EU–US Privacy Shield

In October 2015 the European Court of Justice declared the previous framework called the International Safe Harbor Privacy Principles invalid.[3] Soon after this decision the European Commission and the U.S. Government started talks about a new framework and on February 2, 2016 they reached a political agreement.[1] The European Commission published the "adequacy decision" draft, declaring principles to be equivalent to the protections offered by EU law.[4]

The Article 29 Data Protection Working Party delivered an opinion on April 13, 2016, stating that the Privacy Shield offers major improvements compared to the Safe Harbor decisions, but that three major points of concern still remain. They relate to deletion of data, collection of massive amounts of data, and clarification of the new Ombudsperson mechanism.[5] The European Data Protection Supervisor issued an opinion on 30 May 2016 in which he stated that "the Privacy Shield, as it stands, is not robust enough to withstand future legal scrutiny before the [European] Court".[6]

On 8 July 2016 EU Member States representatives (article 31 committee) approved the final version of the EU-U.S. Privacy Shield, paving the way for the adoption of the decision by the Commission.[7] The European Commission adopted the framework on 12 July 2016 and it went into effect the same day.[8][9]

U.S. President Donald Trump signed an Executive Order entitled "Enhancing Public Safety" which states that U.S. privacy protections will not be extended beyond US citizens or residents:

Agencies shall, to the extent consistent with applicable law, ensure that their privacy policies exclude persons who are not United States citizens or lawful permanent residents from the protections of the Privacy Act regarding personally identifiable information.[10]

The European Commission has stated that:

The US Privacy Act has never offered data protection rights to Europeans. The Commission negotiated two additional instruments to ensure that EU citizens’ data is duly protected when transferred to the US:

• The EU–U.S. Privacy Shield, which does not rely on the protections under the US Privacy Act.
• The EU–US Umbrella Agreement, which enters into force on 1 February (2017). To finalize this agreement, the US Congress adopted a new law in 2017, the US Judicial Redress Act,[11] which extends the benefits of the US Privacy Act to Europeans and gives them access to US courts."[12]

The Commission said it will "continue to monitor the implementation of both instruments".[12]

German MEP Jan Philipp Albrecht and campaigner Max Schrems criticized the new ruling, with the latter predicting that the Commission might be taking a "round-trip to Luxembourg" (where the European Court of Justice (CJEU) is located).[13] Many Europeans demanded a mechanism for individual European citizens to lodge complaints over the use of their data, as well as a transparency scheme to assure that European citizens' data does not fall into the hands of U.S intelligence agencies.[14]

The Privacy Shield has been challenged legally by privacy groups.[15][16] As of November 2016, it is not clear whether the cases will be considered admissible.[17][18]

As of February 2017 the future of the Privacy Shield is contested. One consultant, Matt Allison, predicts that "The EU's citizen-driven, regulated model will swiftly come into conflict with the market forces of the US and the UK."[19] Allison summarizes a new paper in which the European Commission lays out its plans for adequacy decisions and global strategy.[20]

As of December 2019, an opinion has been published that may influence the CJEU decision. It outlines various scenarios that may result from the conflict in regimes. The author concludes that the opinion "should generate equal measures of relief and alarm for the U.S. government and for companies dependent on data transfers. A final judgment from the CJEU, which may or may not follow the advocate general’s recommendations, is expected in a few months." [21]

A final CJEU decision is expected to be published 16 July 2020.[22] A decision regarding the impact of Brexit on Privacy Shield is expected by 31 December 2020 which may be mooted depending on the CJEU decision.[23]

Switzerland is not an EU member but follows many EU policies through treaty implementations. Accordingly, it has implemented its own version of the Privacy Shield Framework through its own Swiss-US Privacy Shield. It is largely similar to the EU-US Privacy Shield Framework, but implements its own DPA instead of various EU DPAs. It also has no grace period and several other meaningful differences to the definition of "sensitive data," binding arbitration, and changes to privacy policies.[24] The EU-US and Swiss-US programs are adequately similar that they are administered together by the United States.[25]

• Binding corporate rules
• Electronic Communications Privacy Act
• FTC fair information practice (FIPP), US
• IT risk
• Privacy
• Safe harbor (law)
• Stored Communications Act
• General Data Protection Regulation (GDPR)

• Commission Implementing Decision (EU) 2016/1250 of 12 July 2016 on the adequacy of the protection provided by the EU-U.S. Privacy Shield (notified under document C(2016) 4176)
• EU-U.S. Privacy Shield fact sheet at the European Union
• EU-U.S. Privacy Shield press release from the European Commission, with a draft adequacy decision attached, 29 February 2016
• EU-U.S. Privacy Shield fact sheet at the US Department of Commerce