The Impact of Government Regulations on Business VPN Usage

Government Regulations and Business VPN

Government regulation allows for entire industries to benefit from widespread protection and data control. By forcing a certain minimum degree of security protocols, customers and employees are protected from profiteering criminals and national cyber threats.

Virtual Private Networks (VPNs) are accessible yet powerful components within a security tech stack – but their role is tantamount to your local regulation. This post assesses the ongoing roles that VPNs play in regards to regulations such as GDPR, CCPA, and ISO 27001 – and how you can stay compliant.

Quick Takeaways

  • Regulations are simple: They largely require organizations to handle personal data in a transparent and secure way.
  • VPNs support this in three ways: Encrypting data in transit, adding a layer of user authentication, and finally by segmenting user access into zones of control.
  • Setup is critical: Whether remote or on-site, an appropriate VPN setup bolsters regulation adherence – and customer trust.

What Is a Business VPN?

Much like its smaller, consumer-focused counterpart, a business VPN allows Internet users to access a private server or resource without exposing user information to the wider network or Internet Service Provider (ISP). Without a VPN, an end-user must otherwise rely on their home network, or that of the public place they’re working from. 

This means that – should the ISP be compromised, or traffic from the home network be intercepted in any way – the company’s sensitive resources risk being exposed. For organizations that rely on remote workers, a VPN offers a way to protect at-home users’ internet traffic via an encrypted tunnel.

But adding a component to an enterprise’s tech stack that handles raw traffic data comes with its own set of regulatory requirements. 

VPN Regulations Around the World

The impact of government regulations on business VPNs is wide-ranging. Different countries have their own demands for VPN traffic: some, like China and Russia, prioritize the ability for VPN providers to track users’ site visits on a governmental scale. 

This is why in both of these countries, the use of unauthorized VPNs is illegal. 

Multinational corporations cannot set up their own proxy networks – instead, they must rent lines from authorized VPN providers. Other countries take a slightly less stringent approach, and instead mandate how enterprises handle the security implications of VPNs. 

European Regulations – GDPR

GDPR has protected European nationals’ online privacy since 2018. Under GDPR, all personal information of customers and employees should be:

  • Processed fairly and lawfully.
  • Obtained for a specific lawful reason.
  • Kept securely.

As VPN clients need to be set up on almost every employee’s device, the ramifications of GDPR are significant. It’s necessary for the client to keep track of certain logs – as this is how authentication and access are administered to each user. However, not all logs are built equally. 

The two types are:

  • Browsing logs. More in-depth, detailing the sites and servers each user visits.
  • Connection logs. Detail what user is logged on and the timestamps of various internet connections.

If an enterprise relies on both connection and browsing logs, the higher degree of personal data being collected needs to be kept in a suitably secure fashion. Otherwise, your users could be at risk of replay attacks – where attackers capture and resend authentication details for malicious gain.

Another key component of GDPR is record deletion. When an employee leaves or a user requests it, an enterprise needs to be able to remove every piece of personal information. This can be difficult when there’s a bunch of different servers generating logs. To maintain GDPR compliance, discarded files need to be removed – usually by moving them to the server’s ‘black hole’ file. 

Note, however, that VPN providers are legally required to produce connection logs when requested by law enforcement. 

American – CCPA/APRA

Like GDPR, organizations that handle the customer data of Californian citizens are legally required not only to provide or edit that data at the behest of the customer, but further implement reasonable security practices for keeping the data safe. US federal privacy laws are gaining even more momentum – the American Privacy Rights Act (APRA) is currently undergoing extensive drafting, before being put to the House and Senate. 

Dubbed the American version of GDPR, there are already significant overlaps with its European counterpart. 

International – ISO 27001

ISO27001 doesn’t apply to particular territories, but is instead a voluntary certification that’s popular within IT and financial sectors. When considering ISO 27001 compliance, it’s easier to contextualize VPNs within the wider field of remote access.

For instance, ISO 27001 demands that remote access must be safeguarded with strong encryption. VPNs provide this via AES encryption: by grouping text into a series of grids, an AES algorithm swaps each chunk and column on both vertical and horizontal axes. For 256-bit keys, this re-shuffling process occurs 14 consecutive times. 

This is essentially un-decryptable for anyone who doesn’t have the key. 

Alongside encryption, ISO27001 recommends avoiding split tunneling. This essentially segments enterprise resources into two types – sensitive and public – and only applies VPN connection protocols to the former. While technically serving public-internet resources faster, split tunneling still leaves employees and the network exposed to attack. Rather than relying on split tunneling, remote users should be connected solely to the company’s network. 

