US and EU reach breakthrough in data protection dispute

The US and EU have hailed a breakthrough in an ongoing battle over data protection standards, during a visit by President Joe Biden to Europe to build transatlantic unity over the Russian invasion of Ukraine.

For years the transfer of European citizens’ data to the US has been a topic of contention particularly in the light of allegations about US intelligence agencies accessing foreign persons’ data.

But the Russian invasion of Ukraine appears to have reset discussions between Washington and Brussels.

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In a joint announcement on Friday morning, Mr Biden and Ursula von der Leyen, president of the European Commission, said they had “found an agreement in principle on a new framework for transatlantic data flows”.

“This is another step in strengthening our partnership,” said Ms von der Leyen.

The announcement was made as the two powers agreed a new partnership that would reduce Europe’s dependence on energy supplied by Russia.

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President Biden alleged this dependence was being exploited by Russian President Vladimir Putin to “coerce and manipulate his neighbours” and that the funds it provided were used to “drive his war machine”.

Politico, which reported on the looming data breakthrough before the announcement, said several EU and US officials dismissed the link between the agreement and the invasion of Ukraine.

One of the officials stressed “the fundamental problems of getting a deal done don’t go away because of the war in Ukraine”.

What is the issue?

Court cases (notably two led by Austrian activist Max Schrems) have found the American and European data protection regimes to be incompatible, with a particular complaint being the alleged mass surveillance conducted by the US security services as described in the revelations by former National Security Agency contractor Edward Snowden.

The issue is whether European citizens who believe their data has been improperly accessed by the American intelligence services have a legitimate route to bring a legal challenge.

A previous agreement to facilitate these transfers was invalidated in 2020. While enforcement around this ban has not been consistent across the bloc, it has been increasing.

Responding to the news, Caitlin Fennessy of the International Association of Privacy Professionals, said that people working in data protection “can finally exhale”.

“They have been holding their breath for months given the lack of water-tight data transfer compliance options, the borderless nature of internet-based services and escalating enforcement,” she said.

“While we have yet to see the details, it seems both sides were working toward a lasting solution. If they wanted a temporary fix, they could have wrapped up talks months ago. Time will tell whether they got there.”

With concern growing about the global internet fragmenting, this agreement will help keep people connected and services running. It will provide invaluable certainty for American & European companies of all sizes, including Meta, who rely on transferring data quickly and safely. https://t.co/KYfqUM9XbH

The move was also welcomed by Nick Clegg, the president of global affairs at Meta, whose advertising business is dependent on collecting an enormous amount of data.

Sir Nick tweeted: “With concern growing about the global internet fragmenting, this agreement will help keep people connected and services running.

“It will provide invaluable certainty for American and European companies of all sizes, including Meta, who rely on transferring data quickly and safely.”

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