Avalara Data Processing and Transfer Addendum

Last updated September 27, 2021

This Avalara Data Processing and Transfer Addendum (“Addendum”) is incorporated into the Agreement between Avalara and Customer (the “Terms”). This Addendum describes the data protection requirements with respect to processing Customer Data in Customer’s use of the Services. If a provision of this Addendum conflicts with a provision of the Terms, the provision in this Addendum governs. Capitalized terms used and not otherwise defined in this Addendum have the meanings provided in the Terms.

  1. Except as amended by this Addendum, the Agreement will remain in full force and effect.
  2. To the extent that the terms of this Addendum and the Agreement conflict, the terms of this Addendum prevail. To the extent that the terms contained in this Addendum and the Agreement conflict, the terms of this Addendum govern.
  3. This Addendum will automatically expire on the termination or expiration of the Agreement.


Part 1. Data Processing Terms. This Part 1 governs Avalara’s processing of certain data as described herein.
 

STANDARD CONTRACTUAL CLAUSES
SECTION I

Clause 1

Purpose and scope

(a) The purpose of these Standard Contractual Clauses (the Clauses) is to ensure compliance with Article 28(3) and (4) of Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation). 

(b) The controllers and processors listed in Annex I have agreed to these Clauses in order to ensure compliance with Article 28(3) and (4) of Regulation (EU) 2016/679 and/or Article 29(3) and (4) of Regulation (EU) 2018/1725.

(c) These Clauses apply to the processing of personal data as specified in Annex II.

(d) Annexes I to IV are an integral part of the Clauses.

(e) These Clauses are without prejudice to obligations to which the controller is subject by virtue of Regulation (EU) 2016/679 and/or Regulation (EU) 2018/1725.

(f) These Clauses do not by themselves ensure compliance with obligations related to international transfers in accordance with Chapter V of Regulation (EU) 2016/679 and/or Regulation (EU) 2018/1725.

Clause 2

Invariability of the Clauses

(a) The Parties undertake not to modify the Clauses, except for adding information to the Annexes or updating information in them.

(b) This does not prevent the Parties from including the standard contractual clauses laid down in these Clauses in a broader contract, or from adding other clauses or additional safeguards provided that they do not directly or indirectly contradict the Clauses or detract from the fundamental rights or freedoms of data subjects.

Clause 3

Interpretation

(a) Where these Clauses use the terms defined in Regulation (EU) 2016/679 or Regulation (EU) 2018/1725 respectively, those terms shall have the same meaning as in that Regulation.

(b) These Clauses shall be read and interpreted in the light of the provisions of Regulation (EU) 2016/679 or Regulation (EU) 2018/1725 respectively.

(c) These Clauses shall not be interpreted in a way that runs counter to the rights and obligations provided for in Regulation (EU) 2016/679 / Regulation (EU) 2018/1725 or in a way that prejudices the fundamental rights or freedoms of the data subjects.

Clause 4

Hierarchy

In the event of a contradiction between these Clauses and the provisions of related agreements between the Parties existing at the time when these Clauses are agreed or entered into thereafter, these Clauses shall prevail.

Clause 5

Docking clause

(a) Any entity that is not a Party to these Clauses may, with the agreement of all the Parties, accede to these Clauses at any time as a controller or a processor by completing the Annexes and signing Annex I.

(b) Once the Annexes in (a) are completed and signed, the acceding entity shall be treated as a Party to these Clauses and have the rights and obligations of a controller or a processor, in accordance with its designation in Annex I

(c) The acceding entity shall have no rights or obligations resulting from these Clauses from the period prior to becoming a Party.


SECTION II

OBLIGATIONS OF THE PARTIES

 

Clause 6

Description of processing(s)

The details of the processing operations, in particular the categories of personal data and the purposes of processing for which the personal data is processed on behalf of the controller, are specified in Annex II.

Clause 7

Obligations of the Parties

7.1. Instructions

(a) The processor shall process personal data only on documented instructions from the controller, unless required to do so by Union or Member State law to which the processor is subject. In this case, the processor shall inform the controller of that legal requirement before processing, unless the law prohibits this on important grounds of public interest. Subsequent instructions may also be given by the controller throughout the duration of the processing of personal data. These instructions shall always be documented.

(b) The processor shall immediately inform the controller if, in the processor’s opinion, instructions given by the controller infringe Regulation (EU) 2016/679 / Regulation (EU) 2018/1725 or the applicable Union or Member State data protection provisions.

7.2. Purpose limitation

The processor shall process the personal data only for the specific purpose(s) of the processing, as set out in Annex II, unless it receives further instructions from the controller.

7.3. Duration of the processing of personal data

Processing by the processor shall only take place for the duration specified in Annex II.

7.4. Security of processing

(a) The processor shall at least implement the technical and organisational measures specified in Annex III to ensure the security of the personal data. This includes protecting the data against a breach of security leading to accidental or unlawful destruction, loss, alteration, unauthorised disclosure or access to the data (personal data breach). In assessing the appropriate level of security, the Parties shall take due account of the state of the art, the costs of implementation, the nature, scope, context and purposes of processing and the risks involved for the data subjects.

(b) The processor shall grant access to the personal data undergoing processing to members of its personnel only to the extent strictly necessary for implementing, managing and monitoring of the contract. The processor shall ensure that persons authorised to process the personal data received have committed themselves to confidentiality or are under an appropriate statutory obligation of confidentiality.

7.5. Sensitive data

If the processing involves personal data revealing racial or ethnic origin, political opinions, religious or philosophical beliefs, or trade union membership, genetic data or biometric data for the purpose of uniquely identifying a natural person, data concerning health or a person’s sex life or sexual orientation, or data relating to criminal convictions and offences (“sensitive data”), the processor shall apply specific restrictions and/or additional safeguards.

7.6. Documentation and compliance

(a) The Parties shall be able to demonstrate compliance with these Clauses.

(b) The processor shall deal promptly and adequately with inquiries from the controller about the processing of data in accordance with these Clauses.

(c) The processor shall make available to the controller all information necessary to demonstrate compliance with the obligations that are set out in these Clauses and stem directly from Regulation (EU) 2016/679 and/or Regulation (EU) 2018/1725. At the controller’s request, the processor shall also permit and contribute to audits of the processing activities covered by these Clauses, at reasonable intervals or if there are indications of non-compliance. In deciding on a review or an audit, the controller may take into account relevant certifications held by the processor.

(d) The controller may choose to conduct the audit by itself or mandate an independent auditor. Audits may also include inspections at the premises or physical facilities of the processor and shall, where appropriate, be carried out with reasonable notice.

(e) The Parties shall make the information referred to in this Clause, including the results of any audits, available to the competent supervisory authority/ies on request.

7.7. Use of sub-processors

(a) The processor has the controller’s general authorisation for the engagement of sub-processors from an agreed list. The processor shall specifically inform in writing the controller of any intended changes of that list through the addition or replacement of sub-processors at least 30 days in advance, thereby giving the controller sufficient time to be able to object to such changes prior to the engagement of the concerned sub-processor(s). The processor shall provide the controller with the information necessary to enable the controller to exercise the right to object.

(b) Where the processor engages a sub-processor for carrying out specific processing activities (on behalf of the controller), it shall do so by way of a contract which imposes on the sub-processor, in substance, the same data protection obligations as the ones imposed on the data processor in accordance with these Clauses. The processor shall ensure that the sub-processor complies with the obligations to which the processor is subject pursuant to these Clauses and to Regulation (EU) 2016/679 and/or Regulation (EU) 2018/1725.

(c) At the controller’s request, the processor shall provide a copy of such a sub-processor agreement and any subsequent amendments to the controller. To the extent necessary to protect business secret or other confidential information, including personal data, the processor may redact the text of the agreement prior to sharing the copy.

(d) The processor shall remain fully responsible to the controller for the performance of the sub-processor’s obligations in accordance with its contract with the processor. The processor shall notify the controller of any failure by the sub- processor to fulfil its contractual obligations.

(e) The processor shall agree a third party beneficiary clause with the sub-processor whereby - in the event the processor has factually disappeared, ceased to exist in law or has become insolvent - the controller shall have the right to terminate the sub-processor contract and to instruct the sub-processor to erase or return the personal data.

7.8. International transfers

(a) Any transfer of data to a third country or an international organisation by the processor shall be done only on the basis of documented instructions from the controller or in order to fulfil a specific requirement under Union or Member State law to which the processor is subject and shall take place in compliance with Chapter V of Regulation (EU) 2016/679 or Regulation (EU) 2018/1725.

(b) The controller agrees that where the processor engages a sub-processor in accordance with Clause 7.7. for carrying out specific processing activities (on behalf of the controller) and those processing activities involve a transfer of personal data within the meaning of Chapter V of Regulation (EU) 2016/679, the processor and the sub-processor can ensure compliance with Chapter V of Regulation (EU) 2016/679 by using standard contractual clauses adopted by the Commission in accordance with of Article 46(2) of Regulation (EU) 2016/679, provided the conditions for the use of those standard contractual clauses are met.