Benefits of Government Regulations

The core principle of regulations such as GDPR is educating people about their personal data. This greater focus leads to the following benefits:

  • Better cultural understanding of the importance of data security within an organization.
  • By adhering to a single set of rules, organizations with multiple European offices benefit from greater harmonization, helping simplify security tooling and network architecture. 
  • As methods of encrypting in-transit data, VPNs offer a significant step forward toward regulatory adherence.
  • The logs created by VPNs offer security teams greater visibility and control over endpoint traffic.
  • Companies that take the time to study their data modeling are consistently able to manage that data more efficiently throughout its entire lifecycle.

7 Tips for Achieving Full Compliance 

#1. Understand what personal data is – and what you hold

In many regulations’ eyes, the definition of “personal data” is extremely broad, encompassing not just names, addresses, and bank details, but also information related to religion, race, mental or physical characteristics – even technical aspects such as IP addresses, web cookies, contacts, and mobile device IDs. 

Document precisely which data your organization handles, and how much. This may require conducting an information audit. 

#2. Understand what regulations you fall under the scope of

Crucially, international regulations such as GDPR have a wide-reaching territorial scope. According to Article 3, any company worldwide must adhere to the GDPR if it processes personal data of individuals residing in the EU. This applies regardless of whether the company has a physical presence or conducts business transactions within the EU. Simply handling the personal data of an EU resident obligates the company to comply with GDPR regulations, or risk facing significant financial penalties. Know exactly what scope your data falls under.

Across GDPR and CPPA, the ability to ensure the confidentiality, integrity, availability, and resilience of personal data processes is critical. For this, the next few tips can drastically help:

#3. Select a VPN with accepted standards

VPNs that adhere to accepted standards, such as Internet Key Exchange/Internet Protocol Security (IKE/IPSec), are generally safer, faster, and more secure than their SSL/TLS counterparts. 

If your VPN tool uses a custom SSL/TLS tunnel as a fallback, disable this functionality.

#4. Go for centralized management

Rather than demanding more and more man hours from a limited IT team, go for security solutions that protect and consolidate: this allows wider-scale management of user access, usage, and security from a single interface.

#5. Make use of network segmentation 

To remain adherent to the concept of suitable data protection, it’s common for compliant network architectures to group data access by risk. 

This more complex approach lays out the network into zones, each accessible by groups of authorized users. This then utilizes a VPN as a way to secure the access layer – different risk levels get their own VPN access. At the same time, this architecture can protect internal databases via a firewall that only permits VPN traffic.

#6. Ensure your VPN has a kill switch

This killswitch stops a device connecting to the internet in the event of the VPN connection dropping – preventing data from being sent or received outside the VPN tunnel.

#7. Protect remote access points with multi-factor authentication 

VPNs are powerful ways of encryption in-transit data and protecting endpoints, but unsecured VPNs represent single points of failure. To manage this, connect it with your enterprise single sign on (SSO) service, which should already encompass MFA

This automates and simplifies credential management for users.

Develop Regulation-Proof Security with Perimeter81

Your organization has enough on its hands, without the added stress of geographic regulation (or facing geo-restricted content). Rather than being stuck between the heavy fines of non-compliance and the headache of complete overhaul, Perimeter81’s market-leading VPN offers a step toward complete compliance. 

Deploy private servers with a single click; improve latency with our 40+ data centers across the globe. Reach a global audience and streamline your VPN security into a single dashboard with Perimeter81.


How does GDPR impact the use of VPNs in an enterprise setting?
GDPR requires enterprises to secure data transmissions, maintain data integrity, and provide robust access controls. These can all be aided by the implementation of a VPN.
What risks are associated with using VPNs that rely on custom SSL/TLS tunnels, and how can they be mitigated?
VPNs relying on custom SSL/TLS tunnels may pose security risks due to potential vulnerabilities in the custom code. These risks can be mitigated by disabling the fallback to custom SSL/TLS tunnels and instead using VPNs that adhere to widely accepted standards like IKE/IPSec.
How can a VPN be kept safe?
Regularly updating and patching VPN software, conducting security audits, and choosing reputable VPN providers with strong security track records all bolsters VPN security.
How can IT administrators effectively manage enterprise VPNs to ensure regulatory compliance?
Implementing strong authentication methods, maintaining up-to-date documentation of data flows, and conducting regular security assessments are essential. Administrators should also ensure the VPN infrastructure supports compliance requirements, such as data encryption, secure logging, and the ability to respond to data breaches promptly.
Is a centralized interface important for VPN security?
While not essential, a centralized management interface allows for more integrated user access and usage monitoring, further supporting rapid response to suspected breaches or compromise.

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