US throws down the gauntlet over e-privacy

The US departments of Treasury and Commerce have written to the European Commission (EC) complaining that the so-called ‘Safe Harbour’ agreement to ensure US companies comply with EC privacy laws is ‘unduly burdensome’. They want to delay its introduction.

Jonathan Armstrong, an associate at legal firm Eversheds, thinks the move could harm transatlantic ebusiness.

‘A lot of US companies complain heavily about EC data protection legislation,’ he said. ‘There is political momentum to prevent US companies being disadvantaged by EC laws. The US would be prepared to push pretty hard. It could be embodied into a whole new trade war.’

Safe Harbour was set up in March 2000 to exempt US companies from the EC privacy directive which prevents them exporting data about European citizens. The US is now objecting to the use of ‘standard’ contracts that it claims exceed the original agreement.

The new US administration thinks that former president Clinton allowed the EC to impose too many rules on US companies, said Jeffrey Mann, vice president at analyst Meta Group.

‘There are troublemakers in Congress. But all Safe Harbour is saying is that US companies doing business in Europe have to follow European laws,’ he said.

This article will appear in the 29 March issue of Computing

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