Since LGPD’s enforcement, businesses across Brazil and beyond have faced significant challenges aligning their practices with the law. One of the most pressing concerns for companies is the risk of incurring severe and far-reaching LGPD fines.
This article provides a comprehensive overview of LGPD fines, with real-world examples of significant penalties and practical strategies to help your business remain compliant. Whether you’re a marketer, founder, or compliance officer, you’ll gain the insights needed to safeguard your company from potential financial risks.
What is LGPD?
The Lei Geral de Proteção de Dados (LGPD), Brazil’s General Data Protection Law, is a comprehensive legal framework to protect personal data privacy. It regulates the processing of personal data to ensure privacy and protect individuals’ rights. Like the European Union’s GDPR, it applies to any entity handling personal data in Brazil or data collected from Brazil, regardless of the entity’s location.
The LGPD grants individuals rights to access, correct, delete, and transfer their data. It requires organisations to have a legal basis for data processing, appoint a Data Protection Officer (DPO), and implement data security measures. The Autoridade Nacional de Proteção de Dados (ANPD), Brazil’s Data Protection Authority, oversees compliance and can impose penalties for violations.
Who can get an LGPD penalty?
Under the LGPD, any entity that processes personal data—whether a business, organisation or public authority—can face penalties for non-compliance. This includes both Brazilian entities and foreign entities that handle the data of Brazilian citizens. The law applies to all businesses that engage in the processing of personal data in Brazil, regardless of their location, or that process data collected in Brazil. Exceptions exist for data used exclusively for personal, non-commercial purposes, journalistic, artistic, or academic purposes, and certain governmental functions. The LGPD also aligns closely with international privacy regulations, such as the General Data Protection Regulation (GDPR) of the European Union.
Types of LGPD fines and penalties to avoid
The LGPD outlines several types of penalties businesses can face if they fail to comply with data protection laws. Understanding these fines and how they can be avoided is crucial for any business operating in Brazil or handling the personal data of Brazilian citizens. Below are the top five types of fines and penalties under LGPD and strategies to avoid them:
Warnings
A warning is typically the first step of enforcement, issued with a deadline for corrective measures. While no monetary penalty is immediately applied, failure to comply with the warning can escalate to more severe penalties.
Simple fines
A simple fine can be up to 2% of the company’s net revenue in Brazil for the previous year, limited to a maximum of R$50 million per infraction. This type of fine is often used to address initial infractions or less severe breaches.
Daily fines
Daily fines are imposed when a company fails to comply with LGPD regulations within a set timeframe. The daily fine continues until the issue is resolved, with a cap of R$50 million. These fines can accumulate quickly if corrective actions are not taken within a reasonable time.
Public disclosure of the violation
This penalty involves publicly disclosing the details of a violation, which can damage a company’s reputation and result in loss of consumer trust. It is often used to ensure transparency and accountability.
Blocking or deletion of personal data
This sanction can involve temporarily or permanently blocking access to personal data or requiring the deleting of personal data until compliance is restored. This measure can severely impact an organisation’s operations, especially if the data is crucial for its activities.
Partial or total prohibition of activities
It involves prohibiting the processing of personal data entirely or partially, depending on the severity of the infraction. This can severely impact or halt business operations, leading to significant financial and reputational damage.
Compensation for Damages
Organisations can be required to compensate data subjects for damages caused by non-compliance with LGPD. Depending on the scale and nature of the data breach or violation, this could lead to potentially high costs.
Case studies of LGPD fines
Case study #1: Telekall Infoservice
On July 6, 2023, the ANPD sanctioned Telekall Infoservice with fines totalling BRL 14,400 (around $2,938) for LGPD violations, including:
- Lack of a Data Protection Officer (DPO): A warning was issued for failing to appoint a DPO, violating Article 41 of the LGPD.
- Lack of legal basis for data processing: A fine of BRL 7,200 (around $1,469) for not having a legitimate legal basis for processing data, violating Article 7.
- Non-compliance with regulatory requirements: An additional fine of BRL 7,200 (around $1,469) for failing to comply with the Regulation governing administrative sanctions (Article 5).
This was the ANPD’s first sanctioning procedure, highlighting that even small businesses can face significant penalties under LGPD. The decision is not final and may be appealed.
Case study #2: State Government Employee Medical Assistance Institute (IAMSPE)
On October 6, 2023, the ANPD sanctioned the State Government Employee Medical Assistance Institute (IAMSPE) for two main violations:
- Delayed notification: IAMSPE notified 1.5 million affected data subjects about a cyber incident three months late.
