Privacy And Data Security Due Diligence: The Importance Of Implementing Post-Closing Improvements

Privacy law compliance and data security are increasingly material considerations in M&A transactions. Purchasers and sellers alike have an interest in mitigating risk and ensuring compliance with applicable laws and standards. Sellers enhance the value of the target business and minimize their indemnification risks when they prioritize privacy and data security and engage in a transparent sales process. Through effective due diligence, purchasers can uncover deficiencies and create a plan to resolve concerns, avoid violations of law, reduce liability, and prevent reputational harm.

In this article, we review the basics of privacy and data security due diligence and common issues that arise in M&A transactions. Finally, we analyze the importance of remedying deficiencies after closing a transaction.