Digital Gold or Privacy Minefield? The Case for GDPR in Ecuador

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Introduction

Along with right to liberty, freedom of thought and expression we have the right to privacy under Article 7 and the right to personal data protection under Article 8 of European Charter of Human Rights. General Data Protection Regulation (GDPR) stands as a comprehensive regulation that offers citizens strong protection and enforceable rights and over 7 years since its’ implementation, has become a great example of how it empowers citizens and provides business opportunities.

The initial objectives of GDPR are:

• Lawfulness, Fairness & Transparency

• Data, Purpose & Storage Limitation

• Harmonization of Data Protection Laws

• Granting Individual more rights and Protecting Personal Data

Although not perfect, it has become a reference point for other countries that want to grant their citizens a high level of protection. The strict set of guidelines is not only beneficial for the citizen, but for government who want to improve their international trade relations. The growth of digital commerce is worldwide and whilst some Latin American countries have adopted local privacy laws, they often lack the enforcement power and robustness of GDPR, leaving personal data vulnerable to misuse.

Background: Data Protection Challenges in Latin America

To consider Ecuador as a particular example of a country that strives to improve its international relations and has made steps towards enhancing data protection by implementing The Organic Law on Personal Data Protection (Ley Orgánica de Protección de Datos Personales en Ecuador LOPDP) which was inspired by GDPR. The question is not about improving current laws, but strategically integrate GDPR principles to aid businesses, consumers and the government. Ecuador should look at legislative framework of data protection in Europe and follow by implementing supporting regulations similar to The Law Enforcement Directive to improve critical areas of lack of enforcement and compliance. Additionally, Ecuador should consider its cultural challenges- if you have ever travelled to Ecuador, you may be surprised when asked for personal identification information when making a purchase. To a Westerner, sharing your passport number when purchasing groceries is not desirable, however it is a standard practice for maintaining taxes for citizens of Ecuador. Along those lines, there is a general lack of understand regarding informed consent for citizens and issues with defining purpose processing for private and public sectors.[1]

The Power of Consent

Consent is the gateway for obtaining personal information. Ecuador not only faces with lack of understanding regarding consent from the citizens, but also with less rigid laws, as the LOPDP only requires informed consent for personal information, whereas GDPR sets out stricter requirements with explicit consent and clear opt-out mechanisms. However, even in the EU ‘consent fatigue’ has emerged as a major issue, where individuals frequently click "Accept" without fully reading privacy policies, undermining the principle of informed decision-making. The overwhelming amount of consent requests, often presented in complex legal language, discourages users from engaging with the details of their data rights. In contrast, Ecuador faces digital illiteracy as a significant barrier—many citizens lack awareness of their data protection rights, making them more vulnerable to improperly obtained consent. Without clear explanations and widespread education initiatives, Ecuadorians may unwittingly grant consent without understanding the implications, further weakening the effectiveness of privacy regulations. Strengthening public awareness campaigns, simplifying consent requests, and enforcing explicit consent standards could help Ecuador bridge the gap and prevent the same pitfalls seen in GDPR-regulated environments.

Stronger Consumer Trust and Data Security

Even though the LOPDP has the foundations to follow the transparency requirements that are set out in GDPR, there are weak enforcement mechanisms and lack of funding for organisations such as Superintendence of Personal Data Protection (SPDP). One of GDPR’s key contributions to trust is the requirement for accountability in data processing. Organizations must justify the collection and use of personal data, ensuring that information is handled ethically and only for legitimate purposes. This promotes responsible business practices, reducing the risk of data misuse or unethical profiling. Without stricter oversight and accessible consent procedures, consumers may remain hesitant to fully engage in digital services, fearing that their information is mishandled.

The Role of Cybersecurity in Business Reputation

Implementing GDPR’s stricter requirements should be reflected in how businesses approach their cybersecurity as a crucial part of building strong consumer trust as well as demonstrating their commitment to international data protection standards. By aligning with GDPR-level security measures, Ecuadorian businesses can facilitate smoother international trade relations, as companies and consumers from other countries will be more willing to engage with them, knowing their data is handled with the same level of care and compliance required in the EU. This regulatory alignment not only enhances credibility but also opens doors to global partnerships, making Ecuador a more attractive destination for digital investments and cross-border commerce.  Latin American countries should take full advantage of established European data protection laws, particularly by learning from past challenges and enforcement gaps. Recent cyberattacks on Marks & Spencer and Co-Op illustrate how a lack of transparency can severely undermine consumer trust. However, without adequate funding for Ecuador’s Data Protection Superintendency, such breaches may go unnoticed, preventing businesses from learning from their mistakes. In the UK, Merseyside Law Firm was fined £60,000 following a cyberattack that exposed highly sensitive client data on the dark web—an incident that highlights the importance of robust enforcement mechanisms. Strengthening Ecuador’s regulatory framework and ensuring proper oversight could help prevent similar data security failures while fostering consumer confidence in digital services.

International Data Transfers and Trade

Regulatory compliance remains a crucial factor, even for leading global corporations operating in developed economies. Apple and Meta have repeatedly faced scrutiny from the European Commission, demonstrating that no entity—regardless of size or market dominance—is exempt from enforcement. Recent cases under the Digital Markets Act have led to substantial financial penalties, with hefty fines reaching up to EUR 500 million for Apple and EUR 200 million for Meta. These instances highlight the growing emphasis on regulatory oversight, reinforcing the need for companies to proactively adapt their compliance strategies to evolving legal frameworks. For businesses in Latin America, learning from these high-profile cases can provide valuable insight into the risks associated with non-compliance and the necessity of establishing robust compliance mechanisms early on.

