Avoid Data Breach Fines in Hong Kong: Expert Tips

Protecting customer information is not just good practice — it’s the law. Under Hong Kong’s Personal Data (Privacy) Ordinance (PDPO), businesses are required to take reasonable steps to safeguard personal data. A single breach can have serious consequences, from reputational harm to fines of up to HK$1 million — and even higher if criminal liability is triggered. For SMEs, strong data protection is now essential to both compliance and customer trust.

What counts as a data breach?

The PDPO does not define “data breach” in statutory terms, but the Privacy Commissioner treats it as any incident in which personal data is:

• Lost
• Leaked
• Stolen
• Accessed, processed, or used without authorisation

Common Hong Kong examples include:

• Sending personal data to the wrong recipient (e.g. mis‑addressed emails)
• Unauthorised system access (hacking, malware infection)
• Lost or stolen devices containing unencrypted personal data
• Weak passwords or poor access controls allowing unauthorised entry
• Publishing personal data online without consent

Note: Even a small operational error — such as attaching the wrong file to a client email — may amount to a breach of the Data Protection Principles (DPPs) under the PDPO, particularly DPP4 (Data Security).

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What are the legal consequences under the PDPO?

Under the PDPO, the Privacy Commissioner for Personal Data can:

• Investigate suspected contraventions of the Ordinance
• Issue an Enforcement Notice under section 50, directing remedial action
• Prosecute certain offences directly (e.g. doxxing offences under s 64, failure to comply with an enforcement notice) or refer cases to the Department of Justice or Police

Important: There is currently no mandatory data breach notification requirement under the PDPO, but the Commissioner strongly recommends voluntary notification if the breach poses a real risk of harm to affected individuals. A 2021 government proposal for a mandatory regime has not yet been enacted as of 2025.

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How can businesses prevent data breaches?

Practical data security measures for 2025 include:

1. Train Employees
   
   • Provide regular training on handling personal data in compliance with the DPPs
   • Run phishing simulations and awareness briefings on password hygiene and secure email use
2. Encrypt Sensitive Data
   
   • Use strong encryption for devices, databases, and portable storage
   • Require multi‑factor authentication for system access
3. Limit Access
   
   • Apply the “need‑to‑know” principle
   • Revoke access immediately when employees leave or change roles
4. Update Software
   
   • Apply security patches promptly
   • Conduct regular IT security audits to identify vulnerabilities
5. Contractual Safeguards with Data Processors
   
   • If outsourcing data processing, use written contracts requiring compliance with PDPO security obligations (DPP4(2))

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What should you do if a breach occurs?

If a data breach happens:

1. Contain the Breach — e.g., disable compromised accounts, take affected systems offline, recover lost devices if possible.
2. Assess the Risk — determine the type of data involved, number of people affected, and potential harm.
3. Notify the Privacy Commissioner — while not mandatory, it is recommended where there is a real risk of harm. Use the Commissioner’s Data Breach Notification Form.
4. Inform Affected Individuals — where appropriate, so they can take protective measures.
5. Document the Incident — keep records of what happened, remedial actions taken, and follow‑up measures.
6. Review and Improve — update policies and training to prevent recurrence.

A clear incident response plan reduces exposure to liability and helps maintain customer trust.

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How can Ask.Legal help prevent data breaches?

Ask.Legal offers AI risk assessment tools that help businesses:

• Identify data-handling vulnerabilities
• Generate clear action steps to improve compliance
• Review contracts for weak data clauses
• Stay informed of legal updates around Hong Kong data breach laws

It’s fast, private, and designed for professionals with no time to waste.

Need help navigating this issue? Check out Ask.Legal — our AI-powered legal assistant is ready to help 24/7.

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