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CS Professional · Artificial Intelligence, Data Analytics and Cyber Security - Laws and Practice · Enterprise Resource Management

A retailer in Chennai moves its ERP to a SaaS provider whose servers are located outside India, and the ERP holds customers' personal data. Which statement best reflects the retailer's position?

The retailer stays accountable for the personal data because it collects the data and decides how it is used. It must put contractual and security safeguards in place with the SaaS vendor. Moving to the cloud or to offshore servers does not remove that responsibility.

  1. AThe retailer remains responsible for protecting the personal data as the data-collecting entity, so it must ensure contractual and security safeguards with the vendorCorrect
  2. BResponsibility passes wholly to the SaaS vendor once data is uploaded
  3. CResponsibility lapses because the servers are outside India
  4. DOnly the vendor's home country law applies, so the retailer has no obligations

Explanation

Outsourcing hosting does not shift the accountability of the entity that decides why and how personal data is processed. It must bind the vendor through contract and verify security safeguards. The other options wrongly assume that liability transfers or disappears with the cloud move or server location.

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