SC-900 Practice Question: Describe the capabilities of Microsoft compliance solutions
Tailspin Toys is a toy manufacturer with headquarters in the US and subsidiaries in Europe and Asia. You are the compliance administrator. The company must comply with the EU General Data Protection Regulation (GDPR). Requirements: 1) Personal data of EU residents must be retained only for as long as necessary (max 5 years after last interaction). 2) If a user tries to share personal data outside the EU, the action must be blocked. 3) Users must be able to manually mark documents as 'GDPR High Risk' which will encrypt them and add a watermark 'GDPR PROTECTED'. 4) All access to personal data must be audited. You have Microsoft Purview with E5 compliance licenses. What is the most efficient solution?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Create an auto-labeling policy to apply a 'Personal Data' sensitivity label; create a retention label 'GDPR Retention' to auto-apply to personal data and retain for 5 years; create a DLP policy to block sharing of labeled personal data outside EU; create a separate sensitivity label 'GDPR High Risk' for manual application with encryption and watermark; enable audit logging
The most efficient because it uses a retention label 'GDPR Retention' with auto-labeling to automatically retain personal data for 5 years, precisely meeting requirement 1. It creates a DLP policy to block sharing of labeled personal data outside the EU, satisfying requirement 2. It provides a separate sensitivity label 'GDPR High Risk' for manual application with encryption and watermark, meeting requirement 3. Audit logging is enabled for requirement 4. Option A uses a retention policy on all content, which is too broad and not specific to personal data. Option C lacks a manual sensitivity label for high-risk documents. Option D attempts to use a single sensitivity label for both automatic and manual scenarios, which is less flexible and may not apply encryption/watermark correctly for manual labeling.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Use a retention policy to delete all content after 5 years; create a DLP policy to block sharing of personal data outside EU; create a sensitivity label for manual application with encryption and watermark; enable audit logging
Why it's wrong here
Retention policy applies to all content, not just personal data; also deletion of all content after 5 years may not be appropriate for non-personal data.
- ✓
Create an auto-labeling policy to apply a 'Personal Data' sensitivity label; create a retention label 'GDPR Retention' to auto-apply to personal data and retain for 5 years; create a DLP policy to block sharing of labeled personal data outside EU; create a separate sensitivity label 'GDPR High Risk' for manual application with encryption and watermark; enable audit logging
Why this is correct
Auto-labeling applies sensitivity label; retention label retains personal data for 5 years; DLP blocks cross-border sharing; manual label provides encryption and watermark; audit logging tracks access.
- ✗
Use a retention policy to delete personal data after 5 years; create a DLP policy to block cross-border sharing; use a sensitivity label with auto-labeling for personal data; enable audit logging
Why it's wrong here
Retention policy cannot specifically target personal data; also manual label for high risk is missing.
- ✗
Create a DLP policy to block sharing of personal data outside EU; use a retention label for 5 years; use a single sensitivity label for both automatic and manual scenarios; enable audit logging
Why it's wrong here
A single sensitivity label cannot be both auto-applied and manually applied with different settings; needs separate labels.
Go deeper
Related to this question
Learn chapter
Compliance Concepts
Key term
DLP
Data Loss Prevention — security technology that detects and prevents unauthorised transmission of sensitive data outside an organisation.
Key term
Compliance
Compliance is the process of ensuring that an organization follows laws, regulations, standards, and internal policies that apply to its operations and data handling.
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JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This SC-900 practice question is part of Courseiva's free Microsoft certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the SC-900 exam.