Clause 8

Assistance to the controller

(a) The processor shall promptly notify the controller of any request it has received from the data subject. It shall not respond to the request itself, unless authorised to do so by the controller.

(b) The processor shall assist the controller in fulfilling its obligations to respond to data subjects’ requests to exercise their rights, taking into account the nature of the processing. In fulfilling its obligations in accordance with (a) and (b), the processor shall comply with the controller’s instructions

(c) In addition to the processor’s obligation to assist the controller pursuant to Clause 8(b), the processor shall furthermore assist the controller in ensuring compliance with the following obligations, taking into account the nature of the data processing and the information available to the processor:

 

  1. the obligation to carry out an assessment of the impact of the envisaged processing operations on the protection of personal data (a ‘data protection impact assessment’) where a type of processing is likely to result in a high risk to the rights and freedoms of natural persons;
  2. the obligation to consult the competent supervisory authority/ies prior to processing where a data protection impact assessment indicates that the processing would result in a high risk in the absence of measures taken by the controller to mitigate the risk;
  3. the obligation to ensure that personal data is accurate and up to date, by informing the controller without delay if the processor becomes aware that the personal data it is processing is inaccurate or has become outdated;
  4. the obligations in Article 32 of Regulation (EU) 2016/679.

The Parties shall set out in Annex III the appropriate technical and organisational measures by which the processor is required to assist the controller in the application of this Clause as well as the scope and the extent of the assistance required.

Clause 9

Notification of personal data breach


In the event of a personal data breach, the processor shall cooperate with and assist the controller for the controller to comply with its obligations under Articles 33 and 34 of Regulation (EU) 2016/679 or under Articles 34 and 35 of Regulation (EU) 2018/1725, where applicable, taking into account the nature of processing and the information available to the processor.

9.1. Data breach concerning data processed by the controller

In the event of a personal data breach concerning data processed by the controller, the processor shall assist the controller:

(a) in notifying the personal data breach to the competent supervisory authority/ies, without undue delay after the controller has become aware of it, where relevant/(unless the personal data breach is unlikely to result in a risk to the rights and freedoms of natural persons);

(b) in obtaining the following information which, pursuant to Article 33(3) of Regulation (EU) 2016/679, shall be stated in the controller’s notification, and must at least include:

  1. the nature of the personal data including where possible, the categories and approximate number of data subjects concerned and the categories and approximate number of personal data records concerned;

  2. the likely consequences of the personal data breach;

  3. the measures taken or proposed to be taken by the controller to address the personal data breach, including, where appropriate, measures to mitigate its possible adverse effects.

Where, and insofar as, it is not possible to provide all this information at the same time, the initial notification shall contain the information then available and further information shall, as it becomes available, subsequently be provided without undue delay.
 
(c) in complying, pursuant to Article 34 of Regulation (EU) 2016/679, with the obligation to communicate without undue delay the personal data breach to the data subject, when the personal data breach is likely to result in a high risk to the rights and freedoms of natural persons.

 

9.2. Data breach concerning data processed by the processor

In the event of a personal data breach concerning data processed by the processor, the processor shall notify the controller without undue delay after the processor having become aware of the breach. Such notification shall contain, at least:

(a) a description of the nature of the breach (including, where possible, the categories and approximate number of data subjects and data records concerned);

(b) the details of a contact point where more information concerning the personal data breach can be obtained;

(c) its likely consequences and the measures taken or proposed to be taken to address the breach, including to mitigate its possible adverse effects.

Where, and insofar as, it is not possible to provide all this information at the same time, the initial notification shall contain the information then available and further information shall, as it becomes available, subsequently be provided without undue delay.

The Parties shall set out in Annex III all other elements to be provided by the processor when assisting the controller in the compliance with the controller’s obligations under Articles 33 and 34 of Regulation (EU) 2016/679.

 

SECTION III

FINAL PROVISIONS


Clause 10

Non-compliance with the Clauses and termination


(a) Without prejudice to any provisions of Regulation (EU) 2016/679 and/or Regulation (EU) 2018/1725, in the event that the processor is in breach of its obligations under these Clauses, the controller may instruct the processor to suspend the processing of personal data until the latter complies with these Clauses or the contract is terminated. The processor shall promptly inform the controller in case it is unable to comply with these Clauses, for whatever reason

(b) The controller shall be entitled to terminate the contract insofar as it concerns processing of personal data in accordance with these Clauses if

  1. the processing of personal data by the processor has been suspended by the controller pursuant to point (a) and if compliance with these Clauses is not restored within a reasonable time and in any event within one month following suspension;

  2. the processor is in substantial or persistent breach of these Clauses or its obligations under Regulation (EU) 2016/679 and/or Regulation (EU) 2018/1725;

  3. the processor fails to comply with a binding decision of a competent court or the competent supervisory authority/ies regarding its obligations pursuant to these Clauses or to Regulation (EU) 2016/679 and/or Regulation (EU) 2018/1725.

(c) The processor shall be entitled to terminate the contract insofar as it concerns processing of personal data under these Clauses where, after having informed the controller that its instructions infringe applicable legal requirements in accordance with Clause 7.1 (b), the controller insists on compliance with the instructions.

(d) Following termination of the contract, the processor shall, at the choice of the controller, delete all personal data processed on behalf of the controller and certify to the controller that it has done so, or, return all the personal data to the controller and delete existing copies unless Union or Member State law requires storage of the personal data. Until the data is deleted or returned, the processor shall continue to ensure compliance with these Clauses.

 

ANNEX I

List of parties


Controller(s):

1. Name: Customer

Address: Customer’s address on file with Avalara

Contact person’s name, position and contact details: Customer contact information on file with Avalara; Customer shall provide its data protection officer’s name if applicable 

Signature and accession date: The Parties deem the signature and accession date to be the date Customer executes the Sales Order.

Processor(s):

1. Name: Avalara

Address: See Avalara’s list of Affiliates here.

Contact person’s name, position and contact details: The Avalara Global Privacy Office, dataprivacy@avalara.com

Signature and accession date: The Parties deem the signature and accession date to be the date Customer executes the Sales Order.



ANNEX II

Description of the processing

 


ANNEX III

Technical and organisational measures including technical and organisational measures to ensure the security of the data

 

Avalara maintains the following technical and organizational measures:

  1. Avalara maintains a written security program under which Avalara periodically evaluates risks to Customer Data and maintains commercially reasonable technical, and physical safeguards to protect Customer Data against accidental or unauthorized access, disclosure, loss, destruction, or alteration. Avalara regularly evaluates the scope and coverage of the Security Program.

  2. Avalara teams classify and handle data using technical controls described below to ensure its integrity, availability, and confidentiality.

  3. Avalara maintains a central inventory of assets where the asset custodian is responsible for classifying and maintaining the asset and ensuring the use of the asset complies with the security program. 

  4. Avalara maintains standards for user authentication, access provisioning, de-provisioning, performing periodic access reviews and restricting administrative access to ensure access is granted based on the principle of least privilege.

  5. Avalara maintains standards for segregation of network services and devices to ensure unrelated portions of the network are isolated from each other.

  6. Avalara maintains network zones and applies ingress and egress standards for the protection of data. 

  7. Avalara systems encrypt data at rest and in transit between the Avalara networks and its customers to ensure integrity, security, and confidentiality of customer data.

  8. Avalara maintains processes to securely generate, store and manage encryption keys that prevent loss, theft, or compromise.

  9. Avalara maintains physical access controls to restrict entry to Avalara facilities. Physical controls may include badge readers, security personnel, staff supervision, video cameras, and other tools.

  10. Avalara maintains processes for retaining and securely deleting data no longer than necessary to provide its services.

  11. Direct database access is restricted using the corporate VPN. This can only be accessed via Avalara issued computing equipment.

  12. Avalara has disabled the ability to write data to USB mass storage devices on all Avalara issued computing equipment.

  13. Avalara maintains a Software Management Standard that defines software and services which are approved, acceptable, or prohibited to be used by Avalara personnel.

  14. Avalara monitors its applications and systems for vulnerabilities on a periodic basis. Identified vulnerabilities are remediated by taking actions to close them in a timely manner.

  15. Avalara maintains an incident response program to detect, analyze, prioritize, and handle cyber security events and incidents to prevent, detect, and deter the unauthorized access, loss, compromise, disclosure, modification, or destruction of Avalara’s electronic data assets and information, including personal information. 

  16. Avalara performs root cause analyses for incidents based on the nature of the incident, to identify, document, and eliminate the cause of an incident and to prevent the issue from recurring. Changes to the Avalara Incident Response Plan and standard operating procedures is also part of this review.

  17. Security and audit logs are fed to the SIEM daily and retained for a period of one year. These logs cannot be modified by anyone.

  18. Daily recoverable backups of critical data are configured to be performed and replicated to a secondary location.

  19. Avalara maintains a Security Infraction Management Policy that describes how Avalara treats security incidents that result from deviations from Avalara’s security policies, standards, and procedures.

