Cybersecurity: Legal implications and risk management
What's inside
In an increasingly interconnected world, cyber risk is firmly at the top of the boardroom agenda, and having an effective data breach response programme is no longer optional.
Cybersecurity crisis management
The internet knows no borders, neither do we. Our global team of cybersecurity response experts work across borders, combining data protection, privacy, regulatory, white collar and litigation expertise in order to deliver seamless crisis management and legal advice, whenever and wherever needed.
The digitalization and free flow of information has transformed global business. However, with increased opportunities have come new and increased risks, together with complex legislative regimes that can vary significantly by jurisdiction, and are constantly evolving. Even the most conscientious company can become the victim of a cybersecurity incident, such as the stealing of client or company information, or a ransomware attack. We work with a wide range of multinational companies to manage their cybersecurity risks, developing rapid response plans, providing time-critical crisis management advice, and working with clients to manage any resulting legal issues that may arise.
Key issues
Why?
Reputation
Fines
Breach of contract
M&A due diligence
Insurance
Proprietary information
Litigation
Criminal offences
Negligence
Be prepared
Risk Assessment
Key Information
Assets
Key Systems
Threat Analysis
Security Measures
Toolkit
Scripts
Internal and
External
Communications
Employee contacts
Response Plan
Live Training
Business Continuity Plan
Key considerations
Customer/individual rights
Requests for data
Data Protection Authority Complaints
Group litigation orders
Resolution mechanisms
B2B relationships
Contractual obligations
Contractual liability
Tort
Reputationmanagement
Media strategy
Customer interaction
Employee engagement
Commercial
Proprietary
Information/Trade Secrets
System Disruption
Regulatory issues
Data Protection Authority
Financial Regulators
Market authorities
Other regulators
Privacy & data protection
Jurisdictions involved
Reporting obligations
individuals
authorities
Evidence
Law Enforcement Involvement
Legal Privilege
Preservation of Evidence
Response
Crisis Team
Legal (internal and external)
IT/IT Forensics
PR
Regulatory
DPO
Executive committee
HR
Vendor manager
Key Actions
Work with forensic investigators to:
Identify and contain breach
Gather/preserve evidence
Maximise legal privilege coverage
Contact crisis team
Bring in external partners
Identify key risks and priorities based on nature of breach
Assess notification requirements
Communications
Regulatory notifications
Articles
2025
Reform to the UK’s cybersecurity regime incoming
Changes are coming to the UK’s cybersecurity legal landscape. The new Cyber Security and Resilience (Network and Information Systems) Bill aims to expand legal requirements to more sectors, tighten incident reporting rules, give the Government stronger powers to tackle cyber threats, and ramp up fines for serious breaches.
Member States were required to implement the NIS 2 Directive ("NIS 2") into national law by 17 October 2024. One year on, many EU Member States have failed to meet the transposition deadline, creating confusion and increasing compliance complexity for organisations across the EU.
Cyber Resilience Act: The clock is ticking for compliance
The Cyber Resilience Act (the "CRA") entered into force on 10 December 2024 and applies in full from 11 December 2027. Manufacturers of in-scope products should start the compliance journey as soon as possible to avoid impacts to the product development cycle and non-compliance risk exposure.
Navigating NIS 2: Mastering Compliance and Risk in a Fragmented Cybersecurity Landscape
White & Case Partners John Timmons and Clara Hainsdorf explore the key issues for organizations grappling with NIS 2 compliance in light of the complex implementation landscape.
Ransomware Payments: New legislative proposals in the UK
On 14 January 2025, the Home Office opened a public consultation (the "Consultation") on proposals seeking to address the growing threat and impact of ransomware in the UK.
NYDFS Releases Artificial Intelligence Cybersecurity Guidance For Covered Entities
On October 16, 2024, the New York State Department of Financial Services (the "DFS"), under its Cybersecurity Regulation—23 NYCRR Part 500—issued a memorandum providing guidance on the risks posed by artificial intelligence ("Guidance Memo").
SEC Will Prioritize AI, Cybersecurity, and Crypto in its 2025 Examination Priorities
On October 21, 2024, the US Securities and Exchange Commission ("SEC") Division of Examinations ("Examination Division") announced its 2025 Examination Priorities ("Report").Investment advisers and broker-dealers should ensure that policies, procedures and surveillance efforts related to these priorities address concerns outlined in the Report.
