Compliance trends in 2021 proved that the landscape remains uncertain, demanding more attention during the onboarding and maintenance phases.

While buyers are not necessarily obligated to exercise every conceivable measure to investigate a vendor’s practices, there are tactics outside of calls and questionnaires for vetting a data source.

The App Annie settlement was no doubt a shock, but we prefer to take a measured view of its impact and pragmatic significance for data buyers. For now, we believe (based on the SEC’s statements) that the settlement reflects outlier vendor behavior, since remedied, and in fact supports the diligence and contracting measures long practiced by sophisticated buyers.

China is very much in focus again this month as buyers react to the recent enforcement activity of the Cyberspace Administration and Ministry of Industry and Information Technology.

The widespread practice of forming customer profiles represents an enormous potential market for alternative data, but also presents new compliance challenges deeply rooted in privacy that may hinder conventional buysiders and corporates alike.

We are concerned that the answer may now be "yes," given the recent spike in data localisation actions this summer.

As with diligence in other contexts, it's not a good idea to assume that competitors have done their homework, or that the risks applicable to your business are the same.

Alternative data platforms represent an increasingly common source of data, as entrenched market participants such as Bloomberg acquire smaller vendors or rights to redistribute their data. Regardless of the differences in business models across platforms (e.g., AWS, Bloomberg, FactSet, etc.), each platform represents a challenge for buyside compliance teams, given the open-ended nature of the data these platforms provide. This challenge is likely to grow as data providers consolidate proven data.

Generally, two kinds of vendors refuse to respond to DDQs: entrenched vendors and new entrants that are unfamiliar with buy-side regulatory requirements.

This is an almost universal problem for legal and compliance teams. Fortunately, there are several levers to pull.