  20. Avalara maintains standards for making changes to applications, including customer-facing applications, by ensuring they are tested and approved by appropriate individuals before they are moved to production. Access to make production changes is restricted to authorized individuals.

  21. Avalara has established logical separation between production and lower environments.

  22. Avalara ensures test data is selected and handled in accordance with the technical controls specified in this document.

  23. All Avalara personnel must undergo the mandatory security awareness training at least annually.

  24. The Avalara Service Terms and Conditions along with the Vendor Security terms document are in place to communicate security commitments with vendors.

  25. The Avalara Security team periodically performs assessments of different systems by conducting phishing simulations, vulnerability scans, and penetration tests.

  26. The Avalara Compliance team periodically performs assessments of key systems. Remediation plans are defined as appropriate for the areas of non-compliance establishing clear ownership and accountability. 

  27. The Avalara Risk Management Team periodically conducts risk assessments to identify risks arising from internal and external sources throughout the year to evaluate the organization's control environment. Risk treatment plans are defined, as appropriate, for identified risks including establishing clear ownership and accountability. Risks are monitored to acceptable mitigation according to the Avalara Security Risk Assessment Standard and Process. 

  28. Avalara maintains standards for Vendor Risk Management to define requirements for vendor selection, risk assessments with roles and responsibilities, contract lifecycle, exception handling and terminations.

 


ANNEX IV

List of sub-processors

EXPLANATORY NOTE:

 

This Annex needs to be completed in case of specific authorisation of sub-processors (Clause 7.7(a), Option 1). 

The controller has provided general authorisation for the engagement of subprocessors from an agreed list, available here.


Part 2. Controller to Processor Transfers.
This Part 2 governs controller to processor transfers out of the EEA.

 

STANDARD CONTRACTUAL CLAUSES
SECTION I

Clause 1

Purpose and scope

(a) The purpose of these standard contractual clauses is to ensure compliance with the requirements of Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (General Data Protection Regulation) for the transfer of personal data to a third country.

(b) The Parties:

  1. the natural or legal person(s), public authority/ies, agency/ies or other body/ies (hereinafter “entity/ies”) transferring the personal data, as listed in Annex I.A. (hereinafter each “data exporter”), and

  2. the entity/ies in a third country receiving the personal data from the data exporter, directly or indirectly via another entity also Party to these Clauses, as listed in Annex I.A. (hereinafter each “data importer”)

have agreed to these standard contractual clauses (hereinafter: “Clauses”).
 

(c) These Clauses apply with respect to the transfer of personal data as specified in Annex I.B

(d) The Appendix to these Clauses containing the Annexes referred to therein forms an integral part of these Clauses.

Clause 2

Effect and invariability of the Clauses

(a) These Clauses set out appropriate safeguards, including enforceable data subject

Where the data exporter is a processor subject to Regulation (EU) 2016/679 acting on behalf of a Union institution or body as controller, reliance on these Clauses when engaging another processor (sub-processing) not subject to Regulation (EU) 2016/679 also ensures compliance with Article 29(4) of Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295 of 21.11.2018, p. 39), to the extent these Clauses and the data protection obligations as set out in the contract or other legal act between the controller and the processor pursuant to Article 29(3) of Regulation (EU) 2018/1725 are aligned. This will in particular be the case where the controller and processor rely on the standard contractual clauses included in Decision rights and effective legal remedies, pursuant to Article 46(1) and Article 46 (2)(c) of Regulation (EU) 2016/679 and, with respect to data transfers from controllers to processors and/or processors to processors, standard contractual clauses pursuant to Article 28(7) of Regulation (EU) 2016/679, provided they are not modified, except to select the appropriate Module(s) or to add or update information in the Appendix. This does not prevent the Parties from including the standard contractual clauses laid down in these Clauses in a wider contract and/or to add other clauses or additional safeguards, provided that they do not contradict, directly or indirectly, these Clauses or prejudice the fundamental rights or freedoms of data subjects.

(b) These Clauses are without prejudice to obligations to which the data exporter is subject by virtue of Regulation (EU) 2016/679.

Clause 3

Third-party beneficiaries

(a) Data subjects may invoke and enforce these Clauses, as third-party beneficiaries, against the data exporter and/or data importer, with the following exceptions:

(i) Clause 1, Clause 2, Clause 3, Clause 6, Clause 7;
(ii) Clause 8.1(b) and Clause 8.9(a), (c), (d) and (e);
(iii) Clause 9(a), (c), (d) and (e);
(iv) Clause 12(a), (d) and (f);
(v) Clause 13;
(vi) Clause 15.1(c), (d) and (e);
(vii) Clause 16(e);
(viii) Clause 18(a) and (b).

(b) Paragraph (a) is without prejudice to rights of data subjects under Regulation (EU) 2016/679.

Clause 4
Interpretation

(a) Where these Clauses use terms that are defined in Regulation (EU) 2016/679, those terms shall have the same meaning as in that Regulation.

(b) These Clauses shall be read and interpreted in the light of the provisions of Regulation (EU) 2016/679.

(c) These Clauses shall not be interpreted in a way that conflicts with rights and obligations provided for in Regulation (EU) 2016/679.

Clause 5

Hierarchy

In the event of a contradiction between these Clauses and the provisions of related agreements between the Parties, existing at the time these Clauses are agreed or entered into thereafter, these Clauses shall prevail.

Clause 6

Description of the transfer(s)

The details of the transfer(s), and in particular the categories of personal data that are transferred and the purpose(s) for which they are transferred, are specified in Annex I.B.

Clause 7

Docking clause

(a) An entity that is not a Party to these Clauses may, with the agreement of the Parties, accede to these Clauses at any time, either as a data exporter or as a data importer, by completing the Appendix and signing Annex I.A.

(b) Once it has completed the Appendix and signed Annex I.A, the acceding entity shall become a Party to these Clauses and have the rights and obligations of a data exporter or data importer in accordance with its designation in Annex I.A.

(c) The acceding entity shall have no rights or obligations arising under these Clauses from the period prior to becoming a Party.

 

SECTION II – OBLIGATIONS OF THE PARTIES

Clause 8

Data protection safeguards

The data exporter warrants that it has used reasonable efforts to determine that the data importer is able, through the implementation of appropriate technical and organisational measures, to satisfy its obligations under these Clauses.

8.1 Instructions

(a) The data importer shall process the personal data only on documented instructions from the data exporter. The data exporter may give such instructions throughout the duration of the contract.

(b) The data importer shall immediately inform the data exporter if it is unable to follow those instructions.

8.3 Transparency

On request, the data exporter shall make a copy of these Clauses, including the Appendix as completed by the Parties, available to the data subject free of charge. To the extent necessary to protect business secrets or other confidential information, including the measures described in Annex II and personal data, the data exporter may redact part of the text of the Appendix to these Clauses prior to sharing a copy, but shall provide a meaningful summary where the data subject would otherwise not be able to understand the its content or exercise his/her rights. On request, the Parties shall provide the data subject with the reasons for the redactions, to the extent possible without revealing the redacted information. This Clause is without prejudice to the obligations of the data exporter under Articles 13 and 14 of Regulation (EU) 2016/679.

8.4 Accuracy

If the data importer becomes aware that the personal data it has received is inaccurate, or has become outdated, it shall inform the data exporter without undue delay. In this case, the data importer shall cooperate with the data exporter to erase or rectify the data.

8.5 Duration of processing and erasure or return of data

Processing by the data importer shall only take place for the duration specified in Annex I.B. After the end of the provision of the processing services, the data importer shall, at the choice of the data exporter, delete all personal data processed on behalf of the data exporter and certify to the data exporter that it has done so, or return to the data exporter all personal data processed on its behalf and delete existing copies. Until the data is deleted or returned, the data importer shall continue to ensure compliance with these Clauses. In case of local laws applicable to the data importer that prohibit return or deletion of the personal data, the data importer warrants that it will continue to ensure compliance with these Clauses and will only process it to the extent and for as long as required under that local law. This is without prejudice to Clause 14, in particular the requirement for the data importer under Clause 14(e) to notify the data exporter throughout the duration of the contract if it has reason to believe that it is or has become subject to laws or practices not in line with the requirements under Clause 14(a).

8.6 Security of processing

(a) The data importer and, during transmission, also the data exporter shall implement appropriate technical and organisational measures to ensure the security of the data, including protection against a breach of security leading to accidental or unlawful destruction, loss, alteration, unauthorised disclosure or access to that data (hereinafter “personal data breach”). In assessing the appropriate level of security, the Parties shall take due account of the state of the art, the costs of implementation, the nature, scope, context and purpose(s) of processing and the risks involved in the processing for the data subjects. The Parties shall in particular consider having recourse to encryption or pseudonymisation, including during transmission, where the purpose of processing can be fulfilled in that manner. In case of pseudonymisation, the additional information for attributing the personal data to a specific data subject shall, where possible, remain under the exclusive control of the data exporter. In complying with its obligations under this paragraph, the data importer shall at least implement the technical and organisational measures specified in Annex II. The data importer shall carry out regular checks to ensure that these measures continue to provide an appropriate level of security.