SEC Enforcement Heats up on Key Public Company Topics: Cyber Disclosure, Director Independence and Regulation FD
The U.S. Securities and Exchange Commission's ("SEC") Division of Enforcement has recently brought a spate of enforcement actions relating to key topics for public companies. These include enforcement actions related to cybersecurity incident disclosure, director independence and Regulation Fair Disclosure ("Reg FD") violations, which are described below, and actions based on Section 13 and 16 beneficial ownership filings, as discussed in our prior alert.
Judge Rejects SEC’s Aggressive Approach to Cybersecurity Enforcement
On July 18, 2024, a New York federal judge dismissed most of the US Securities and Exchange Commission's ("SEC") claims against SolarWinds Corp. ("SolarWinds" or the "Company") and its Chief Information Security Officer ("CISO"), Timothy G. Brown, in connection with the Company's cybersecurity practice.
SEC’s Corp Fin Director Issues Statement on Cybersecurity Incident Disclosures
On May 21, 2024, the SEC's Director of the Division of Corporation Finance issued a statement on cybersecurity incident disclosures in light of the SEC's new cybersecurity disclosure rules. Our summary of this statement and key take-aways from White & Case's survey of cybersecurity disclosures is below.
The SEC’s Charges Against SolarWinds and its Chief Information Security Officer Provide Important Cybersecurity Lessons for Public Companies
On October 30, 2023, the US Securities and Exchange Commission ("SEC") announced that it filed charges against SolarWinds Corp. ("SolarWinds" or the "Company") and its Chief Information Security Officer ("CISO") in connection with the SEC Division of Enforcement's ("Enforcement Division") investigation of a cyberattack.
On July 26, 2023, the Securities and Exchange Commission ("SEC"), in a 3-2 vote, adopted rules that will require public companies to make prescribed cybersecurity disclosures.
Shaping the future of digital and cybersecurity governance
In this brief three-minute video, London-based partner Lawson Caisley, Chair of White & Case's Global Cyber Risk Committee, shares his insights on governing cyber risk at the corporate level and some of the challenges of cyber risk management in the boardroom. Filmed at the Digital Directors Network (DDN) Domino 2023 conference on digital and cybersecurity governance.
In this short three-minute video, Washington, DC–based partner F. Paul Pittman discusses the implications of the proposed new SEC rules on cybersecurity governance and what corporate boards can do now. Filmed at the Digital Directors Network (DDN) Domino 2023 conference on digital and cybersecurity governance.
The potential for cybersecurity threats and attacks looms large and the technology companies developing new products and services play a constant game of cat-and-mouse with hackers and cybercriminals for control of cyberspace. Here are six points to consider when analyzing cybersecurity risks and protections.
Directors face personal liability over cybersecurity failures
In an article for The Times, White & Case partner Lawson Caisley discusses why it could become increasingly common for UK directors to "face personal liability and regulatory censure as a result of their company suffering or mishandling a cyberbreach".
Director liability for cyber breaches: transatlantic warning signs?
Two legal cases in the US in the past month suggest that regulators and prosecutors are becoming more determined to take personal action against directors and senior executives who fail to deal adequately with cyber security breaches.
On March 9, 2022, the Securities and Exchange Commission ("SEC") proposed rules that would require public companies to make prescribed cybersecurity disclosures.
In The Legal 500's newly released In-House Lawyer Magazine a group of White & Case lawyers has contributed a legal briefing on trends in German commercial litigation.
AAA plc & ors v Persons Unknown: Cyber Activism or Blackmail?
In recent years, demands for payments in cryptocurrencies have become the ransom of choice for cyber extortionists and other online frauds. As a result, the English Court's powers are increasingly being called upon.
Ninth Circuit Decision Highlights Importance of Updating Risk Factors to Address Material Developments, including those relating to Cybersecurity Risks.
Cybersecurity Enforcement: New York Department of Financial Services issues first penalty under Cybersecurity Regulation
Consistent with its increasing activity in the cybersecurity enforcement space, in March 2021, the NYDFS issued its first penalty under the Cybersecurity Regulation. This client alert explores the settlement and offers takeaways on the areas of focus by the NYDFS in enforcement actions under the Cybersecurity Regulation.
