Data Processing Agreement (DPA)

What is a Data Processing Agreement (DPA)?

A Data Processing Agreement sets the 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—you need a DPA in place. Why? Because privacy laws, especially the GDPR, demand it.

But beyond compliance, DPAs help build trust and clarity between you and your partners.

Why you should care about DPAs

Whenever a data controller (that’s you or your organization) asks a 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
• Your vendor won’t go rogue with data
• Security and privacy controls are clearly documented

Without it, you’re taking on more risk 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 the processor brings in to help out—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.

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 vendors are following through
• Revisit the agreement if data use changes

The bottom line ...

A Data Processing Agreement helps you move fast while staying compliant. 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.