PDP Law: Understanding Data Privacy and Steps to Start PDP Law Compliance for Businesses

In almost every company today, personal data is scattered everywhere. Customer data exists in CRM systems, marketing applications, sales team emails, and even simple spreadsheets. Employee data is stored in HR systems, payroll vendors, cloud storage, and even personal laptops.

In daily operations, this condition is considered normal. Systems run, businesses grow, transactions occur. Problems only arise when there is an audit, a data breach incident, or a clarification request from the regulator.

At that point, many management teams only realize that they do not actually know what data they have, where it is stored, who accesses it, and what the legal basis is.

A simple question from an auditor can immediately make the entire team panic:
“Where is the evidence of PDP Law compliance?”

The Personal Data Protection Law (UU PDP) exists to protect consumer data. And for businesses, this consumer data is both an asset and a real source of business risk.

The PDP affects how companies manage data, build customer trust, and protect their reputation in a digital ecosystem that is increasingly sensitive to privacy issues.

What Is the PDP Law (UU PDP)?

UU PDP is a regulation that governs how businesses collect, use, store, share, and protect personal data throughtout all operational activities.

These provisions are officially regulated under Law Number 27 of 2022 on Personal Data Protection, which serves as the national legal basis for privacy and data protection management in Indonesia.

From the regulator’s perspective, the PDP Law aims to ensure that personal data is not treated carelessly, misused, or stored without control.

From a business perspective, the PDP Law is a framework that forces companies to be more disciplined in managing data assets that have long been considered “just operational data.”

The emergence of the PDP Law did not occur immediately. Business digitalization, cloud usage, third-party system integration, and the increasing number of data breach incidents have made personal data protection a strategic issue, no longer merely an IT or legal issue.

In practice, the PDP Law seeks to ensure one thing: personal data is not treated arbitrarily. Every piece of data you collect and manage has an owner, and that data owner has rights.

Who is affected? Almost all businesses. From large corporations, SMEs, digital startups, to non-profit organizations. As long as you manage personal data of customers, employees, partners, or users, the PDP Law is relevant to your business.

In audit and inspection practice, the initial question from the regulator is usually simple: what personal data do you manage, for what purpose, and how do you protect it?

The PDP Law becomes the basis for assessing the answers to those questions, not only on paper, but in day-to-day operational processes.

What Does the PDP Law Cover?

The PDP Law regulates the entire end-to-end lifecycle of personal data, from the moment data is obtained until it is destroyed. Specifically, this includes several critical aspects that directly intersect with daily business operations.

1. Types of Personal Data

First, the PDP Law distinguishes types of personal data. There is general personal data (name, email, phone number) and specific data that is highly sensitive (health data, biometric data, political beliefs, financial records).

In a business context, this means companies must know which data carries higher risk.

Customer ID numbers, employee health data, or financial data clearly cannot be treated the same as a newsletter email address.

2. Rights of Data Subjects (Data Owners)

Second, the PDP Law regulates the rights of data subjects. These rights are often a weak point in many companies.

These rights are not an abstract concept. Rights can be directly translated as real requests from customers or employees. For example, the right to information, the right of access, the right to rectification, the right to erasure, to the right to withdraw consent.

In practice, when a customer or former employee requests data deletion, many businesses do not have clear systems and procedures to handle it.

3. Obligations of Data Controllers and Data Processors

Third, the PDP Law sets the obligations of data controllers and data processors.

As a data controller (the party that determines the purposes and means of data processing), you are required to have a legal basis (such as consent or contract), implement technical and organizational security measures, and report data breach incidents.

As a simple example, if you use a cloud vendor to store customer data, that vendor is a Data Processor.

The PDP Law requires a binding written agreement that regulates how the vendor protects your data.

What Does the Regulator Expect from Businesses?

The regulator doesn’t just want to see piles of policy documents. They want to see proof that your business manages personal data properly in a real and sustainable way.

During an audit later, what is sought is evidence of compliance, not just a statement of compliance. In inspections, regulators typically look for three main things.

First, whether the company has written policies related to personal data protection. Not generic policies downloaded from the internet, but policies that are relevant to existing business processes.

Also ensure there is a clear appointment of a Personal Data Protection Officer (PJ PDP), either an individual or a team, who understands their responsibilities.

Second, whether those processes are actually implemented. Is there a mechanism for data processing consent, access limitation, management of data subject rights, and incident handling?