(b) The data importer shall grant access to the personal data to members of its personnel only to the extent strictly necessary for the implementation, management and monitoring of the contract. It shall ensure that persons authorised to process the personal data have committed themselves to confidentiality or are under an appropriate statutory obligation of confidentiality.

(c) In the event of a personal data breach concerning personal data processed by the data importer under these Clauses, the data importer shall take appropriate measures to address the breach, including measures to mitigate its adverse effects. The data importer shall also notify the data exporter without undue delay after having become aware of the breach. Such notification shall contain the details of a contact point where more information can be obtained, a description of the nature of the breach (including, where possible, categories and approximate number of data subjects and personal data records concerned), its likely consequences and the measures taken or proposed to address the breach including, where appropriate, measures to mitigate its possible adverse effects. Where, and in so far as, it is not possible to provide all information at the same time, the initial notification shall contain the information then available and further information shall, as it becomes available, subsequently be provided without undue delay.

(d) The data importer shall cooperate with and assist the data exporter to enable the data exporter to comply with its obligations under Regulation (EU) 2016/679, in particular to notify the competent supervisory authority and the affected data subjects, taking into account the nature of processing and the information available to the data importer.

8.7 Sensitive data

Where the transfer involves personal data revealing racial or ethnic origin, political opinions, religious or philosophical beliefs, or trade union membership, genetic data, or biometric data for the purpose of uniquely identifying a natural person, data concerning health or a person’s sex life or sexual orientation, or data relating to criminal convictions and offences (hereinafter “sensitive data”), the data importer shall apply the specific restrictions and/or additional safeguards described in Annex I.B.

8.8 Onward transfers

The data importer shall only disclose the personal data to a third party on documented instructions from the data exporter. In addition, the data may only be disclosed to a third party located outside the European Union (in the same country as the data importer or in another third country, hereinafter “onward transfer”) if the third party is or agrees to be bound by these Clauses, under the appropriate Module, or if:

(i) the onward transfer is to a country benefitting from an adequacy decision pursuant to Article 45 of Regulation (EU) 2016/679 that covers the onward transfer;

(ii) the third party otherwise ensures appropriate safeguards pursuant to Articles 46 or 47 Regulation of (EU) 2016/679 with respect to the processing in question;

(iii) the onward transfer is necessary for the establishment, exercise or defence of legal claims in the context of specific administrative, regulatory or judicial proceedings; or

(iv) the onward transfer is necessary in order to protect the vital interests of the data subject or of another natural person.

Any onward transfer is subject to compliance by the data importer with all the other safeguards under these Clauses, in particular purpose limitation.

8.9 Documentation and compliance

(a) The data importer shall promptly and adequately deal with enquiries from the data exporter that relate to the processing under these Clauses.

(b) The Parties shall be able to demonstrate compliance with these Clauses. In particular, the data importer shall keep appropriate documentation on the processing activities carried out on behalf of the data exporter.

(c) The data importer shall make available to the data exporter all information necessary to demonstrate compliance with the obligations set out in these Clauses and at the data exporter’s request, allow for and contribute to audits of the processing activities covered by these Clauses, at reasonable intervals or if there are indications of non- compliance. In deciding on a review or audit, the data exporter may take into account relevant certifications held by the data importer.

(d) The data exporter may choose to conduct the audit by itself or mandate an independent auditor. Audits may include inspections at the premises or physical facilities of the data importer and shall, where appropriate, be carried out with reasonable notice.

(e) The Parties shall make the information referred to in paragraphs (b) and (c), including the results of any audits, available to the competent supervisory authority on request.

The Agreement on the European Economic Area (EEA Agreement) provides for the extension of the European Union's internal market to the three EEA States Iceland, Liechtenstein and Norway. The Union data protection legislation, including Regulation (EU) 2016/679, is covered by the EEA Agreement and has been incorporated into Annex XI thereto. Therefore, any disclosure by the data importer to a third party located in the EEA does not qualify as an onward transfer for the purpose of these Clauses.

Clause 9

Use of sub-processors

(a) The data importer has the data exporter’s general authorisation for the engagement of sub-processor(s) from an agreed list. The data importer shall specifically inform the data exporter in writing of any intended changes to that list through the addition or replacement of sub-processors at least 30 days in advance, thereby giving the data exporter sufficient time to be able to object to such changes prior to the engagement of the sub-processor(s). The data importer shall provide the data exporter with the information necessary to enable the data exporter to exercise its right to object.

(b) Where the data importer engages a sub-processor to carry out specific processing activities (on behalf of the data exporter), it shall do so by way of a written contract that provides for, in substance, the same data protection obligations as those binding the data importer under these Clauses, including in terms of third-party beneficiary rights for data subjects. The Parties agree that, by complying with this Clause, the data importer fulfils its obligations under Clause 8.8. The data importer shall ensure that the sub-processor complies with the obligations to which the data importer is subject pursuant to these Clauses.

(c) The data importer shall provide, at the data exporter’s request, a copy of such a sub- processor agreement and any subsequent amendments to the data exporter. To the extent necessary to protect business secrets or other confidential information, including personal data, the data importer may redact the text of the agreement prior to sharing a copy.

(d) The data importer shall remain fully responsible to the data exporter for the performance of the sub-processor’s obligations under its contract with the data importer. The data importer shall notify the data exporter of any failure by the sub- processor to fulfil its obligations under that contract.

(e) The data importer shall agree a third-party beneficiary clause with the sub-processor whereby - in the event the data importer has factually disappeared, ceased to exist in law or has become insolvent - the data exporter shall have the right to terminate the sub-processor contract and to instruct the sub-processor to erase or return the personal data.

Clause 10

Data subject rights

(a) The data importer shall promptly notify the data exporter of any request it has received from a data subject. It shall not respond to that request itself unless it has been authorised to do so by the data exporter.

(b) The data importer shall assist the data exporter in fulfilling its obligations to respond to data subjects’ requests for the exercise of their rights under Regulation (EU) 2016/679. In this regard, the Parties shall set out in Annex II the appropriate technical and organisational measures, taking into account the nature of the processing, by which the assistance shall be provided, as well as the scope and the extent of the assistance required.

(c) In fulfilling its obligations under paragraphs (a) and (b), the data importer shall comply with the instructions from the data exporter.

Clause 11

Redress

(a) The data importer shall inform data subjects in a transparent and easily accessible format, through individual notice or on its website, of a contact point authorised to handle complaints. It shall deal promptly with any complaints it receives from a data subject.

(b) The data importer agrees that data subjects may also lodge a complaint with an independent dispute resolution body at no cost to the data subject. It shall inform the data subjects, in the manner set out in paragraph (a), of such redress mechanism and that they are not required to use it, or follow a particular sequence in seeking redress.

(c) In case of a dispute between a data subject and one of the Parties as regards compliance with these Clauses, that Party shall use its best efforts to resolve the issue amicably in a timely fashion. The Parties shall keep each other informed about such disputes and, where appropriate, cooperate in resolving them.

(d) Where the data subject invokes a third-party beneficiary right pursuant to Clause 3, the data importer shall accept the decision of the data subject to:

(i) lodge a complaint with the supervisory authority in the Member State of his/her habitual residence or place of work, or the competent supervisory authority pursuant to Clause 13

(ii) refer the dispute to the competent courts within the meaning of Clause 18.

(e) The Parties accept that the data subject may be represented by a not-for-profit body, organisation or association under the conditions set out in Article 80(1) of Regulation (EU) 2016/679.

(f) The data importer shall abide by a decision that is binding under the applicable EU or Member State law.

(g) The data importer agrees that the choice made by the data subject will not prejudice his/her substantive and procedural rights to seek remedies in accordance with applicable laws.

Clause 12

Liability

(a) Each Party shall be liable to the other Party/ies for any damages it causes the other Party/ies by any breach of these Clauses.

(b) The data importer shall be liable to the data subject, and the data subject shall be entitled to receive compensation, for any material or non-material damages the data importer or its sub-processor causes the data subject by breaching the third-party beneficiary rights under these Clauses.

(c) Notwithstanding paragraph (b), the data exporter shall be liable to the data subject, and the data subject shall be entitled to receive compensation, for any material or non-material damages the data exporter or the data importer (or its sub-processor) causes the data subject by breaching the third-party beneficiary rights under these Clauses. This is without prejudice to the liability of the data exporter and, where the data exporter is a processor acting on behalf of a controller, to the liability of the controller under Regulation (EU) 2016/679 or Regulation (EU) 2018/1725, as applicable.

(d) The Parties agree that if the data exporter is held liable under paragraph (c) for damages caused by the data importer (or its sub-processor), it shall be entitled to claim back from the data importer that part of the compensation corresponding to the data importer’s responsibility for the damage.

(e) Where more than one Party is responsible for any damage caused to the data subject as a result of a breach of these Clauses, all responsible Parties shall be jointly and severally liable and the data subject is entitled to bring an action in court against any of these Parties.

