As of, August 1st, 2016, U.S. companies can now join the Safe Harbor successor EU-U.S. Privacy Shield (the “Privacy Shield”) for personal data transfers from the EU to the U.S.
This post gives a high level summary of what companies should consider with the Privacy Shield.
On July 12, 2016, the European Commission (the “Commission”) formally adopted the adequacy decision necessary to implement the Privacy Shield. This means that transfers of personal data from the EU to the U.S. that are made pursuant to the Privacy Shield’s requirements are lawful under EU law. The Privacy Shield replaces the EU-U.S. Safe Harbor Framework, which was invalidated by the Court of Justice of the European Union (“CJEU”) on October 6, 2015.
After receiving the approval of the EU Member States, through the Article 31 Committee, last Friday, the European Commission has today, July 12th, 2016, formally adopted the Adequacy Decision necessary to implement the EU-U.S. Privacy Shield (the Decision).
The Decision will be notified to Member States today and, as such, will be effective immediately.
The adoption process had stalled in recent months due to ongoing concerns about the access to personal data by public authorities in the U.S. You can read about some of these concerns in our previous blog post.
The European Commission has received further commitments from the U.S. and has agreed clarifications and improvements on the bulk collection of data, strengthening the Ombudsperson mechanism and more explicit obligations on companies as regards limits on retention and onward transfers. Those commitments and clarifications have been sufficient to allay the EU member states, at least for now.
The Privacy Shield is subject to an annual review mechanism.
Today the EU-U.S. Privacy Shield was approved by the EU Member States, which sets the stage for the European Commission to grant final approval to the Privacy Shield as a basis for EU-U.S. transfers of personal data.
This development follows criticisms of the Privacy Shield this past April from the Article 29 Working Party, an advisory group comprised of the EU privacy regulators. We summarized the primary criticisms in a prior blog post. The Working Party was responding to the draft adequacy decision that was released by the European Commission on February 29, 2016, which we summarized here. The revisions to the Privacy Shield are intended to address the criticisms of the Working Party but it is not yet clear if the criticisms have been fully reflected.
While EU regulators determine whether to adopt a new agreement for transfers of personal data from Europe to the United States to replace the invalid EU-U.S. Safe Harbor Framework, German data protection authorities have not been idly twiddling their thumbs.
Hamburg’s data protection commissioner, the head of one of 16 Federal German data protection authorities (“DPA”), announced in February that his agency is investigating Hamburg-based subsidiaries of large U.S. companies engaging in transfers of personal data of EU citizens to the U.S.
On 29 February 2016 the European Commission issued the legal texts of the EU-U.S Privacy Shield which aims to replace the defunct EU-U.S Safe Harbor Framework as a legitimate mechanism for transferring personal data from the EU to the U.S.
In contrast to its predecessor, the Privacy Shield contains commitments from US government in relation to controls on access to personal data by public authorities. This is an aspect of the new scheme which aims to address the jurisprudence of the Court of Justice of the European Union and criticisms of the previous Safe Harbor Framework.