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Start for freeThe Evolution of Cybersecurity Legislation
Cybersecurity legislation has come a long way since its inception in the late 20th century. Initially, these regulations were localized and focused on protecting sensitive information stored in digital form. Some early examples include:
- The UK Data Protection Act
- The Computer Fraud and Abuse Act in the United States
As time progressed, specialized requirements for specific industries began to emerge:
- HIPAA in healthcare
- FISMA for controlling government institutions in the US
- Various regulations in the financial sector
These early laws were characterized by more general prescriptions, limited scope, and a focus on the interests of specific territories and industries.
With the increasing connectivity between countries and the deepening of information and trade relationships, the need for more comprehensive laws was identified. In the European Union, this led to the development of:
- The NIS Directive, which prescribes minimum requirements for critical and essential organizations in member states
- The GDPR, which focuses on protecting users' personal data
Current Cybersecurity Landscape
The current cybersecurity landscape is characterized by:
- A constantly growing number of incidents
- Increasing financial losses from cybercrimes
According to a Forrester study, cybercrime damages are expected to reach $12 trillion by 2025. PwC's Digital Trust Insights survey, conducted in 2024 with over 900 organizations worldwide, calculated that the average loss from cyber incidents for organizations is over $3 million.
When comparing figures for Central and Eastern Europe with the rest of the world, organizations in this region still suffer significantly fewer losses. However, the trend indicates that they will soon catch up with the Western world.
On a positive note, the survey confirms that for another consecutive year, both technical and business senior management identify cyber risks and risks from new technologies as a top three priority for their organization.
Emerging Technologies and Associated Risks
Businesses in recent years have been rapidly integrating and implementing new technologies to:
- Make better, more informed decisions
- Manage resources more effectively
- Improve communication with customers
Some key trends include:
- Digitalization
- Automation of business and production processes
- Implementation of machine learning models
- Development of artificial intelligence
However, these new technologies bring both opportunities and risks:
- Insufficient IT literacy among employees and customers
- Technical vulnerabilities in information and operational technologies
- Inefficient and insecure data management
Combined with the turbulent geopolitical situation of recent years, these factors have led to the need for legal frameworks such as NIS2, DORA, and the AI Act.
Key Regulations: NIS2, DORA, and AI Act
NIS2 Directive
The NIS2 Directive builds upon its predecessor, the NIS Directive, by covering a broader spectrum of companies. This now includes medium-sized enterprises from critical sectors such as healthcare, energy, and critical IT infrastructure.
Key requirements of NIS2 include:
- Improved management of cybersecurity-related risks
- Better management and reporting of incidents
Digital Operational Resilience Act (DORA)
DORA focuses on the financial sector, including organizations such as:
- Banks
- Insurance companies
- Their key ICT service and product providers
The scope of DORA largely overlaps with that of NIS2, with a focus on:
- Risk management
- Operational resilience management
- Incident management
AI Act
The AI Act has a broad applicability and a risk-based approach. It applies to all providers and users of AI systems, with requirements based on the criticality and risk classification of these systems.
Key requirements include:
- Improved risk management
- Comprehensive monitoring to ensure transparent and ethical use of AI systems
A crucial aspect of all three regulations is that the regulator provides for strict supervision of their applicability and severe sanctions for non-compliance.
Importance of These Regulations
These regulations are crucial for several reasons:
- Strengthening security and resilience of key companies in member states
- Enhancing trust and accountability by defining clear criteria for cybersecurity, operational continuity, and ethical AI
- Addressing key risks in critical sectors, such as:
- Third-party risks
- Risks of private data leakage
- AI abuse
- Harmonizing the digital environment to build a more connected and resilient digital infrastructure
- Positioning Europe as a global leader in responsible technology use
Compliance Challenges
Despite the approaching deadlines for NIS2 and DORA implementation, many organizations are not yet fully compliant. According to the PwC Digital Trust Insights survey:
- Over 30% of organizations believe they are not ready for NIS2 compliance
- About 50% of EU organizations are not prepared for DORA and AI Act compliance
In Bulgaria and the Balkans, the statistics are even more pessimistic.
Key challenges preventing organizations from achieving compliance include:
- Lack of sufficient engagement at the board and senior management level
- Difficulty in implementing technical requirements, particularly in incident management
- Challenges in third-party risk management
Strategies for Compliance and Enhanced Security
To address these challenges and improve overall security, organizations should focus on:
- Better security processes
- Improved risk management
- Higher engagement at the board and senior management level
One of the most effective ways to achieve compliance and enhance security is through the implementation of standards and best practices, such as ISO 27001 and the NIST Cybersecurity Framework.
Recent Changes in ISO 27001 and NIST Cybersecurity Framework
Both ISO 27001 and the NIST Cybersecurity Framework have undergone significant changes in the past two years. These changes introduce:
- More stringent technical measures
- A more structured, holistic approach to security
- Better-structured security measures
- Emphasis on board and senior management responsibility for cybersecurity
Key updates include:
- Better overall structuring of security measures
- Updated security controls
- Additional measures for threat intelligence, cloud security, operational resilience, and incident management
These changes align closely with the requirements of NIS2 and DORA.
Modern Approaches to Security and Compliance
In addition to implementing updated standards, organizations can explore modern approaches to enhance their overall security and achieve compliance. One example is the Zero Trust Security Architecture, which provides a comprehensive approach to security in today's complex digital environments.
Conclusion
While frameworks like the NIST Cybersecurity Framework and ISO 27001 were not explicitly created for compliance with new regulations, their recent updates reflect global trends and regulatory requirements, including:
- Improved resilience
- Comprehensive risk management
- Overall cybersecurity governance
Organizations can use these frameworks as a foundation for their security and compliance efforts. However, they must also consider the specific requirements of each regulation to achieve full compliance.
The task ahead for organizations is challenging. They must keep pace with new trends to remain competitive while protecting the trust and data of their customers. Cybersecurity must move beyond being a topic of discussion at forums and become a goal and focus for companies.
It's worth noting that regulations often lag behind the emergence of new threats. For example, the first cybersecurity law was introduced in the late 1980s, while the first cyberattack occurred in 1962 - 20 years earlier. This underscores the importance of proactive cybersecurity measures, as businesses cannot afford to wait for regulations to catch up with emerging threats.
As the digital landscape continues to evolve, organizations must remain vigilant, adaptable, and committed to maintaining robust cybersecurity practices. By doing so, they can not only meet regulatory requirements but also build trust with their customers and stakeholders, ultimately contributing to their long-term success and resilience in an increasingly digital world.
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