(f) The Parties agree that if one Party is held liable under paragraph (e), it shall be entitled to claim back from the other Party/ies that part of the compensation corresponding to its / their responsibility for the damage.

(g) The data importer may not invoke the conduct of a sub-processor to avoid its own liability.

Clause 13

Supervision

(a) The supervisory authority with responsibility for ensuring compliance by the data exporter with Regulation (EU) 2016/679 as regards the data transfer, as indicated in Annex I.C, shall act as competent supervisory authority.

(b) The data importer agrees to submit itself to the jurisdiction of and cooperate with the competent supervisory authority in any procedures aimed at ensuring compliance with these Clauses. In particular, the data importer agrees to respond to enquiries, submit to audits and comply with the measures adopted by the supervisory authority, including remedial and compensatory measures. It shall provide the supervisory authority with written confirmation that the necessary actions have been taken.

 

 

SECTION III – LOCAL LAWS AND OBLIGATIONS IN CASE OF ACCESS BY PUBLIC AUTHORITIES


Clause 14

Local laws and practices affecting compliance with the Clauses

(a) The Parties warrant that they have no reason to believe that the laws and practices in the third country of destination applicable to the processing of the personal data by the data importer, including any requirements to disclose personal data or measures authorising access by public authorities, prevent the data importer from fulfilling its obligations under these Clauses. This is based on the understanding that laws and practices that respect the essence of the fundamental rights and freedoms and do not exceed what is necessary and proportionate in a democratic society to safeguard one of the objectives listed in Article 23(1) of Regulation (EU) 2016/679, are not in contradiction with these Clauses.

(b) The Parties declare that in providing the warranty in paragraph (a), they have taken due account in particular of the following elements:

(i) the specific circumstances of the transfer, including the length of the processing chain, the number of actors involved and the transmission channels used; intended onward transfers; the type of recipient; the purpose of processing; the categories and format of the transferred personal data; the economic sector in which the transfer occurs; the storage location of the data transferred;

(ii) the laws and practices of the third country of destination– including those requiring the disclosure of data to public authorities or authorising access by such authorities – relevant in light of the specific circumstances of the transfer, and the applicable limitations and safeguards; 

(iii) any relevant contractual, technical or organisational safeguards put in place to supplement the safeguards under these Clauses, including measures applied during transmission and to the processing of the personal data in the country of destination.

(c) The data importer warrants that, in carrying out the assessment under paragraph (b), it has made its best efforts to provide the data exporter with relevant information and agrees that it will continue to cooperate with the data exporter in ensuring compliance with these Clauses.

(d) The Parties agree to document the assessment under paragraph (b) and make it available to the competent supervisory authority on request.

(e) The data importer agrees to notify the data exporter promptly if, after having agreed to these Clauses and for the duration of the contract, it has reason to believe that it is or has become subject to laws or practices not in line with the requirements under paragraph (a), including following a change in the laws of the third country or a measure (such as a disclosure request) indicating an application of such laws in practice that is not in line with the requirements in paragraph (a).

(f) Following a notification pursuant to paragraph (e), or if the data exporter otherwise has reason to believe that the data importer can no longer fulfil its obligations under these Clauses, the data exporter shall promptly identify appropriate measures (e.g. technical or organisational measures to ensure security and confidentiality) to be adopted by the data exporter and/or data importer to address the situation. The data exporter shall suspend the data transfer if it considers that no appropriate safeguards for such transfer can be ensured, or if instructed by the competent supervisory authority to do so. In this case, the data exporter shall be entitled to terminate the contract, insofar as it concerns the processing of personal data under these Clauses. If the contract involves more than two Parties, the data exporter may exercise this right to termination only with respect to the relevant Party, unless the Parties have agreed otherwise. Where the contract is terminated pursuant to this Clause, Clause 16(d) and (e) shall apply.

Clause 15

Obligations of the data importer in case of access by public authorities

15.1 Notification

(a) The data importer agrees to notify the data exporter and, where possible, the data subject promptly (if necessary with the help of the data exporter) if it:

(i) receives a legally binding request from a public authority, including judicial authorities, under the laws of the country of destination for the disclosure of personal data transferred pursuant to these Clauses; such notification shall include information about the personal data requested, the requesting authority, the legal basis for the request and the response provided; or

(ii) becomes aware of any direct access by public authorities to personal data transferred pursuant to these Clauses in accordance with the laws of the country of destination; such notification shall include all information available to the importer.

(b) If the data importer is prohibited from notifying the data exporter and/or the data subject under the laws of the country of destination, the data importer agrees to use its best efforts to obtain a waiver of the prohibition, with a view to communicating as much information as possible, as soon as possible. The data importer agrees to document its best efforts in order to be able to demonstrate them on request of the data exporter.

(c) Where permissible under the laws of the country of destination, the data importer agrees to provide the data exporter, at regular intervals for the duration of the contract, with as much relevant information as possible on the requests received (in particular, number of requests, type of data requested, requesting authority/ies, whether requests have been challenged and the outcome of such challenges, etc.).

(d) The data importer agrees to preserve the information pursuant to paragraphs (a) to (c) for the duration of the contract and make it available to the competent supervisory authority on request.

(e) Paragraphs (a) to (c) are without prejudice to the obligation of the data importer pursuant to Clause 14(e) and Clause 16 to inform the data exporter promptly where it is unable to comply with these Clauses.

15.2 Review of legality and data minimization

(a) The data importer agrees to review the legality of the request for disclosure, in particular whether it remains within the powers granted to the requesting public authority, and to challenge the request if, after careful assessment, it concludes that there are reasonable grounds to consider that the request is unlawful under the laws of the country of destination, applicable obligations under international law and principles of international comity. The data importer shall, under the same conditions, pursue possibilities of appeal. When challenging a request, the data importer shall seek interim measures with a view to suspending the effects of the request until the competent judicial authority has decided on its merits. It shall not disclose the personal data requested until required to do so under the applicable procedural rules. These requirements are without prejudice to the obligations of the data importer under Clause 14(e).

(b) The data importer agrees to document its legal assessment and any challenge to the request for disclosure and, to the extent permissible under the laws of the country of destination, make the documentation available to the data exporter. It shall also make it available to the competent supervisory authority on request.

(c) The data importer agrees to provide the minimum amount of information permissible when responding to a request for disclosure, based on a reasonable interpretation of the request.

 

SECTION IV – FINAL PROVISIONS


Clause 16

Non-compliance with the Clauses and termination

(a) The data importer shall promptly inform the data exporter if it is unable to comply with these Clauses, for whatever reason.

(b) In the event that the data importer is in breach of these Clauses or unable to comply with these Clauses, the data exporter shall suspend the transfer of personal data to the data importer until compliance is again ensured or the contract is terminated. This is without prejudice to Clause 14(f).

(c) The data exporter shall be entitled to terminate the contract, insofar as it concerns the processing of personal data under these Clauses, where:

(i) the data exporter has suspended the transfer of personal data to the data importer pursuant to paragraph (b) and compliance with these Clauses is not restored within a reasonable time and in any event within one month of suspension;

(ii) the data importer is in substantial or persistent breach of these Clauses; or

(iii) the data importer fails to comply with a binding decision of a competent court or supervisory authority regarding its obligations under these Clauses.

In these cases, it shall inform the competent supervisory authority of such non-compliance. Where the contract involves more than two Parties, the data exporter may exercise this right to termination only with respect to the relevant Party, unless the Parties have agreed otherwise.

(d) Personal data that has been transferred prior to the termination of the contract pursuant to paragraph (c) shall at the choice of the data exporter immediately be returned to the data exporter or deleted in its entirety. The same shall apply to any copies of the data. The data importer shall certify the deletion of the data to the data exporter. Until the data is deleted or returned, the data importer shall continue to ensure compliance with these Clauses. In case of local laws applicable to the data importer that prohibit the return or deletion of the transferred personal data, the data importer warrants that it will continue to ensure compliance with these Clauses and will only process the data to the extent and for as long as required under that local law.

(e) Either Party may revoke its agreement to be bound by these Clauses where (i) the European Commission adopts a decision pursuant to Article 45(3) of Regulation (EU) 2016/679 that covers the transfer of personal data to which these Clauses apply; or (ii) Regulation (EU) 2016/679 becomes part of the legal framework of the country to which the personal data is transferred. This is without prejudice to other obligations applying to the processing in question under Regulation (EU) 2016/679.

Clause 17

Governing law

These Clauses shall be governed by the law of one of the EU Member States, provided such law allows for third-party beneficiary rights. The Parties agree that this shall be the law of Luxembourg.

Clause 18

Choice of forum and jurisdiction

(a) Any dispute arising from these Clauses shall be resolved by the courts of an EU Member State.

(b) The Parties agree that those shall be the courts of Luxembourg.

(c) A data subject may also bring legal proceedings against the data exporter and/or data importer before the courts of the Member State in which he/she has his/her habitual residence.

(d) The Parties agree to submit themselves to the jurisdiction of such courts.

