Data Processing Agreement (DPA)

What is a Data Processing Agreement?

A Data Processing Agreement sets clear rules for how third parties handle personal data on your behalf.

If you work with vendors who process data—like cloud providers, payroll platforms, or CRM tools—a DPA isn’t just a nice-to-have. It’s a legal must.

While DPAs were spotlighted by the GDPR, they’re now a requirement (or strong recommendation) in many privacy regulations across the globe—think U.S. state laws like CCPA/CPRA, Virginia's VCDPA, and frameworks in Canada, Brazil, and beyond.

Bottom line: a DPA isn’t just about compliance. It’s about trust, accountability, and reducing risk across your data ecosystem.

Why you should care about DPAs

Whenever a data controller (that’s you or your organization) asks a data processor (a third party) to manage personal data, a DPA becomes non-negotiable.

It’s your proof that:

• Everyone agrees on what’s being processed—and why
• Everyone agrees on who directs the processin—and why 
• Your vendor won’t go rogue with data
• Security and privacy controls are clearly documented

Without it, you’re taking on more risks than you may realize.

Who’s involved in creating the agreement?

Let’s break it down:

• Controller: Decides what data is collected and how it’s used.
• Processor: Carries out data processing based on the controller’s instructions.
• Sub-Processor: A vendor that the processor brings in to assist with processing—think infrastructure or storage services.

Each role comes with responsibilities. The DPA outlines them all.

What’s Inside a DPA?

A solid Data Processing Agreement covers more than just legal fine print.

Here’s what you’ll typically find:

Processing Summary

• What data’s being handled
• Who it belongs to
• How long it’s needed

Responsibilities

Controller: Makes sure data is collected legally and gives clear direction on what should be processed.

Processor: Follows instructions, keeps data safe, and doesn’t pass it on without approval.

Security Measures

• Encryption
• Access controls
• Breach response steps

Sub-Processors

• When they’re allowed
• How they’re held accountable

Ending the Relationship

• Return or deletion of data
• Final checks for compliance

How to keep your DPA working for you

DPAs aren’t “set it and forget it.” They need regular check-ins—especially as new tools, vendors, or regulations come into play.

Best practices:

• Review your DPA before signing new contracts
• Confirm your sub-processors are following through
• Revisit the agreement if data use changes

The bottom line ...

A Data Processing Agreement helps you move fast while staying compliant in regards to the management of personal data. It clears up who’s doing what, sets boundaries, and gives you tools to respond if something goes wrong.

If you’re working with any third-party service that touches personal data, a DPA isn’t just helpful—it’s your legal and ethical baseline.