Data privacy

No Sign of a Safe Harbor

A veritable data wall is going up between the U.S. and E.U.
  • Why it matters

    Why it matters

    The Safe Harbour agreement dictated how U.S. companies had to comply with privacy laws for protecting European citizens’ data. It expires on Monday, and there is no new agreement in sight.

  • Facts


    • In October 2015, Europe’s top court invalidated the Safe Harbour.
    • European Union data watchdogs had criticized the agreement for lack of control and insecure from U.S. spies and IT snoops.
    • Beginning next month companies that transfer data based on Safe Harbor could be fined up to €300,000, or about $330,000.
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Four months after “Safe Harbor” was declared illegal, the deadline for reaching a new data transfer deal between Europe and the United States will likely pass next week with no solution.

During the transition period, companies operating in Europe were still allowed to transfer personal information and save it in U.S. data centers. But as the January 31 deadline looms, many firms that cooperate with U.S. service providers could face hefty penalties, including some German companies.

Big questions must be answered before an agreement can be reached. Is the Internet a borderless place? Who decides the data quid pro quo between companies and their customers? Representatives from the E.U.’s 28 national agencies that deal with data protection must come to an agreement Tuesday, or risk sinking tens of thousands of companies into a legal quagmire.

Even ahead of the agreement’s expiration, companies that invoke Safe Harbour are already coming under pressure. Sabre, a leading U.S.-based travel-booking network, is used by nearly a quarter of travel agents throughout Germany to book thousands of flights, cruises, hotel reservations and car rentals. The problem is, once a reservation is booked, the personal information of German customers can end up in a data center in Texas.

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