 

 

APPENDIX

ANNEX I


A. LIST OF PARTIES


Data exporter(s): 

1. Name: Customer

Address: Customer’s address on file with Avalara

Contact person’s name, position and contact details: Customer contact information on file with Avalara; Customer shall provide its data protection officer’s name if applicable 

Activities relevant to the data transferred under these Clauses: Providing the Services to Customer

Signature and accession date: The Parties deem the signature and accession date to be the date Customer executes the Sales Order. 

Role (controller/processor): Controller

Data importer(s): 

1. Name: Avalara, Inc.

Address:  255 South King Street, Suite 1800, Seattle, WA 98104

Contact person’s name, position and contact details: The Avalara Global Privacy office, dataprivacy@avalara.com 

Activities relevant to the data transferred under these Clauses:  Providing the Services to Customer

Signature and date: The Parties deem the signature and accession date to be the date Customer executes the Sales Order.

Role (controller/processor):  Processor

B. DESCRIPTION OF TRANSFER

 

B. COMPETENT SUPERVISORY AUTHORITY

Luxembourg

ANNEX II

TECHNICAL AND ORGANISATIONAL MEASURES INCLUDING TECHNICAL AND ORGANISATIONAL MEASURES TO ENSURE THE SECURITY OF THE DATA


Avalara maintains the following technical and organization measures:

  1. Avalara maintains a written security program under which Avalara periodically evaluates risks to Customer Data and maintains commercially reasonable technical, and physical safeguards to protect Customer Data against accidental or unauthorized access, disclosure, loss, destruction, or alteration. Avalara regularly evaluates the scope and coverage of the Security Program.

  2. Avalara teams classify and handle data using technical controls described below to ensure its integrity, availability, and confidentiality.

  3. Avalara maintains a central inventory of assets where the asset custodian is responsible for classifying and maintaining the asset and ensuring the use of the asset complies with the security program. 

  4. Avalara maintains standards for user authentication, access provisioning, de-provisioning, performing periodic access reviews and restricting administrative access to ensure access is granted based on the principle of least privilege.

  5. Avalara maintains standards for segregation of network services and devices to ensure unrelated portions of the network are isolated from each other.

  6. Avalara maintains network zones and applies ingress and egress standards for the protection of data. 

  7. Avalara systems encrypt data at rest and in transit between the Avalara networks and its customers to ensure integrity, security, and confidentiality of customer data.

  8. Avalara maintains processes to securely generate, store and manage encryption keys that prevent loss, theft, or compromise.

  9. Avalara maintains physical access controls to restrict entry to Avalara facilities. Physical controls may include badge readers, security personnel, staff supervision, video cameras, and other tools.

  10. Avalara maintains processes for retaining and securely deleting data no longer than necessary to provide its services.

  11. Direct database access is restricted using the corporate VPN. This can only be accessed via Avalara issued computing equipment.

  12. Avalara has disabled the ability to write data to USB mass storage devices on all Avalara issued computing equipment.

  13. Avalara maintains a Software Management Standard that defines software and services which are approved, acceptable, or prohibited to be used by Avalara personnel.

  14. Avalara monitors its applications and systems for vulnerabilities on a periodic basis. Identified vulnerabilities are remediated by taking actions to close them in a timely manner.

  15. Avalara maintains an incident response program to detect, analyze, prioritize, and handle cyber security events and incidents to prevent, detect, and deter the unauthorized access, loss, compromise, disclosure, modification, or destruction of Avalara’s electronic data assets and information, including personal information. 

  16. Avalara performs root cause analyses for incidents based on the nature of the incident, to identify, document, and eliminate the cause of an incident and to prevent the issue from recurring. Changes to the Avalara Incident Response Plan and standard operating procedures is also part of this review.

  17. Security and Aaudit logs are fed to the SIEM daily and retained for a period of one year. These logs cannot be modified by anyone.

  18. Daily recoverable backups of critical data are configured to be performed and replicated to a secondary location.

  19. Avalara maintains a Security Infraction Management Policy that describes how Avalara treats security incidents that result from deviations from Avalara’s security policies, standards, and procedures.

  20. Avalara maintains standards for making changes to applications, including customer-facing applications, by ensuring they are tested and approved by appropriate individuals before they are moved to production. Access to make production changes is restricted to authorized individuals.

  21. Avalara has established logical separation between production and lower environments.

  22. Avalara ensures test data is selected and handled in accordance with the technical controls specified in this document.

  23. All Avalara personnel must undergo the mandatory security awareness training at least annually.

  24. The Avalara Service Terms and Conditions along with the Vendor Security terms document are in place to communicate security commitments with vendors.

  25. The Avalara Security team periodically performs assessments of different systems by conducting phishing simulations, vulnerability scans, and penetration tests.

  26. The Avalara Compliance team periodically performs assessments of key systems. Remediation plans are defined as appropriate for the areas of non-compliance establishing clear ownership and accountability. 

  27. The Avalara Risk Management Team periodically conducts risk assessments to identify risks arising from internal and external sources throughout the year to evaluate the organization's control environment. Risk treatment plans are defined, as appropriate, for identified risks including establishing clear ownership and accountability. Risks are monitored to acceptable mitigation according to the Avalara Security Risk Assessment Standard and Process. 

  28. Avalara maintains standards for Vendor Risk Management to define requirements for vendor selection, risk assessments with roles and responsibilities, contract lifecycle, exception handling and terminations.


ANNEX III
 
LIST OF SUB-PROCESSORS
 

EXPLANATORY NOTE:
 

This Annex must be completed in case of the specific authorisation of sub-processors (Clause 9(a), Option 1). 

The controller has provided general authorisation for the engagement of subprocessors from an agreed list, available here.

Part 3. Ex-U.K. Restricted Transfers and Existing Customers.


1.   This Part 5 applies to restricted transfers out of the United Kingdom. On the date that Avalara notifies Customer in writing that it has adopted an alternative recognized compliance standard for the lawful transfer of personal data (as defined in Regulation (EU) 2016/679 of the European Parliament and of the Council) outside of the U.K., such alternative standard shall replace the terms of Schedule 1 in its entirety.

2.   For purposes of this Part 3, the Parties understand and intend the references to the “law of the Member State where the data exporter is established” to mean the law of the Member State where Customer’s corporate headquarters are located in the EEA or the U.K., as applicable, and the references to the “Member State where the data exporter is established” to mean the Member State where Customer’s corporate headquarters are located in the EEA or the U.K., as applicable.

3.   Except as amended by this Part 3, the Terms will remain in full force and effect, including, for the avoidance of doubt, the financial limits on liability found therein.

4.   To the extent that the terms of this Part 3 and the Terms conflict, the terms of this Part 3 will prevail. To the extent that the terms of Schedule 1 hereto and other terms contained herein conflict, the terms of Schedule 1 shall prevail.

5.   This Part 3 will automatically expire on the termination or expiry of the Terms.

6.   This Part 3 applies to all existing Customers as of September 27, 2021. This Part 3 will expire with respect to those Customers and Part 2  will replace this Part 3, as applicable, on December 27, 2022.

7.  Additional Safeguards Clauses.

a. No Variation. These Additional Safeguards Clauses supplement, but do not vary or modify, the Standard Contractual Clauses (processors) set forth below in Schedule 1.


b.   Challenges. To the greatest extent permissible under law applicable to data importer, data importer shall:

(i) inform the data exporter about requests, orders or similar demands by a court, competent authority, law enforcement or other government body ("Law Enforcement Request") relating to the processing of personal data under these Clauses.

(ii) object to and challenge any Law Enforcement Request by taking legally available steps to not be compelled to disclose any personal data processed under these Clauses.

(iii) minimize any compelled transfer of personal data in response to a Law Enforcement Request to that specified in the applicable legal order.

For purposes of this section, data importer would not be required to take actions that would result in civil or criminal penalty.

c.   Certification. Data importer certifies that it has not purposefully created back doors or similar programming that could be used to access personal data processed under these Clauses on its systems, or purposefully created or changed its business processes in a manner that facilitates access to personal data processed under these Clauses on its systems by government authorities.

d.   Transparency Review and Transfer Risk Assessment. In case data importer makes personal data processed under these Clauses available to sub-processors, data importer will select sub-processors in a country outside of the European Economic Area that is not subject of an adequacy finding by the European Union Commission only after a due diligence that entails (i) a review of any transparency reports made available by sub-processor, (ii) and carrying out and documenting a transfer risk assessment prior to the engagement of sub-processor.

 

Schedule 1

Standard Contractual Clauses (processors)

For the purposes of Article 26(2) of Directive 95/46/EC for the transfer of personal data to processors established in third countries which do not ensure an adequate level of data protection

Customer (the “data exporter”)
and
Avalara, Inc., and its Affiliates (the “data importer”) 

 

each a “party”; together “the parties”, HAVE AGREED on the following Contractual Clauses (the “Clauses” or “Standard Contractual Clauses”) in order to adduce adequate safeguards with respect to the protection of privacy and fundamental rights and freedoms of individuals for the transfer by the data exporter to the data importer of the personal data specified in Appendix 1. 