Compensating non-material damages based on Article 82 GDPR
Is a data subject entitled to compensation from a controller or processor if the data subject's GDPR rights have been infringed, even if they have not suffered any kind of material damage?
Cybersecurity Risk: Top 5 strategies to build resilience
The fourth webinar in our 2020 Autumn Webinar Series covered crucial steps you should be taking to protect against cybersecurity threats and what you should do when disaster strikes.
Before the Dust Settles: The California Privacy Rights Act Ballot Initiative Modifies and Expands California Privacy Law
Hot on the heels of the California Attorney General's rulemaking process for the California Consumer Privacy Act ("CCPA"), California voters have passed a ballot initiative to expand and create new privacy rights for consumers.
UK law enforcement can now obtain an order against a person in or operating in the US for the production of or access to electronic data under a new ‘landmark’ US-UK data sharing agreement.
The COVID-19 crisis has exposed many companies to more cyber threats. Tim Hickman and John Timmons discuss what businesses need to do should a major incident occur.
Trending: Legal protection for cryptoasset stakeholders
Recent decisions in Singapore and New Zealand confirm that the courts are prepared to act to provide greater certainty and support to stakeholders in cryptoassets.
Recovering the ransom: High Court confirms Bitcoin status as property
The High Court has determined that Bitcoin (and other similar cryptocurrencies) can be considered property under English law, and could be the subject of a proprietary injunction. The Court granted the injunction to assist an insurance company to recover Bitcoin that it had transferred in order to satisfy a malware ransom demand.
Navigating Privacy and Cyber Incident Notification and Disclosure Requirements
Organisations are facing increasing uncertainty in assessing global notification and disclosure obligations and making a determination of whether to notify or disclose a privacy violation or security incident in today's complex regulatory environment. This article offers six steps companies should consider when navigating this complex process.
Proposal on the Application of the NIS Regulations post-Brexit
This article examines the impact of the UK Network and Information Systems Regulations 2018 (SI 2018/506) (NIS Regulations) on organisations post Brexit and their obligations under applicable cybersecurity law.
On 12 November 2025, the Department for Science, Innovation and Technology introduced the UK Cyber Security and Resilience (Network and Information Systems) Bill (the "Bill") to Parliament.1
Purpose of the Bill
A key aim of the Bill is to address weaknesses, inadequacies, and gaps in the UK's current cybersecurity legislation (i.e., the Network and Information Systems (NIS) Regulations 2018 ("UK NIS")). As cyber threats and attacks increase in number and complexity, there is a growing sense that the UK needs to take action to ensure entities playing a pivotal role in the UK economy are better placed to defend, respond, and recover.
The impact assessment accompanying the Bill (the "Impact Assessment")2 explains that UK businesses and vital public services are increasingly targeted by hostile actors, and that UK NIS is no longer fit for purpose and must be reformed:
…There is a growing threat to our essential and digital services from malicious cyber actors. Cyber attacks are becoming more frequent and sophisticated, with criminals circumventing protections with new techniques and targeting our increasingly complex supply chains to find weak links. At the same time, more state-backed actors are targeting British businesses and services for espionage and extortion, threatening our national security and way of life. Meanwhile, the UK's only cross-sector cyber legislation, the NIS Regulations, have fallen out of date and are insufficient to tackle the cyber threats faced by the UK in 2025 and beyond...3
How will the Bill achieve its aims?
The Bill proposes amendments to UK NIS which will bring more entities within scope, equip regulators with enhanced supervisory and enforcement powers, and empower the Government to amend UK NIS in the future (i.e., to keep pace with intensifying and evolving cyber threats).
It is also worth noting that the approach being proposed in the Bill will result in some alignment with the European Union NIS2 Directive ("NIS2").4 This will be welcome news to entities with exposure to UK and EU cybersecurity laws.
What does the Bill propose?
Among other things, the Bill proposes to:
Bring more sectors and services within scope of UK NIS for the first time: the expanded scope will cover entities such as those operating data centres, and managed service providers (e.g., IT helpdesks, cybersecurity services, etc.), as well as also applying to large load controllers (i.e., systems that remotely control the electricity use of smart systems). Entities which provide cloud computing services, online market places, search engines and other critical sectors (e.g., energy, transport, health and water) continue to be regulated under UK NIS following the introduction of the Bill. The Bill also proposes empowering regulators to designate a service provider as "critical", to bring them within the scope of UK NIS.
