World Economy

EU, US in ‘Privacy Shield’ Deal

EU, US in ‘Privacy Shield’ DealEU, US in ‘Privacy Shield’ Deal

The European Union and the US reached a new deal to facilitate trans-Atlantic data transfers, in a last-minute agreement designed to safeguard privacy and protect technology giants and multinationals from being plunged into legal limbo.

The EU said the new pact—called the EU-US privacy shield—will provide citizens with robust privacy protection and the right to judicial review. Negotiators made the breakthrough Tuesday as national regulators threatened to impose tight restrictions on how firms move information across the Atlantic, Bloomberg reported.

“We have for the first time received detailed, written assurances from the United States on the safeguards and limitations applicable to US surveillance programs,” Andrus Ansip, a European Commission vice-president, told reporters at the EU Parliament in Strasbourg, France. “The US side has clarified that they do not carry out indiscriminate mass surveillance of Europeans.”

The two sides were forced back to the drawing board after the EU’s top court said in October a “safe-harbor” accord dating back to 2000 failed to offer safeguards to EU citizens when US-based companies such as social media giant Facebook Inc. process personal data on customers, from billing information to the content of messages. The new deal seeks to address concerns that American spies had unfettered access to private data on European citizens.

  Paris Terror

After the the tragedy in Paris, some US officials had hoped the EU would tone down its demands, according to people familiar with the talks. But rather than backtrack, EU Justice Commissioner Vera Jourova continued to press for better privacy protection—arguing that the mass data collection revealed by former US security operative Edward Snowden is pointless in the war against terror.

“For the first time, the US has given the EU binding assurances that the access of public authorities for law enforcement and national security will be subject to clear limitations,” Jourova said Tuesday.

Among the commitments will be the creation of a special ombudsman in the US state department “who would follow up on complaints and inquiries by individuals about data access,” Ansip said. Still, privacy campaigners, lawyers and trade groups were split over whether the new deal would be an improvement over the banned safe-harbor pact.

  Digital Economy

The deal “will allow the digital economy in both the EU and the US to grow, which is so critical,” US Commerce Secretary Penny Pritzker said on a conference call.

Under the terms of the new deal, the two sides pledged to jointly review the new mechanism every year. The Brussels-based commission and the US Department of Commerce will also monitor how the system works, together with national security experts and European data protection watchdogs.

After the court ruling, the EU demanded reassurances about spies’ access to data and a pledge from US authorities to follow up on complaints.