The first decision is not which contract template to use. It is who decides why the data is processed and how the relevant processing is carried out. The Information Commissioner’s Office (ICO) distinguishes a controller sharing with another controller from a processor acting on the controller’s behalf. Those relationships trigger different duties and different contractual routes.
Classify the vendor relationship before sharing data
Use the vendor’s actual decisions, purposes and means of processing, not the label used in its sales material. The same supplier can have different roles for different data flows, so record the role separately for hosting, analytics, customer support, fraud checks and any other operation.
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| Relationship | Who decides the purpose? | What the arrangement normally requires |
|---|---|---|
| Separate controllers | Each organisation decides its own purposes and means for the processing it carries out. | Document the disclosure, lawful bases, transparency information, minimisation, security and each party’s responsibilities. A processor-style Article 28 contract is not the correct legal basis for an independent controller. |
| Joint controllers | The organisations jointly determine the purposes and means. | Set out, in a transparent arrangement, who handles information duties, rights requests, security, breach response and other compliance tasks. The allocation cannot remove individuals’ rights. |
| Processor | The controller determines the purpose and gives documented instructions; the vendor processes on the controller’s behalf. | Use a written contract that meets Article 28 of the UK GDPR, control sub-processors and monitor performance. The processor also has direct statutory responsibilities. |
How to test whether a SaaS supplier is a processor
Ask what the supplier is permitted to decide. If your organisation determines the business purpose, the data fields, retention and the permitted operations, while the supplier provides the technical service under your instructions, it is likely to be a processor for that flow. If the supplier reuses the data for its own independent purposes, determines material purposes itself or combines your data with other data for its own objectives, it may be a separate controller for that activity.
Role is activity-specific. A cloud service can be your processor for storing customer records but a separate controller for its own billing, legal compliance or account-security records. Document each flow, purpose, data category, destination and decision-maker rather than accepting one blanket classification.
Lawful basis, transparency and data minimisation still apply
A vendor agreement is not a lawful basis. Before disclosure, the controller must identify an Article 6 basis for its own processing and check whether an additional condition is needed for special-category data. The basis should fit the purpose of the sharing, not be selected simply because a supplier contract is being signed.
Tell people who will receive their data
Privacy information should explain the relevant purposes and the recipients or recipient categories where required. If a new supplier changes who can access the data, update the notice before the disclosure where the UK GDPR requires advance information. Describing a recipient too vaguely to be meaningful can undermine transparency.
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Share only what the supplier needs
Apply purpose limitation and data minimisation to the fields, records and access methods made available. A support provider may need an account identifier and error log, not an entire customer history. Use scoped credentials, filtered exports, masked test data and separate production access where those controls meet the purpose.
Accuracy, storage limitation, integrity and confidentiality continue throughout the vendor lifecycle. Set retention periods, remove dormant accounts, correct inaccurate records and revoke access when a contract or role ends. Keep evidence of the decisions so the organisation can demonstrate accountability.
What an Article 28 data processing agreement must cover
When the vendor is a processor, the controller must use a binding written agreement (or equivalent legal act) containing the Article 28 requirements. Commercial terms can be negotiated, but they cannot contradict the UK GDPR or leave essential responsibilities unclear.
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| Contract area | What to specify |
|---|---|
| Scope and instructions | Subject matter and duration; nature and purpose; types of personal data; categories of data subjects; documented controller instructions; and a process for changing instructions. |
| Confidentiality | A duty for people authorised to process the data to keep it confidential, with appropriate commitments for employees and contractors. |
| Security | Appropriate technical and organisational measures, access controls, resilience, recovery, testing and any security evidence the controller will receive. |
| Sub-processors | Prior specific or general written authorisation, a way to object to proposed changes where applicable, and flow-down obligations equivalent to the processor’s duties. |
| Individual rights | Practical assistance with access, correction, deletion, restriction, portability, objection and other rights, within the controller’s response deadlines. |
| Incidents and impact assessments | Prompt notification of personal-data breaches, cooperation with investigations and assistance with data protection impact assessments and consultations where required. |
| End of service | Deletion or return of personal data at the controller’s choice, including copies and backups where feasible, plus a method for confirming completion. |
| Demonstrating compliance | Information needed to show compliance, audit or inspection rights, and cooperation with the controller’s reviews and regulator enquiries. |
Identify the parties, their contact points and operational owners. State who receives rights requests, who communicates with the ICO, how quickly incidents are escalated and which locations may process the data. A vague promise to provide “reasonable assistance” is harder to operate than named procedures, deadlines and evidence requirements.
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Due diligence and accountability cannot be outsourced
The controller must select a processor that provides sufficient guarantees and must be able to demonstrate compliance. Before signing, assess the supplier’s security architecture, access model, staff confidentiality, resilience, deletion process, incident history and use of sub-processors. Ask for evidence proportionate to the risk, such as independent assurance reports, penetration-test summaries, policies, recovery objectives and records of security testing.
