#PrivacyShield: ‘Especially relevant with new US administration’

The European Commission has published (19 October) its first annual report on the functioning of the EU- US Privacy Shield, the aim of which is to protect the personal data of anyone in the EU transferred to companies in the US for commercial purposes.

When it launched the Privacy Shield in August 2016, the Commission committed to reviewing the Privacy Shield on an annual basis, to assess if it continues to ensure an adequate level of protection for personal data. Today's report is based on meetings with all relevant US authorities, which took place in Washington mid-September 2017, as well as input from a wide range of stakeholders (including reports from companies and NGOs). Independent data protection authorities from EU member states also participated in the review.

The Privacy Shield is the successor to the 2000 Safe Harbour decision, which was invalidated by an EU Court of Justice ruling of 6 October 2015 (Schrems case). The EU Commission responded by negotiating the new Privacy Shield arrangement to ensure “adequate” protection of personal data transferred and stored by companies in the US.

Overall the report claims that the Privacy Shield continues to ensure an adequate level of protection for the personal data transferred from the EU to participating companies in the US. The US authorities have put in place the necessary structures and procedures to ensure the correct functioning of the Privacy Shield, such as new redress possibilities for EU individuals. The European Commission say that the certification process is functioning well – with more than 2,400 companies now been certified by the US Department of Commerce.

Justice, Consumers and Gender Equality Commissioner Věra Jourová said: "Transatlantic data transfers are essential for our economy, but the fundamental right to data protection must be ensured also when personal data leaves the EU. Our first review shows that the Privacy Shield works well, but there is some room for improving its implementation. The Privacy Shield is not a document lying in a drawer. It's a living arrangement that both the EU and U.S. must actively monitor to ensure we keep guard over our high data protection standards."

Commission recommendations to further improve the functioning of the Privacy Shield

The report suggests a number of recommendations to ensure the continued successful functioning of the Privacy Shield. These include:

More proactive and regular monitoring of companies' compliance with their Privacy Shield obligations by the US Department of Commerce. The US Department of Commerce should also conduct regular searches for companies making false claims about their participation in the Privacy Shield.

More awareness-raising for EU individuals about how to exercise their rights under the Privacy Shield, notably on how to lodge complaints.

Closer cooperation between privacy enforcers i.e. the U.S. Department of Commerce, the Federal Trade Commission, and the EU Data Protection Authorities (DPAs), notably to develop guidance for companies and enforcers.

Enshrining the protection for non-Americans offered by Presidential Policy Directive 28 (PPD-28), as part of the ongoing debate in the US on the reauthorization and reform of Section 702 of the Foreign Intelligence Surveillance Act (FISA).

To appoint as soon as possible a permanent Privacy Shield Ombudsperson, as well as ensuring the empty posts are filled on the Privacy and Civil Liberties Oversight Board (PCLOB).

Next Steps

The report will be sent to the European Parliament, the Council, the Article 29 Working Party of Data Protection Authorities and to the US authorities. The Commission will work with the US authorities on the follow-up of its recommendations in the coming months. The Commission will continue to closely monitor the functioning of Privacy Shield framework, including the U.S. authorities' compliance with their commitments.

Background

The EU-US Privacy Shield decision was adopted on 12 July 2016 and the Privacy Shield framework became operational on 1 August 2016. This framework protects the fundamental rights of anyone in the EU whose personal data is transferred to the United States for commercial purposes as well as bringing legal clarity for businesses relying on transatlantic data transfers.

For instance when shopping online or using social media in the EU, personal data may be collected in the EU by a branch or business partner of a participating American company, who then transfers it to the US. For example, a travel agent in the EU may send names, contact details and credit card numbers to a hotel in the US which has registered to the Privacy Shield.

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