By expanding the list of sectors and services within the scope of UK NIS, there will be an increase in the number of businesses that will be required to take steps to manage their cyber risk profile, report cybersecurity incidents, etc. The Impact Assessment explains that this is intended to protect those businesses from the effects of cyber attacks, and make them less attractive to malicious actors; in turn, this will safeguard services relied on by the public and businesses to go about their lives.
Empower the Government to update UK NIS via further secondary legislation: the Bill will introduce powers for the UK Government to update UK NIS in the future which may include, introducing minimum mandatory security measures (e.g., technical, organisational and physical measures, and supply chain security measures, etc.) that must be implemented by in-scope entities.
According to the Impact Assessment, this will assist with ensuring that UK NIS remains effective against the ever-changing cyber landscape, and will enable the Government to update and strengthen security requirements to bring them into closer alignment with recommendations from the UK's National Cyber Security Centre and with international best practices.
Introduce more prescriptive incident reporting requirements: the Bill will introduce expanded incident reporting requirements, as in-scope entities will be required to notify the relevant regulator about incidents (e.g., cyber-attacks) that have, or are capable of having, a significant impact on the continuity of their services. UK NIS currently only requires notification of incidents that have actually caused disruption.
In-scope entities will be required to submit: (i) an initial notification within 24 hours of becoming aware of a significant incident; and (ii) a full notification within 72 hours.
The proposed changes will have an operational and resource impact on in-scope entities; however, it will also bring the incident reporting regime closer to that established under NIS2.
Empower the Government to give specific directions to individual entities: where necessary in the interests of national security (e.g., in the context of a cyber attack affecting an entity), the Government may direct that entity to take / not take specific actions (e.g., implement specific cybersecurity measures, provide information to the Government, restrict use of certain services or facilities, appoint a specialist for specific purposes, etc.).
Increase maximum fines to the greater of £17 million or 4% of turnover for serious breaches: the introduction of the percentage of turnover penalty brings the potential maximum fine into line with analogous legislation, like the UK GDPR. The maximum fine for failing to comply with a direction given by the Government (discussed above) is even higher, at the greater of £17 million or 10% of turnover.
Extra-territorial reach
Providers of cloud computing services, online market places, search engines and managed services that are established outside of the UK will be required to appoint a representative within the UK, and to register with the Information Commissioner within three months of the Bill coming into force.
Time to plan ahead
The Bill completed its 1st reading on 12 November 2025 and is still in the early stages of progressing through Parliament. Businesses likely to be in-scope of the reformed UK NIS should keep a close watch on the developments and be prepared to start the compliance planning process. As the Bill progresses through Parliament, we recommend:
Continuing to monitor for developments.
Assessing whether the business falls within the expanded scope of UK NIS (e.g., as a data centre, managed service provider, etc.).
Considering whether existing incident detection and reporting procedures will be sufficient in light of the Bill's more prescriptive incident reporting requirements and update procedures as necessary (e.g., to meet new 24 hour initial notification requirement).
Conducting cybersecurity audits and assessments, and remediating gaps as necessary to ensure cybersecurity posture is robust.
Questions?
Please contact John Timmons or Joe Devine if you have any questions, or if you require assistance with the matters discussed in this article.
Emily Digby (Trainee Solicitor, United Kingdom, White & Case) co-authored this publication.
1 You can find a copy of the Bill here. 2 You can access the Impact Assessment here. 3 P.5 of the Impact Assessment. 4 For more information on NIS2, you can: (i) watch our webinar which explores the key issues for organizations grappling with NIS 2 compliance; and (ii) read our alert on the transposition status of NIS 2 here.
White & Case means the international legal practice comprising White & Case LLP, a New York State registered limited liability partnership, White & Case LLP, a limited liability partnership incorporated under English law and all other affiliated partnerships, companies and entities.
This article is prepared for the general information of interested persons. It is not, and does not attempt to be, comprehensive in nature. Due to the general nature of its content, it should not be regarded as legal advice.