Check whether the service permits the supplier to use customer data for product development, advertising, profiling or other independent purposes. Those uses can alter the role classification and require a separate legal analysis. Confirm that support staff, administrators and engineers can access only the systems and records needed for their work.
Do not assume liability language transfers all regulatory responsibility to the vendor. A processor has its own liabilities and responsibilities under the contract and the UK GDPR. The controller still owns the decisions about purpose, lawful basis, transparency, minimisation and supplier oversight.
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Personal data can leave the protection of UK data protection law when it is transferred outside the UK, which is why restricted-transfer rules matter. Look beyond the vendor’s headquarters and advertised hosting region. Map primary storage, backups, disaster-recovery sites, support desks, remote administration, monitoring systems, telemetry and every sub-processor.
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Identify who initiates the restricted transfer
Examples include a UK controller sending records to an overseas processor, or a processor sending data to an overseas sub-processor after the controller authorises that appointment. The contractual structure and the actual movement of data determine which party must arrange the transfer mechanism and keep the relevant records. State this explicitly instead of assuming the primary vendor has handled every onward movement.
Choose a lawful transfer route
For each restricted transfer, record the destination, importer, data categories, purpose, frequency and access method. Check whether the destination benefits from a current UK adequacy regulation. If it does not, use an appropriate safeguard, such as:
- the UK International Data Transfer Agreement (UK IDTA);
- the UK Addendum to approved EU standard contractual clauses, where its conditions fit the arrangement; or
- UK Binding Corporate Rules (UK BCRs) for an eligible corporate group.
Complete the relevant transfer-risk or data-protection assessment and record the reasoning. Consider the destination’s laws and practices, the type and sensitivity of the data, the likelihood of access by public authorities, and the safeguards available in practice. Add supplementary measures where the assessment identifies residual risk, such as stronger encryption, customer-held keys, pseudonymisation, access restrictions or tighter support procedures.
Authorised sub-processors and location changes should trigger the same review. A vendor’s promise that data is “hosted in the UK” does not answer where backups are stored or where an engineer can view a live session.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.A practical workflow for approving a vendor
- Inventory the flow. List the data fields, individuals, purpose, volume, retention period, systems, users and every country from which the data may be stored or accessed.
- Classify the role. Decide whether the supplier is a separate controller, joint controller or processor for each operation. Record the factual reasons and revisit mixed-role services.
- Document the legal basis. Record the controller’s Article 6 basis, any special-category condition, the purpose limitation and the minimisation decision before disclosure.
- Update privacy information. Identify relevant recipients or recipient categories and explain the purposes and international aspects required by the UK GDPR.
- Execute the processor contract where needed. Include all Article 28 elements, operational contacts, security evidence, rights assistance, incident deadlines, deletion or return and audit arrangements.
- Approve sub-processors. Obtain the required authorisation, review their locations and roles, and establish a process for objections and change notices.
- Complete the transfer assessment. Check adequacy; otherwise select the UK IDTA, Addendum or UK BCRs, document the transfer-risk or data-protection assessment and apply supplementary measures.
- Keep an audit trail and review it. Store the classification, contract, assessments, approvals, security evidence, deletion confirmation and review dates. Reassess when the vendor changes its service, sub-processors, destinations, purposes or legal terms.
Incident response and rights assistance
The agreement should require the vendor to notify the controller promptly after discovering a personal-data breach, provide the facts needed for risk assessment and cooperate with regulator or individual communications. Set a named escalation route that operates outside ordinary account-management hours when the service is critical.
Test how the vendor would locate, export, correct, restrict or delete one person’s data across production systems, logs, replicas and backups. Confirm how it handles an objection, portability request or erasure instruction and how it distinguishes your records from data it controls for its own purposes.
Require notice of material security changes, new sub-processors, new processing locations and changes in the vendor’s purposes. Review evidence periodically rather than treating the signature date as the end of due diligence.
Current-law check for UK vendor arrangements
The current text of the Data Protection Act 2018 records amendments made by the Data (Use and Access) Act 2025, including provisions with commencement information extending into 2026. ICO guidance pages also warn that some material is under review. Before publishing a definitive internal checklist or signing a new arrangement, check the live legislation and the latest ICO updates, then record which version of the law and guidance the assessment used.
When a vendor should not receive the data
- The organisation cannot explain a lawful basis or the purpose of the disclosure.
- The supplier refuses to identify its sub-processors, access countries or independent uses of the data.
- The proposed contract omits Article 28 requirements, breach cooperation, deletion or audit evidence.
- The transfer assessment identifies unacceptable risk and no adequate safeguard or supplementary measure is available.
- The data requested exceeds what is necessary for the service, or access cannot be limited and monitored.
In those cases, redesign the data flow, remove unnecessary fields, choose a service with workable controls or stop the disclosure. A supplier’s convenience does not override the controller’s accountability.
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