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Privacy Policy – Why every business needs it?

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Privacy has been a concern for the global fraternity for the past few decades. With businesses marking their presence over the internet, internet users are prone to the risk of breach of their privacy.

Here comes the role of privacy policy. It minimizes the risk of breach of privacy suffered by internet users and also protects businesses from frivolous litigation.

What is a Privacy Policy?

All businesses having their website, need a privacy policy. A privacy policy is a legal document that states how the concerned business entity would utilize the data or information provided by its users on its website.

A Privacy Policy mentions what information would such a business entity maintain in its records and for what purposes. A Privacy Policy further elaborates what legal obligations it fulfills by using the information provided by its users.

Importance of a Privacy Policy

To promote the reach of one’s website, third-party services like Google AdSense or Google Analytics are used. Such services need that the subject website should provide an exhaustive privacy policy.

Also, a Privacy Policy maintains the trust of the website users and keeps their faith intact. It makes their experience seamless as the users don’t worry about the potential threats to their personal information collected by the website.  

Contents of a Privacy Policy

Some businesses resort to privacy policy generators available online due to their cash crunch. However, it is advisable to hire a lawyer to draft the same as the needs of every business are different. A business lawyer would draft an apt privacy policy that will suit the needs of the website and its users as well.

A Privacy Policy must contain the answers to the following questions:

i) What type of personal information of users is collected?

ii) How the personal information of users is collected?

iii) What is the purpose of collecting the personal information of users?

iv) How the personal information of users would be protected by the website?

v) Where and for how long the personal information of users would be stored by the website?

vi) What rights do the users have against the website?

vii) Whether the website uses any cookies? If yes, then the link to the cookie policy should be provided.

Law on Privacy Policy

The legal framework developed by different countries require that a business must inform its users about how it would use their personal information.

The General Data Protection Regulation (GDPR), developed in European Union is so far the most comprehensive privacy legislation in place.

In India, there is no legislation on Privacy Policy and the Information Technology Act, 2000 only provides for punishment in case the personal information of a user is leaked in an unauthorized manner.

Consequences of non-compliance

In different countries, there are different penalties for non-compliance with privacy policy rules. Not providing a privacy policy at all, or non-exhaustiveness of the provided privacy policy, and so on attract different consequences.

It cannot be said that the consequences that might follow from non-compliance in California would follow in India too.


A Privacy Policy is a legal document that every website needs to provide the terms of the use of personal information of its users. It is important to have a well-drafted privacy policy as it maintains the trust and faith of users in the website. A privacy policy should be as exhaustive as possible to leave no room for doubt in case a matter of privacy or data breach arises. There are different privacy legislations in different jurisdictions. Therefore, non-compliance would attract different consequences everywhere.