US and Europe deadlock over Safe Harbour a digital debacle for internet users

2 Feb 201633 Shares

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Unless an agreement is reached, the collapse of the free flow of data could impact internet users on both sides of the Atlantic

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US and EU negotiators are still deadlocked in Safe Harbour negotiations after the 31 January deadline has passed.

Unless an agreement is reached, the collapse of the free flow of data could impact internet users, as the cost of data storage on both sides of the Atlantic could go up.

It is now four months since the European Court of Justice deemed the Safe Harbour pact invalid, thrusting US data and tech companies into legal limbo.

The treacherous legal waters of uncertainty could impact the operations of internet giants like Google, Microsoft, Facebook, Twitter and LinkedIn, all of whom have international headquarters, as well as data centres, in Ireland.

Europe’s various data protection chiefs will now meet to finalise how they believe data can be transferred from one side of the Atlantic and will publish their judgment tomorrow (3 February).

‘For tech businesses and consumers throughout the world, the collapse of the free flow of data across the Atlantic would be a disaster’
– MIKE WESTON, PROFUSION

Talks on Sunday are understood to have stalled over the issues of how Europeans’ data will be protected from surveillance by the US government and how Europeans can seek remedies in US courts.

With no alternative to Safe Harbour in place, the situation puts the entire internet industry, including nine out of the top 10 born-on-the-internet companies with headquarters in Ireland, in an uncertain place.

Crux of the matter is the right to privacy

Last October, the European Court of Justice declared the long-standing Safe Harbour framework invalid following a case taken by Austrian privacy campaigner Max Schrems.

In fact, the lack of a timely agreement on a new Safe Harbour agreement could be a watershed moment for the global tech community, says Mike Weston, CEO of data science consultancy Profusion

“The reality is that the US and Europe have completely different positions on an individual’s right to privacy online. In Europe, with the exception of the UK, the direction of travel has been towards increasing data protection. Whereas, in the US, with the passage of the Cybersecurity Information Sharing Act, the Government’s position is the polar opposite.”

Weston says that, unless there is a huge change in policy on one side of the Atlantic, agreements like Safe Harbour are doomed to failure.

He said it is also worth noting that the US Department of Justice’s (DoJ) case against Microsoft concerning gaining access to information held in a data centre in Ireland, is due to be decided soon. If the DoJ is successful, there is a real risk that the breach between the US and EU will become permanent.

“For tech businesses and consumers throughout the world, the collapse of the free flow of data across the Atlantic would be a disaster,” Weston warned.

“Costs will go up as companies increase data storage throughout Europe, smaller companies will find it much harder to grow globally and, consequently, innovation will be severely curtailed. The net result for the man or woman in the street will be more expensive online services and less choice.”

US-EU flags image via Shutterstock

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Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com