A cloud of uncertainty hangs over international data transfers

Yesterday, the Court of Justice of the European Union (CJEU) invalidated the Privacy Shield, an international personal data transfer mechanism between the EU-US, while ruling on the landmark "Schrems II" case.

BusinessEurope Director General Markus J. Beyrer said: "This is a blow for the whole trans-Atlantic trade. It could hurt many European companies as they continue to struggle with the COVID crisis. We cannot push a big part of transatlantic trade in limbo from one day to the other, mostly all trade is bound to the transfer of data."

Europe’s highest court also ruled that another transfer mechanism used for international personal data transfers, standard contractual clauses, was valid. However, national data protection authorities should strictly ensure that the 3rd country they are being used with is adhering to EU privacy standards. Demonstrating that with the USA, at least, hangs in the balance.

BusinessEurope Director General Markus J. Beyrer went on to explain: "The EU and the USA should sit down constructively and look for a solution. At the same time, we need to find an intermediate solution for companies, either a formal moratorium or non-application of penalties. We need a rapid solution to avoid a negative impact for the European economy at this very wrong moment and we expect that responsible authorities act pragmatically."