Personal data has become a valuable business asset; therefore, availability of international data transfers are crucial for business for a foundation on global commerce. Whether through consumer analytics, financial transactions, AI development, or cross-border collaborations, unrestricted access to international data transfers is crucial for maintaining competitiveness and fostering economic expansion. The recent CJEU Schrems II ruling has significantly impacted international status. The case invalidated the EU- U.S. Privacy shield due to lack of adequate protections for European citizens in U.S. surveillance laws. However, the effect of this case is global, as it has reinforced the necessity of strong compliance mechanisms for cross-border data flows.

The European Commission updated Standard Contractual Clauses, which offer a lawful framework for international transfers with enhanced safeguards. GDPR plays a crucial role in maintaining protections through Article 45, which entails a Commission adequacy decision when assessing third countries or international organisation. The assessment of adequate level of protection includes:

• The Rule of Law – in addition to implementation of legislation for data protection, an effective administrative and judicial redress

• Existence of effective and functioning independent supervisory authorities – responsible for enforcement and compliance

• Commitments to legally binding conventions or instruments

Maintaining enhanced protection is further enforced by Article 97, which requires emission of public reports that examine application and functioning of Article 45. Ecuador has the basis for complying with Article 45 through LOPDP and SPDP. However as recently highlighted by national policy framework (Plan Nacional De Protección De Datos Personales 2025),[2] released by regulatory authority SPDP, there are structural, cultural difficulties as well as institutional weaknesses that stand in the way of adequate enforcement.

Ecuador is part of the Red Iberoamericana de Protección de Datos (RIPD), which is a regional network that brings together data protection authorities from Ibero-American countries to promote cooperation, regulatory alignment, and best practices in privacy and data governance. The standards for Ibo-American take inspiration explicitly from GDPR. However, some Latin American countries like Uruguay, Argentina and Mexico have taken further steps by signing the Convention for the Protection of Individuals with regard to Automatic Processing of Personal Data (Convention 108). This Convention is the only comprehensive and binding data protection framework at an international level. If Ecuador were to engage with the Convention 108, it can support its efforts to modernize its legal framework, improve institutional oversight, and most importantly enhance its credibility in international data governance discussions.

Challenges to Implementation

Despite being a global benchmark in data protection, the GDPR remains static, often struggling to keep pace with rapid technological advancements. Critics argue that its framework reflects the era in which it was drafted, lacking explicit references to artificial intelligence, autonomous systems, machine learning, and big data—all fundamental components of modern digital ecosystems. This gap leaves room for Big Tech to maneuver around compliance, exploiting areas where regulation falls behind innovation. Given these limitations, GDPR alone is insufficient as the sole regulatory foundation for countries like Ecuador, where emerging technologies demand a more comprehensive, future-proof framework. Instead, compliance strategies should incorporate additional regulations such as the ePrivacy Regulation, the Artificial Intelligence Act, and the Digital Services and Markets Acts, ensuring that governance remains adaptive, enforceable, and aligned with evolving digital risks.

Why European rather than U.S.? The reasoning is largely geopolitical. Ecuador has long struggled with institutional corruption, undermining public trust in governance. The ‘Californian’ approach, which prioritizes the ‘public good’ and enables broad government surveillance, poses significant risks in a country where concerns over state overreach remain high. In contrast, the European model offers a more balanced framework—one that fosters innovation while ensuring robust privacy protections. This approach aligns better with Ecuador’s need for both technological advancement and safeguards against misuse of personal data.

Conclusion

Data has become recognized as a key economic and business asset, especially when it comes to innovation and competitiveness. The laws are intended to make data available to enable data-driven economies, but at the same time, they limit that data to protect the rights and interests of data holders.

The European approach provides not only a robust framework for data protection but also a gateway to international trade and digital credibility. The benefits are clear: enhanced consumer trust, strengthened enforcement mechanisms, and greater alignment with global standards. But without action, these advantages remain theoretical. Governments must move beyond symbolic regulations, businesses must embrace compliance as a competitive advantage, and consumers must stop blindly handing over their data without understanding its value.

Ecuador has already taken important steps toward data sovereignty, yet structural weaknesses and enforcement gaps continue to leave its digital landscape vulnerable. Looking ahead, the choice is clear: either embrace data protection as an asset, aligning with GDPR principles and Convention 108, or risk falling behind in the global digital economy. The days of unregulated data exchanges are numbered—those who fail to adapt will find themselves at the mercy of the next data scandal or regulatory crackdown. Data protection isn’t just a legal requirement. It’s a strategic necessity, a business advantage, and, ultimately, the foundation of trust in the digital world. Effort must be placed in securing appropriate funding and fostering much-needed cultural education. Digital markets operate beyond traditional trade borders, meaning Ecuador has the potential to position itself as a first-world player in the digital economy.

[1] E L Rodríguez Almache, J L Rodríguez Bustamante and J J Santacruz Espinoza, 'Implementation and Challenges of the Principles of the Organic Law on Personal Data Protection in Ecuador: A Systematic Review Approach' (2024) 8 Pro Sciences: Journal of Production, Sciences and Research 47 https://journalprosciences.com/index.php/ps/article/view/753 

[2] Plan Nacional De Protección De Datos Personales, Superintendencia De Protección De Datos Personales (12 May 2025) PLAN NRO. PLN-SPDP-PGE-2025-0003 <https://media.licdn.com/dms/document/media/v2/D4E1FAQE-dGMabZsYhA/feedshare-document-pdf-analyzed/B4EZb50Q00GUAY-/0/1747947957558?e=1749081600&v=beta&t=7nNA_G5FcRD6LoYZ7UWjELBxv_SSkuO_RxPr8XSBCP0>