- Insufficient security controls: Inadequate security measures allowed unauthorised access to personal data through four vulnerabilities in IAMSPE’s website API, though no sensitive data was exposed or altered.
The investigation began in March 2022 following a complaint. As the LGPD does not permit fines against public entities, IAMSPE received:
- Corrective orders: To update its public notification with specific required details.
- Compliance requirements: To report on the progress of its data protection program within one year.
This case highlights the ANPD’s enforcement of timely reporting and security standards under the LGPD.
Case study #3: Santa Catarina State Department of Health (SES-SC)
On October 18, 2023, the ANPD sanctioned the Santa Catarina State Department of Health (SES-SC) for four LGPD violations, including:
- Lack of data protection impact report: Failing to present the required report.
- Inadequate security measures: Insufficient security for storing and processing personal data.
- Delayed notification: Failing to promptly notify the ANPD and affected individuals of a security breach.
- Failure to provide information: Not responding to the ANPD’s requests for additional information.
SES-SC received four warnings and must take corrective measures, including notifying affected individuals and improving security. They have ten days to appeal the decision. This case emphasises the need for public entities to maintain robust data protection practices.
How to avoid LGPD fines and penalties?
Compliance with LGPD requires a proactive approach. Here are practical strategies to help your business stay compliant:
Understand the legal requirements
- Understand the scope of personal data you collect, process, store, and share, and ensure it fits within the LGPD’s definition.
- Ensure all data processing activities have a legal basis, such as consent, contractual necessity, legitimate interest, or other grounds defined by LGPD.
Implement data protection governance
- Appoint a Data Protection Officer (DPO) to oversee compliance with the LGPD and serve as a point of contact with ANPD.
- Create a data protection policy outlining how personal data is handled, including collection, processing, storage, and sharing.
- Regularly conduct Data Protection Impact Assessments (DPIAs) to assess data processing activities for risks to individuals’ privacy and take steps to mitigate those risks.
Conduct regular audits and reviews
- Perform regular audits of data processing activities to ensure compliance with LGPD.
- Ensure that contracts with third-party data processors or partners include LGPD-compliant data protection clauses.
Consent management
- Develop a robust consent management system to collect, store, and manage consent from data subjects transparently.
- Ensure that consent is obtained freely, informed, specific, and unambiguous and that it can be withdrawn easily at any time.
Keep detailed records of when, how, and for what purposes consent was given, and regularly review consent practices to ensure compliance with LGPD.
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- Allow data subjects to access their data and provide them with clear, accessible information on how it is used.
- Provide mechanisms for correcting inaccurate or incomplete data.
- Enable data subjects to request the deletion of their data under specific conditions and receive their data in a structured, commonly used, and machine-readable format.
Secure personal data
- Implement security measures like encryption and pseudonymisation to protect personal data from unauthorised access, loss, or breaches.
- Develop a data breach response plan to detect, respond, and notify the ANPD and affected individuals of data breaches promptly (within 72 hours).
Maintain transparency and accountability
- Clearly inform data subjects about data processing activities, including the purposes of data collection, how their data is used, and who it is shared with.
- Maintain records of data processing activities to demonstrate compliance with LGPD.
Regular training and awareness
- Conduct regular training sessions for employees on data protection practices, privacy principles, and LGPD requirements.
- Promote a culture of data protection awareness within the organisation.
Keep up-to-date with regulatory changes
- Monitor guidance from ANPD and stay informed about any updates or guidance from the National Data Protection Authority (ANPD) to ensure ongoing compliance.
- Be prepared to adjust your data protection practices in response to changes in LGPD regulations or enforcement practices.
FAQ on LGPD fines
Under the LGPD (Lei Geral de Proteção de Dados – Brazilian General Data Protection Law), the maximum fines for data processing agents who violate its rules are as follows:
- Simple fine: A fine of up to 2% of the gross revenue of the private legal entity, group, or conglomerate in Brazil for the preceding fiscal year, excluding taxes. This fine is capped at a maximum of R$ 50,000,000.00 (50 million Brazilian reais) per infraction.
- Daily fine: A daily fine may be applied, observing the total limit established for the simple fine (R$ 50,000,000 per infraction).
The National Data Protection Authority (ANPD) is the primary enforcer of Brazil’s LGPD. It oversees compliance, conducts investigations, issues fines, and can impose various sanctions. It also provides guidelines, handles complaints, raises public awareness, and collaborates with other authorities to ensure effective data protection.
Shreya is the Senior Content Writer at CookieYes, making sure every piece of content is engaging and audience-focused. Off the clock, you’ll find her happily lost in the world of fiction.