Ask: how is the workflow for fulfilling data access requests from data subjects carried out? How is the data protection impact assessment (PIA/PDPIA) procedure for new products implemented?

Many companies have SOPs but cannot demonstrate how those SOPs are executed.

Third, evidence of implementation. System access logs, employee training records, data consent records, and documentation of vendor relationships.

This is where many businesses are surprised, because they have focused on operations, not on proving compliance.

As an example: A company has a great policy, but when system logs are checked, there is no strong authentication mechanism for HR to access employee data.

Or, the company claims customer consent has been obtained, but cannot show records (logs) of when and how consent was given by the customer.

The regulator will check the alignment between “what is on paper” and “what happens in the field.”

What Is the Impact of the PDP Law on Your Business?

The impact of UU PDP implementation on business can be seen from two sides: the risk if neglected, and the opportunity if compliant.

If You Proactively Comply (Opportunities):

• Increased Trust & Reputation: Commitment to privacy becomes a strong competitive advantage. Customers are more loyal to brands that respect their data.
• Better Data Governance: The data mapping process will open your eyes to “data clutter,” redundancy, and inefficient systems. This is a digital spring-cleaning process that will improve operational efficiency.
• Long-Term Risk Mitigation: With a strong foundation, you reduce exposure to risks of large fines, class action lawsuits, and operational disruption due to data incidents.

If You Ignore It (Risks):

• Sanction & Legal Risks: Administrative sanctions of up to 2% of annual revenue (and other specific sanctions amounting to billions of rupiah), criminal sanctions for individuals and corporations, and civil lawsuits from harmed data subjects.
• Severe Operational Disruption: Imagine if the regulator imposes data processing restrictions. Marketing, sales, and even customer service operations could be partially paralyzed.
• Fast & Massive Reputational Damage: News of a data breach can destroy years of trust in a matter of hours. Reputation recovery is far more expensive than prevention.

From a risk management perspective, the PDP Law forces you to view personal data as a liability that must be managed, not just an asset to be exploited.

Implementing Steps to Achieve PDP Law Compliance

Complying with the PDP Law is not complicated. You can start with realistic and high-impact steps. Compliance is a gradual process, not a project that can be completed at once.

1. Conduct Simple Personal Data Mapping

PDP Law compliance starts with data mapping and process improvement, not with thick documents.

Companies need to know what personal data they have, from whom, where it is stored, who uses or accesses it, and to whom it is shared.

You can create a simple spreadsheet to record this information. Without data mapping, compliance discussions will always be abstract.

2. Assign Responsibility & Build Awareness

Appoint who is the data controller, who executes the processes, and who is responsible if there are data subject requests or incidents.

Also conduct basic PDP Law awareness training for all employees, especially teams that handle data daily (HR, Marketing, IT, Customer Service).

In many organizations, unclear roles become a source of confusion when problems arise.

3. Review & Update the Privacy Policy

Ensure the privacy policy on your website/application is clear, transparent, and covers all elements required by the PDP Law. The privacy policy is your social contract with customers.

4. Create Basic Procedures for Handling Data Subject Rights

Prepare a form or special channel (dedicated email) to handle access, rectification, or data deletion requests. Define the internal workflow.

5. Implement Basic Access Controls

Ensure the principle of need-to-know basis is applied. Employees should only access data necessary for their job. Activate two-factor authentication (2FA) for critical systems.

6. Prepare a Data Breach Response Plan

Plan who should be contacted, initial investigation steps, and communication templates if an incident occurs. Don’t wait for a breach to happen to start thinking.

It is important to understand that PDP Law compliance is a gradual process. No company start at “100% compliant.”

What the regulator assesses is seriousness, direction of improvement, and the company’s ability to manage personal data risk sustainably.

Conclusion: Is Your Business Ready to Comply with the PDP Law?

The PDP Law is not a barrier to business innovation, but a framework for building sustainable and responsible digital businesses.

The PDP Law is the new business reality that forces companies to see personal data not just as operational input, but as both an asset and a source of risk.

Delaying compliance means delaying risk management. The longer it is postponed, the greater the potential impact when the company is asked to explain what it has been doing with personal data.

Utilize software like Adaptist Privee to help companies map personal data, document policies and controls, monitor PDP Law compliance, and prepare evidence needed during audits or regulator inspections.

The reflective question for management is no longer “are we compliant with the PDP Law,” but rather “if the regulator asks tomorrow, can we explain and prove how we manage personal data today?”

FAQ: PDP Law and Personal Data Protection Compliance