Understanding the Notifiable Data Breaches Scheme: A Practical Guide for Organizations

In Australia, the Notifiable Data Breaches Scheme (NDB Scheme) sits beneath the Privacy Act 1988. It requires organisations to act quickly when personal information is compromised in a way that could cause serious harm. This article explains how the Notifiable Data Breaches Scheme works, who it covers, and how teams can respond effectively to protect customers and comply with the law.

Created to promote transparency and accountability, the Notifiable Data Breaches Scheme asks organisations to assess breaches for potential harm and to communicate with both the OAIC (Office of the Australian Information Commissioner) and affected individuals when necessary. The aim is to minimise damage, help people take protective steps, and strengthen trust in data practices across sectors.

What is the Notifiable Data Breaches Scheme?

The Notifiable Data Breaches Scheme, often referred to as the NDB Scheme, is a statutory requirement for organisations that are subject to the Privacy Act to notify certain data breaches. An eligible breach occurs when the breach is likely to result in serious harm to a person whose personal information is involved. The Notifiable Data Breaches Scheme covers unauthorised access, unauthorised disclosure, or loss of personal information, whether the breach was intentional, negligent, or the result of a system fault.

Key features of the Notifiable Data Breaches Scheme include a clear threshold for “serious harm,” a structured notification process, and a governance framework that encourages prompt action and remediation. The scheme also interacts with other privacy obligations under the Privacy Act, such as data minimisation, purpose limitation, and security practices.

Who is covered by the Notifiable Data Breaches Scheme?

Most APP (Australian Privacy Principles) entities fall within the scope of the Notifiable Data Breaches Scheme. This includes private sector organisations, government agencies, and not-for-profits that handle personal information in the course of their operations. There are exemptions and specific rules for certain kinds of data or organisations, such as employee records in some contexts or data that falls outside the Privacy Act’s coverage. Because the landscape can be nuanced, it is wise to review OAIC guidance and seek privacy advice if you are unsure whether your organisation is obligated to act under the Notifiable Data Breaches Scheme.

What counts as an eligible data breach?

An eligible data breach under the Notifiable Data Breaches Scheme is one that is likely to result in serious harm due to unauthorised access, disclosure, or loss of personal information. The breach can be actual or suspected, and it can involve a portion of data or an entire dataset. Serious harm encompasses a range of risks, including identity theft, financial loss, impersonation, physical or psychological harm, or damage to safety or reputation. The assessment is not solely about the technical breach; it’s about the potential real-world impact on individuals.

When must you notify?

Notification under the Notifiable Data Breaches Scheme occurs when an organisation becomes aware of an eligible data breach. The general rule is to notify as soon as practicable and, where feasible, within 30 days after becoming aware of the breach. Notifications to the OAIC and to affected individuals should include enough detail to understand the breach, its potential impact, and the steps being taken to mitigate harm. If a breach is likely to result in serious harm, swift notification is particularly important to support risk mitigation by individuals and to preserve trust in the responding organisation.

What information should be included in a breach notification?

• The identity and contact details of the reporting organisation.
• A description of the breach, including the date or approximate date it occurred.
• The kinds of information involved (e.g., names, addresses, financial information, health data).
• Potential harms that could result from the breach (such as identity theft or financial loss).
• What actions the organisation has taken or will take to mitigate the harm (e.g., resetting passwords, offering credit monitoring).
• Advice to individuals on steps they can take to protect themselves (e.g., reviewing account statements, enabling two-factor authentication).
• Contact details for follow-up questions or support.

How to respond: a practical incident plan

1. Contain the breach: isolate affected systems, preserve evidence, and stop further exposure.
2. Assess the scope: determine whether the breach qualifies as an eligible data breach under the Notifiable Data Breaches Scheme and whether serious harm is likely.
3. Decide on notification: if required, prepare notifications for the OAIC and affected individuals in line with the 30-day guideline.
4. Document decisions: keep a clear record of the breach, the assessment, and the actions taken for accountability and possible audits.
5. Mitigate harm: change passwords, monitor for suspicious activity, offer support such as identity protection services where appropriate.
6. Review controls: identify weaknesses in data handling, access controls, encryption, and monitoring to reduce the chance of recurrence.
7. Communicate and train: update policies, run staff training, and reinforce privacy and security culture across the organisation.

Best practices to prevent breaches and reduce risk

• Data minimisation: collect only what is needed and retain information only as long as necessary.
• Strong access controls: enforce least privilege, use multi-factor authentication, and regularly review user access.
• Encryption: encrypt sensitive data at rest and in transit to reduce the impact of any breach.
• Continuous monitoring: implement security monitoring, anomaly detection, and timely incident response drills.
• Third-party risk management: ensure vendors and partners meet the same privacy and security standards and have clear breach notification processes.
• Well-documented response plans: maintain a tested incident response plan that is easily actionable when a breach occurs.
• Ongoing privacy education: provide regular training on phishing, social engineering, data handling, and breach reporting.

Common misconceptions about the Notifiable Data Breaches Scheme

• The scheme only applies to large organisations. In reality, any APP entity handling personal information may be affected, and breaches must be evaluated against the serious-harm threshold.
• Notifications are optional if you think a breach is not serious. The obligation focuses on the likelihood of serious harm, but if there is any doubt, seek guidance from OAIC or privacy professionals.
• The Notifiable Data Breaches Scheme is just about reporting to the regulator. It also requires notifying affected individuals and implementing remedies to prevent recurrence.

Conclusion

The Notifiable Data Breaches Scheme is a cornerstone of responsible data governance in Australia. It creates a clear expectation that organisations act quickly when personal information is compromised, informing both regulators and individuals and taking steps to mitigate harm. By building a proactive privacy and security program—combining people, processes, and technology—organisations can lower the probability of breaches and respond effectively when incidents occur. For teams managing privacy and security, a well-practised Notifiable Data Breaches Scheme process supports trust, accountability, and resilience in a data-driven world.