Navigating the US Privacy Patchwork: A Guide to DataProtection Impact Assessments (DPIAs) for Global Organizations

Executive Summary

For global organizations accustomed to the clear, unified mandate of the GDPR, the United States presents a complex and fragmented privacy landscape. There is no single federal data privacy law governing the commercial use of personal data. Instead, a growing "patchwork" of state-level laws is emerging, each with its own nuances, obligations, and enforcement risks.

A critical point of divergence is the requirement to conduct Data Protection Impact Assessments (DPIAs)—also known as Privacy Impact Assessments (PIAs) or, in California, Risk Assessments (RRAs). These assessments are a cornerstone of data governance, designed to identify and mitigate privacy risks before a new technology or processing activity is deployed.

This article, brought to you by Formiti Data International, serves as a comprehensive guide for global companies seeking to understand their DPIA obligations across the United States.

What is a Data Protection Impact Assessment (DPIA)?

A Data Protection Impact Assessment (DPIA) is a systematic process to evaluate the potential impact of a project, product, or processing activity on the privacy of individuals.

The core purpose of a DPIA is to:

  • Identify Risks: Proactively uncover potential privacy risks, suchmatches for discrimination, re-identification of anonymized data, or unauthorized access.
  • Mitigate Risks: Document and implement measures to reduce or eliminate those identified risks.
  • Demonstrate Accountability: Create a formal record that proves your organization has performed due diligence and complied with its legal obligations, which is crucial in the event of an investigation by a State Attorney General.

For organizations familiar with the EU's GDPR, the concept is the same. However, the triggers for requiring a DPIA in the US are more specific and vary from state to state.

The Core Challenge: Which US States Require DPIAs?

Unlike the GDPR, which requires a DPIA for any processing "likely to result in a high risk," US state laws are more prescriptive. As of this writing, several key states have comprehensive privacy laws that explicitly mandate these assessments.

The laws in Virginia (VCDPA), Colorado (CPA), Connecticut (CTDPA), Utah (UCPA), and others share a similar framework. They require a "data controller" (your organization) to conduct and document a DPIA for any processing activity that presents a heightened risk of harm.

A Special Case: California's Risk Assessments (RRAs)

California, with its California Privacy Rights Act (CPRA), takes a slightly different approach. The CPRA regulations mandate "Risk Assessments" (RRAs) for any processing of personal information that "presents a significant risk to consumers' privacy or security."

These RRAs must be submitted regularly to the California Privacy Protection Agency (CPPA) and are arguably broader in scope than the DPIAs required by other states.

When is a DPIA Required? Key High-Risk Triggers

While the exact wording varies, US state laws generally define "high-risk" activities that automatically trigger the need for a DPIA. If your organization engages in any of the following, a DPIA is almost certainly required in applicable states.

1. The Sale of Personal Data:

  • Any disclosure of personal data to a third party for monetary or "other valuable consideration." This definition is broad and can include many common ad-tech data-sharing arrangements.

2. Processing of "Sensitive Data":

  • This is a critical trigger. "Sensitive data" typically includes:
  • Racial or ethnic origin
  • Religious beliefs
  • Mental or physical health diagnoses
  • Sexual orientation
  • Citizenship or immigration status
  • Genetic or biometric data (for the purpose of unique identification)
  • Precise geolocation data
  • Personal data collected from a known child

3. Targeted Advertising:

This is defined as displaying advertisements to a consumer based on their personal data obtained from activities over time and across non-affiliated websites or applications. Standard contextual advertising (e.g., showing a running shoe ad on a running website) does not trigger this.

4. Profiling with Significant Effects:

Any form of automated processing to evaluate, analyze, or predict personal aspects of an individual that produces a "legal or similarly significant effect."

Examples: Automated decisions about an individual's eligibility for:

  • Credit or lending
  • Housing
  • Insurance
  • Employment
  • Access to essential goods or services

❓ Frequently Asked Questions (Q&A) for Global Organizations

Q: We already conduct GDPR DPIAs. Are those sufficient for US state laws?

A: Potentially, but not automatically. The good news is that US state laws were drafted after the GDPR. They explicitly state that a DPIA conducted for another law (like the GDPR) can be used to satisfy state requirements, but only if it has a "reasonably comparable" scope and effect.

Formiti's Expert Advice: Your existing GDPR DPIAs are a fantastic starting point. However, they must be reviewed and supplemented to address the specific triggers and definitions in US state laws (e.g., the broad definition of "sale" or the specific criteria for "targeted advertising"). A simple "find and replace" of "GDPR" with "VCDPA" is not compliant.

Q: What needs to be in a US-style DPIA?

A: The laws require the assessment to identify and weigh the benefits of the processing against the potential risks to individuals, factoring in the mitigation measures you plan to use.

A compliant DPIA should include:

  • A description of the processing activity, its purpose, and the categories of data involved.
  • The benefits of the processing for your company, the consumer, and the public.
  • The potential risks to consumers' rights (e.g., discrimination, financial harm, reputational damage).
  • The mitigation steps taken to reduce those risks (e.g., security controls, data minimization, use of de-identified data).
  • An analysis of whether the benefits outweigh the risks.

Q: Do we need to do a different DPIA for every state?

A: Not necessarily. You can conduct a single, comprehensive DPIA for a specific processing activity (like your new AI-powered marketing tool). This single assessment can be designed to address the requirements of all applicable state laws (California, Virginia, Colorado, etc.) simultaneously. This "map and gap" approach is far more efficient than creating separate documents for each state.

Q: What happens if we don't conduct a DPIA?

A: Failure to conduct a required DPIA is a direct violation of the law. State Attorneys General (AGs) are the primary enforcers. During an investigation (which could be triggered by a consumer complaint or a data breach), the AG will ask to see your DPIAs.

Not having one demonstrates a lack of due diligence and can lead to significant financial penalties (e.g., fines per violation), injunctions forcing you to stop the processing, and severe reputational damage.

Your Trusted Partner in US Privacy Compliance

The US data privacy landscape is complex and constantly shifting. For global organizations, maintaining compliance across this patchwork of state laws is a significant challenge that drains resources and creates uncertainty.

You don't have to navigate this alone.

Formiti Data International is a global leader in data privacy and governance. Our team of international privacy experts specializes in helping organizations unify their compliance programs. We bridge the gap between GDPR, CPRA, VCDPA, and other global frameworks, turning complex legal obligations into practical, business-enabling operations.

We provide:

  • Fractional Data Privacy Officers (DPOs): Get the C-suite expertise you need without the full-time overhead.
  • DPIA & RRA as-a-Service: We conduct and document robust, defensible assessments that satisfy all US state requirements.
  • US Privacy Program Audits: We identify your compliance gaps and provide a clear, prioritized roadmap for remediation.
  • Global Data Mapping & Governance: We help you understand what data you have, where it is, and how to protect it compliantly.

Don't let regulatory complexity slow your innovation.

Contact Formiti Data International today for a confidential consultation and discover how we can simplify your US data privacy compliance.