What is the impact of GDPR on businesses outside the EU?

The choice indicating that businesses outside the EU must comply with EU data protection standards if they are handling personal data of EU citizens is correct because the General Data Protection Regulation (GDPR) has extraterritorial applicability. This means that any organization, regardless of its location, is subject to GDPR if it processes the personal data of individuals located in the European Union, or offers goods or services to them.

This requirement is significant for global businesses since it mandates adherence to strict data protection principles, ensuring that the rights of EU citizens are respected even by companies outside the EU. Failure to comply with GDPR can result in heavy penalties, fostering a culture of privacy and security in data handling practices worldwide.

The other options do not accurately reflect the obligations set forth by GDPR, as the regulation explicitly aims to protect the privacy of individuals in the EU, extending its reach beyond geographical boundaries. Therefore, businesses must consider their operations and customer base in relation to GDPR compliance to avoid legal repercussions.