Clause 1

Definitions

a.  'personal data', 'special categories of data', 'process/processing', 'controller', 'processor', 'data subject' and 'supervisory authority' shall have the same meaning as in Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data;

b.  'the data exporter' means the controller who transfers the personal data;

c.  'the data importer' means the processor who agrees to receive from the data exporter personal data intended for processing on his behalf after the transfer in accordance with his instructions and the terms of the Clauses and who is not subject to a third country's system ensuring adequate protection within the meaning of Article 25(1) of Directive 95/46/EC;

d.  'the subprocessor' means any processor engaged by the data importer or by any other subprocessor of the data importer who agrees to receive from the data importer or from any other subprocessor of the data importer personal data exclusively intended for processing activities to be carried out on behalf of the data exporter after the transfer in accordance with his instructions, the terms of the Clauses and the terms of the written subcontract;

e.  'the applicable data protection law' means the legislation protecting the fundamental rights and freedoms of individuals and, in particular, their right to privacy with respect to the processing of personal data applicable to a data controller in the Member State where the data exporter is established;

f.  'technical and organisational security measures' means those measures aimed at protecting personal data against accidental or unlawful destruction or accidental loss, alteration, unauthorised disclosure or access, in particular where the processing involves the transmission of data over a network, and against all other unlawful forms of processing.  

Clause 2

Details of the transfer

The details of the transfer and in particular the special categories of personal data where applicable are specified in Appendix 1 which forms an integral part of the Clauses.

  1. The data subject can enforce against the data exporter this Clause, Clause 4(b) to (i), Clause 5(a) to (e), and (g) to (j), Clause 6(1) and (2), Clause 7, Clause 8(2), and Clauses 9 to 12 as third-party beneficiary.
  2. The data subject can enforce against the data importer this Clause, Clause 5(a) to (e) and (g), Clause 6, Clause 7, Clause 8(2), and Clauses 9 to 12, in cases where the data exporter has factually disappeared or has ceased to exist in law unless any successor entity has assumed the entire legal obligations of the data exporter by contract or by operation of law, as a result of which it takes on the rights and obligations of the data exporter, in which case the data subject can enforce them against such entity.
  3. The data subject can enforce against the subprocessor this Clause, Clause 5(a) to (e) and (g), Clause 6, Clause 7, Clause 8(2), and Clauses 9 to 12, in cases where both the data exporter and the data importer have factually disappeared or ceased to exist in law or have become insolvent, unless any successor entity has assumed the entire legal obligations of the data exporter by contract or by operation of law as a result of which it takes on the rights and obligations of the data exporter, in which case the data subject can enforce them against such entity. Such third-party liability of the subprocessor shall be limited to its own processing operations under the Clauses.
  4. The parties do not object to a data subject being represented by an association or other body if the data subject so expressly wishes and if permitted by national law.

Clause 4

Obligations of the data exporter

The data exporter agrees and warrants:

a.  that the processing, including the transfer itself, of the personal data has been and will continue to be carried out in accordance with the relevant provisions of the applicable data protection law (and, where applicable, has been notified to the relevant authorities of the Member State where the data exporter is established) and does not violate the relevant provisions of that State;

b.  that it has instructed and throughout the duration of the personal data processing services will instruct the data importer to process the personal data transferred only on the data exporter's behalf and in accordance with the applicable data protection law and the Clauses;

c.  that the data importer will provide sufficient guarantees in respect of the technical and organisational security measures specified in Appendix 2 below;

d.  that after assessment of the requirements of the applicable data protection law, the security measures are appropriate to protect personal data against accidental or unlawful destruction or accidental loss, alteration, unauthorised disclosure or access, in particular where the processing involves the transmission of data over a network, and against all other unlawful forms of processing, and that these measures ensure a level of security appropriate to the risks presented by the processing and the nature of the data to be protected having regard to the state of the art and the cost of their implementation;  

e.  that it will ensure compliance with the security measures;

f.  that, if the transfer involves special categories of data, the data subject has been informed or will be informed before, or as soon as possible after, the transfer that its data could be transmitted to a third country not providing adequate protection within the meaning of Directive 95/46/EC;

g.  to forward any notification received from the data importer or any subprocessor pursuant to Clause 5(b) and Clause 8(3) to the data protection supervisory authority if the data exporter decides to continue the transfer or to lift the suspension;

h.  to make available to the data subjects upon request a copy of the Clauses, with the exception of Appendix 2, and a summary description of the security measures, as well as a copy of any contract for subprocessing services which has to be made in accordance with the Clauses, unless the Clauses or the contract contain commercial information, in which case it may remove such commercial information;

i.  that, in the event of subprocessing, the processing activity is carried out in accordance with Clause 11 by a subprocessor providing at least the same level of protection for the personal data and the rights of data subject as the data importer under the Clauses; and

j.  that it will ensure compliance with Clause 4(a) to (i).

Clause 5

Obligations of the data importer

The data importer agrees and warrants:

a.  to process the personal data only on behalf of the data exporter and in compliance with its instructions and the Clauses; if it cannot provide such compliance for whatever reasons, it agrees to inform promptly the data exporter of its inability to comply, in which case the data exporter is entitled to suspend the transfer of data and/or terminate the contract;

b.  that it has no reason to believe that the legislation applicable to it prevents it from fulfilling the instructions received from the data exporter and its obligations under the contract and that in the event of a change in this legislation which is likely to have a substantial adverse effect on the warranties and obligations provided by the Clauses, it will promptly notify the change to the data exporter as soon as it is aware, in which case the data exporter is entitled to suspend the transfer of data and/or terminate the contract;

c.  that it has implemented the technical and organisational security measures specified in Appendix 2 before processing the personal data transferred;

d.  that it will promptly notify the data exporter about:

(i) any legally binding request for disclosure of the personal data by a law enforcement authority unless otherwise prohibited, such as a prohibition under criminal law to preserve the confidentiality of a law enforcement investigation,

(ii) any accidental or unauthorised access, and

(iii) any request received directly from the data subjects without responding to that request, unless it has been otherwise authorised to do so;

e.  to deal promptly and properly with all inquiries from the data exporter relating to its processing of the personal data subject to the transfer and to abide by the advice of the supervisory authority with regard to the processing of the data transferred;

f.  at the request of the data exporter to submit its data processing facilities for audit of the processing activities covered by the Clauses which shall be carried out by the data exporter or an inspection body composed of independent members and in possession of the required professional qualifications bound by a duty of confidentiality, selected by the data exporter, where applicable, in agreement with the supervisory authority;

g.  to make available to the data subject upon request a copy of the Clauses, or any existing contract for subprocessing, unless the Clauses or contract contain commercial information, in which case it may remove such commercial information, with the exception of Appendix 2 which shall be replaced by a summary description of the security measures in those cases where the data subject is unable to obtain a copy from the data exporter;

h.  that, in the event of subprocessing, it has previously informed the data exporter and obtained its prior written consent;

i.  that the processing services by the subprocessor will be carried out in accordance with Clause 11;

j.  to send promptly a copy of any subprocessor agreement it concludes under the Clauses to the data exporter.

Clause 6

Liability
  1. The parties agree that any data subject, who has suffered damage as a result of any breach of the obligations referred to in Clause 3 or in Clause 11 by any party or subprocessor is entitled to receive compensation from the data exporter for the damage suffered.

  2. If a data subject is not able to bring a claim for compensation in accordance with paragraph 1 against the data exporter, arising out of a breach by the data importer or his subprocessor of any of their obligations referred to in Clause 3 or in Clause 11, because the data exporter has factually disappeared or ceased to exist in law or has become insolvent, the data importer agrees that the data subject may issue a claim against the data importer as if it were the data exporter, unless any successor entity has assumed the entire legal obligations of the data exporter by contract of by operation of law, in which case the data subject can enforce its rights against such entity. The data importer may not rely on a breach by a subprocessor of its obligations in order to avoid its own liabilities.

  3. If a data subject is not able to bring a claim against the data exporter or the data importer referred to in paragraphs 1 and 2, arising out of a breach by the subprocessor of any of their obligations referred to in Clause 3 or in Clause 11 because both the data exporter and the data importer have factually disappeared or ceased to exist in law or have become insolvent, the subprocessor agrees that the data subject may issue a claim against the data subprocessor with regard to its own processing operations under the Clauses as if it were the data exporter or the data importer, unless any successor entity has assumed the entire legal obligations of the data exporter or data importer by contract or by operation of law, in which case the data subject can enforce its rights against such entity. The liability of the subprocessor shall be limited to its own processing operations under the Clauses.

Clause 7

Mediation and jurisdiction
 

The data importer agrees that if the data subject invokes against it third-party beneficiary rights and/or claims compensation for damages under the Clauses, the data importer will accept the decision of the data subject:

(i) to refer the dispute to mediation, by an independent person or, where applicable, by the supervisory authority;

(ii) to refer the dispute to the courts in the Member State where the data exporter is established.

The parties agree that the choice made by the data subject will not prejudice its substantive or procedural rights to seek remedies in accordance with other provisions of national or international law.

