Practice review: data-compliance diligence in cross-border M&A
Acquiring an overseas company may mean buying a pile of non-compliant data assets. Data diligence is becoming deal-critical.
In a typical cross-border M&A scenario, the buyer focuses on revenue and technology and easily overlooks the target's data-compliance posture — potentially the largest hidden liability.
Data diligence looks at whether user-data collection has a lawful basis, whether cross-border transfers are compliant, whether there is an undisclosed breach history, and whether data assets can lawfully transfer with the deal.
The review's point is to fold data compliance into deal terms: allocate risk via representations and warranties, special indemnities, or pre-closing remediation conditions.
The lesson: when data is an asset, data-compliance diligence belongs alongside financial and legal diligence, not as an afterthought.