How to Align Your Contracts for DPDPA Compliance?
The implementation of Digital Personal Data Protection Act, 2023 (DPDPA) requires organisations to adopt structured contractual safeguards with all third-parties who process personal data. Updating contracts is one of the fastest and most effective ways to strengthen compliance and reduce risk exposure.
1. Identify All Data Handling Contracts
Begin with a structured mapping exercise:
- Vendor agreements
- SaaS/subscription contracts
- Outsourcing & BPO contracts
- HR/payroll service providers
- Marketing, analytics, and cloud service agreements
- Inter-group data-sharing arrangements
This helps determine where personal data moves and which contracts need amendments.
2. Key Aspects for DPDPA-compliant Clauses
- Purpose limitation & documented instructions
- Confidentiality & security obligations
- Breach notification
- Sub-processor approval
- Return/Deletion obligations
- Assistance obligations
3. Strengthen Risk & Liability Allocation
DPDPA places primary liability on the Data Fiduciary, but contracts can ensure proportional risk sharing:
- Indemnities for data breach or non-compliance, termination for compliance failure
- Audit and inspection rights
- Insurance obligations
4. Address Cross-Border Transfers
Until rules notify specific safeguards and blacklisted countries, include:
- Transfer restrictions
- Assurance that personal data will not be moved outside India without authorisation
- Localisation commitments where required
To ensure smooth transition and execution, create a standard “DPDPA Contract Checklist” for legal and procurement teams and conduct ongoing monitoring of sub-processors and data flows. Contract alignment is a foundational step in DPDPA readiness. By updating clauses and contracts across all vendor contracts, organisations can reduce compliance exposure and establish a legally defensible posture under the DPDPA.
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