EU and US agree outline of new data transfer pact

The European Union and the US announced a preliminary data transfer deal on Friday, seeking to end the limbo in which thousands of companies found themselves after Europe’s top court threw out two previous such pacts due to concerns about US surveillance.

While businesses cheered the news, Austrian privacy activist Max Schrems, whose campaign about the risk of US intelligence agencies accessing Europeans' data in a long-running dispute with Meta led to the court vetoes, criticised the lack of details.

US president Joe Biden and European Commission president Ursula von der Leyen said at a joint news conference in Brussels that the provisional agreement took into account the court's concerns and offered stronger legal protections.

“Today, we’ve agreed to unprecedented protections for data privacy and security for citizens,” Mr Biden said. “I am very pleased that we have found an agreement in principle on a new framework for transatlantic data flows,” Ms von der Leyen said. “This will enable predictable and trustworthy data flows between the EU and US, safeguarding privacy and civil liberties,” she added, without elaborating.

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Final deal

An EU official familiar with the matter said it would likely take months to turn the provisional agreement into a final legal deal.

“First, the US needs to prepare their executive order, and then we need to do our internal consultation in the [European] Commission and within the European Data Protection Board,” the official said, referring to the EU privacy watchdog.

Companies and representative groups welcomed the provisional deal.

Business group Ibec’s head of digital economy policy Erik O’Donovan said the development was positive and represented “a welcome political signal”.

“We continue to encourage the EU and US in their ongoing efforts to finalise a revised and resilient framework addressing privacy issues and the needs of modern digitalised business, big and small,” Mr O’Donovan said.

Ibec pointed to research showing 90 per cent of EU-based companies from all economic sectors transfer data outside Europe, often to multiple countries. These transfers are predominantly used for business-to-business purposes, it said, estimating that more than 248,000 people are employed in digitally intensive sectors in the Republic.

Activist Mr Schrems, however, responded to the latest development by saying that the lack of details was troubling and that if the US was only offering executive reassurances instead of changing its surveillance laws, he would not hesitate to go to court again. “The final text will need more time, once this arrives we will analyse it in depth, together with our US legal experts. If it is not in line with EU law, we or another group will likely challenge it,” he said in a statement. – Reuters