Clause 8

Cooperation with supervisory authorities

  1. The data exporter agrees to deposit a copy of this contract with the supervisory authority if it so requests or if such deposit is required under the applicable data protection law.

  2. The parties agree that the supervisory authority has the right to conduct an audit of the data importer, and of any subprocessor, which has the same scope and is subject to the same conditions as would apply to an audit of the data exporter under the applicable data protection law.

  3. The data importer shall promptly inform the data exporter about the existence of legislation applicable to it or any subprocessor preventing the conduct of an audit of the data importer, or any subprocessor, pursuant to paragraph 2. In such a case the data exporter shall be entitled to take the measures foreseen in Clause 5 (b).

Clause 9
Governing Law
The Clauses shall be governed by the law of the Member State where the data exporter is established.

Clause 10
Variation of the contract

The parties undertake not to vary or modify the Clauses. This does not preclude the parties from adding clauses on business related issues where required as long as they do not contradict the Clause.

Clause 11
Subprocessing
  1. The data importer shall not subcontract any of its processing operations performed on behalf of the data exporter under the Clauses without the prior written consent of the data exporter. Where the data importer subcontracts its obligations under the Clauses, with the consent of the data exporter, it shall do so only by way of a written agreement with the subprocessor which imposes the same obligations on the subprocessor as are imposed on the data importer under the Clauses. Where the subprocessor fails to fulfil its data protection obligations under such written agreement the data importer shall remain fully liable to the data exporter for the performance of the subprocessor's obligations under such agreement.

  2. The prior written contract between the data importer and the subprocessor shall also provide for a third-party beneficiary clause as laid down in Clause 3 for cases where the data subject is not able to bring the claim for compensation referred to in paragraph 1 of Clause 6 against the data exporter or the data importer because they have factually disappeared or have ceased to exist in law or have become insolvent and no successor entity has assumed the entire legal obligations of the data exporter or data importer by contract or by operation of law. Such third-party liability of the subprocessor shall be limited to its own processing operations under the Clauses.

  3. The provisions relating to data protection aspects for subprocessing of the contract referred to in paragraph 1 shall be governed by the law of the Member State where the data exporter is established. 

  4. The data exporter shall keep a list of subprocessing agreements concluded under the Clauses and notified by the data importer pursuant to Clause 5 (j), which shall be updated at least once a year. The list shall be available to the data exporter's data protection supervisory authority.

Clause 12
Obligation after the termination of personal data processing services
  1. The parties agree that on the termination of the provision of data processing services, the data importer and the subprocessor shall, at the choice of the data exporter, return all the personal data transferred and the copies thereof to the data exporter or shall destroy all the personal data and certify to the data exporter that it has done so, unless legislation imposed upon the data importer prevents it from returning or destroying all or part of the personal data transferred. In that case, the data importer warrants that it will guarantee the confidentiality of the personal data transferred and will not actively process the personal data transferred anymore.

 

The data importer and the subprocessor warrant that upon request of the data exporter and/or of the supervisory authority, it will submit its data processing facilities for an audit of the measures referred to in paragraph 1.

 

APPENDIX 1 TO THE STANDARD CONTRACTUAL CLAUSES

Data exporter

Customer is the data exporter.

Data importer

The data importer is Avalara, Inc., and its Affiliates (as defined in the Terms), a provider of automated transaction tax compliance solutions.

Data subjects

Data subjects include the Data Exporter’s authorized users, employees, contractors, agents, representatives, or customers.

Categories of data

Data Exporter may submit data to the Data Importer, the extent of which is determined and controlled by the Data Exporter, and which may include certain business information and the following categories of Customer personal data:

 

(i) As to Customer’s Authorized Users, employees, contractors, agents, or representatives: contact details of the individual, which may include name, birthdate, email, user ID, address, and connection data.

(ii) As to Customer’s customers: invoice data, shipment details, and identifier (number and/or free text field as supplied by Customer).

Avalara does not require any special categories of data to be submitted as a precondition to the provision of service.

Processing operations

Personal data may be processed for the following purposes: (a) to provide the Services, (b) to respond to Customer support requests; and (c) otherwise to fulfill the obligations set out in the Terms.

 

APPENDIX 2 TO THE STANDARD CONTRACTUAL CLAUSES

Description of the technical and organisational security measures implemented by the data importer in accordance with Clauses 4(d) and 5(c) (or document/legislation attached):

Information Security Policy Summary

Avalara maintains an information security policy providing direction and support to all levels of the organization, from individual contributor to executive management.  The information security policy has been approved by management, published and communicated to all workforce members and relevant external-parties, and is reviewed annually or when significant changes to the internal or external environment occur to ensure its continued suitability, adequacy and effectiveness.

The information security policy ensures appropriate data protection mechanisms, including technical, process and physical mechanisms, are implemented in accordance with information security best practices, security professional ethics, business requirements, all relevant laws and regulations, data privacy requirements, and private certification and compliance requirements.

Asset Management

  • All information and IT assets are inventoried and clearly identified.

  • All information and IT assets are owned by a designated part of the organization or individual.

  • All equipment and IT assets owned or managed by Avalara must be used exclusively for work-related purposes, except as formally authorized by policy.

  • All information assets are classified in terms of its value, legal and regulatory requirements, sensitivity and criticality to the organization and labeled in order to effectively convey the appropriate information handling and security controls required.

    Human Resources

  • Roles and responsibilities for information security are clearly defined.

  • Employees, contractors and third-party users have background checks performed and be appropriately screened prior to employment.

  • Management is responsible for ensuring that workforce members are adequately trained in information security as it related to their job duties.

  • A disciplinary process is defined and documented for incidents of non-compliance.

  • A documented process is followed in the event of termination or change of employment.

    Physical & Environmental Security

  • All data processing facilities are housed in secure areas and protected by defined security barriers and are protected by damage from fire, flood, earthquake, explosion, civil unrest or other forms of natural or man-made disaster.

  • Sensitive areas of information processing are protected by physical entry controls and entry is logged.

  • Utilities and telecommunications are delivered to data processing facilities via multiple redundant suppliers and paths.

    Operations

  • Standard operating procedures are documented as part of new projects and maintained throughout the life of an information system.

  • Changes to computing environments are controlled, tested and validated.  Multiple environments are maintained in order to provide testing and validation outside of the production environment.

  • Business and technical processes enforce segregation of duties.

  • Use of third-party services is documented, controlled and monitored to ensure compliance with Avalara policies.

  • Anti-virus and anti-malware controls are implemented to prevent malicious code execution.

  • Systems and data are backed up to ensure the availability of information in the event of a disaster.  All media is securely wiped prior to disposal.

  • Infrastructure is scanned for vulnerabilities through periodic scans using automated toolsets.  Patches and updates are prioritized using a risk-based approach and applied using a combination of automated and manual processes.  Systems are maintained and updated according to a regular schedule.

  • Information is protected from disclosure through business process and technical controls during transit, storage and processing.  Mobile computing devices are encrypted to prevent information disclosure in the event of loss or theft.

  • Systems are monitored to detect unauthorized use.

    Access Control

  • Access controls are defined for every information system and define the user provisioning lifecycle.

  • User passwords must meet specific requirements for age, complexity and re-use.

  • User sessions timeout after a specific period of inactivity and require re-authentication.

  • Role-based access controls are implemented and use the principle of least-privilege.

  • Sensitive systems are segregated at the lowest level feasible.

    System Acquisition & Development

  • Security requirements are included in the overall business requirements documentation.

  • Controls are implemented within systems to ensure the validity and completeness of processing, system integrity and auditability.

  • Encryption is used where appropriate to ensure the confidentiality of Avalara and customer data.

  • System development activities comply with technical security requirements regarding the development, testing and production approval of system changes.  Source code is scanned with a combination of automated and manual processes to identify vulnerabilities and remediation is prioritized using a risk-based approach.

    Incident Management

  • All workforce members are required to promptly report any actual or suspected information security incidents, breaches or weaknesses.

  • Incident management processes establish clear incident ownership, roles, responsibilities, communications schedules, plans and other aspects to ensure incidents are handled in a consistent and effective manner.

  • Incidents are investigated for root cause and learnings are applied to policies, procedures, configurations and other areas relevant to the incident.

  • Evidence is collected in a forensically sound manner in order to support possible law enforcement involvement.

    Business Continuity

  • Threats to continued business operations are identified, regularly reviewed, assessed and planned for where necessary.

  • Business continuity plans establish clear ownership, roles, responsibilities, communications schedules, plans and other aspects to ensure business interruptions are handled in a consistent and effective manner. 

  • Business continuity plans are tested regularly to ensure workforce members are familiar with the plans and that plans adequately address the threat against which they were created.

    Legal & Regulatory Compliance

  • Applicable legal, statutory, regulatory and contractual obligations are identified and regularly reviewed.

  • Necessary controls are identified and implemented in order to ensure compliance with identified obligations.

  • Records sufficient to ensure critical information system auditability are generated, protected and preserved as necessary.