Personal data : the european court invalidate an agreement between the EU and the USA

The Court of justice of the EU considers that the monitoring programs of u.s. pose a risk to the protection of data.

The european court has invalidated on Thursday, a crucial mechanism for the transfer of personal data between the european Union and the United States - the "Privacy Shield" - because of the risk posed by the surveillance programs of americans on the protection of these data.

This decision has been welcomed as a victory by the lawyer, austrian Max Schrems, the figure of the struggle for the protection of data, which was at the origin of the case via a complaint against Facebook. "After a first reading of the judgement on the 'Privacy Shield', it seems that we have won 100% - for our privacy," wrote on Twitter the one that was known already to cancel it in 2015, a similar agreement between the EU and the United States.

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"The United States should engage in a serious reform of the monitoring to return to a status of 'privileged' for american companies," allowing them to transfer data, he added.

The Court of justice of the EU (CJEU) considers in its judgment that the "Privacy Shield" makes it "possible interference in the fundamental rights of persons whose data are transferred" to the United States, because the public authorities in the united states can have access to it, without it being limited to what is strictly necessary".

"This decision creates legal uncertainty for the thousands of small and large businesses of the two sides of the Atlantic that rely on the 'Privacy Shield' for their daily transfers of business data," responded Alexandre Roure, of the ICC, the lobby of the giants of the tech to Brussels. "We hope that policy makers in europe and the u.s. will develop a sustainable solution, consistent with the european law, to ensure the continuation of the flow of data," he added.

Disclaimer for Brussels

The CJEU has, however, considered another valid mechanism allowing the transfer of data from the EU to the rest of the world : the "conditions of contract" type, a model contract defined by the european Commission, that any business can use to export data, for example to a subsidiary, its parent company or a third party. The companies affected by the decision on the "Privacy Shield" should refer on this mechanism.

The european commissioner for Justice, Didier Reynders, had assured before the decision that the Commission had already anticipated several "scenarios". "Based on the content of the decision, we will see what tools are - already-prepared - to-use for both consolidating the fundamental rights and verify that the protection given by the EU to travel with the data," he explained. "The ambition is to react together (...) on the european side as the american side," he assured.

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The personal data involved (online behavior, geolocation, etc) constitute the "gold mine" of the digital economy, in particular for the giants as Google, Facebook or Amazon. But a company which transfers data from one country to another between its subsidiaries, for example to manage the payroll of its employees, is also concerned. The invalidation of the "Privacy Shield", is a new disclaimer to Brussels after the cancellation Wednesday of his decision requiring Apple for the refund of 13 billion euros, until then considered to be undue tax advantages.

the origin of the case : a complaint by Max Schrems with the regulator, irish, demanding the interruption of the flow of data between the european headquarters of Facebook, in Ireland, and its parent company in California. Reason : once in the United States, its data are less protected, because they can be claimed by intelligence agencies, such as the NSA or the FBI, without recourse, or control, as demonstrated by the revelations of the whistleblower Edward Snowden. The CJEU has chosen to go in his direction.

The United States is "deeply disappointed"

Shortly after the decision of the european court invalidating the mechanism for the transfer of personal data, the United States are said to be "deeply disappointed", in a press release of the ministry of Commerce on Thursday.

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Washington will continue to work with the european commission, and is studying the court decision in detail to understand all the practical effects, said Wilbur Ross, the us Commerce secretary. We "hope to be able to limit the negative consequences for the economic relationship, transatlantic, which weighs 7 to $ 100 billion, and that is vital for our citizens, businesses and government respective",he added.

Date Of Update: 17 July 2020, 21:58