Costly bureaucracy

Business Fears Over Privacy Law

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The new E.U. data privacy proposals are getting a thumbs down from Facebook and businesses.
  • Why it matters

    Why it matters

    In drafting the new proposals, the E.U. is struggling to balance the demands of data privacy activists, who form a strong lobby in Europe, with the added burden on businesses.

  • Facts

    Facts

    • The E.U. is currently reforming its data protection rules, including introducing bloc-wide regulations.
    • Its aim is to “give citizens back control over of their personal data, and to simplify the regulatory environment for business.”
    • The German Federal Statistical Office estimates that the bureaucratic costs to German businesses alone will be €1 billion ($1.12 billion).
  • Audio

    Audio

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Few people question the E.U.’s intention to introduce a new law that regulates and standardizes the processing of personal data with the entire bloc.

Companies applaud the effort to condense the separate national data protection laws of the E.U.’s 28 members, many of them highly complex, into a single piece of legislation. In fact, the harmonization will likely save businesses that operate in more than one country time and money.

But that is where the enthusiasm for the new policy ends.

Many in the business world question the promises being made by the authors of the planned directive, who are members of the European Parliament and European Commission, the E.U.’s executive arm. They question whether the binding new rules will truly help to halt the domination of U.S. data giants such as Facebook and Google, or if they will finally provide the European digital economy with the level playing field it needs to catch up with foreign competitors.

American firms will have to play by the new rules if they are to operate in Europe, said Oliver Süme, head of the Association of the German Internet Industry. “However, U.S. providers will still be able to compete globally under significantly more flexible and innovation-friendly conditions with their digital business models,” he added.

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