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EU-US Data Transfer Pact - Update

by Maygen Jacques

4 August 2020 14:22pm

You may have heard that the EU Court struck down the EU-US Data Transfer Pact. This was a huge step for data privacy. It was lead by activists supporting privacy rights to countries who have much less stringent laws.

A complaint was filed against Facebook by a lawyer in Australia who experienced a violation of his privacy rights when his personal information was transferred to the US.

The EU court blasted the EU-US agreement out the water. Previously, it allowed for companies to transfer data from and between the EU and US. This caused a lot of tension for organisations like HubSpot and Marketo who needed this agreement to remain in place to allow for the flow of digital data globally.

The ECJ (European Court of Justice) that this law, called the Privacy Sheild, was not in compliance with European privacy rights. It was compiled only 4 years ago to allow free movement of data between the EU and US.

Over 5000 companies used this system.

This decision came as the latest in a lengthy fight lead by the privacy rights activists who desperately wanted change that prevents a company from transferring any personal data to countries with less stringent protection laws. These efforts were catalysed in 2013 thanks to the work of Edward Snowden, an ex-US intelligence officer revealed US governmental monitoring was happening over forms of electronic communications stemming from private businesses.

The totality of this decision from the court and it impacts is not immediately obvious as it's caused somewhat of a cluster of confusion around how the affected companies will need to work to comply with the law. Some will experience a sharp disruption. The European court somewhat shrouded their intentions by stipulating the changes were to protect the current way of working. EU-US officials must now seek a new compromise on how we move

The ruling affects big tech companies like Facebook and Google, as well as thousands of other multinational businesses. Lawyers said the data subject to transfer rules could include communications like emails and social media posts, financial records, business files, human resources materials about employees, marketing databases and customer records.

Those businesses affected are calling for a grace period to adjust to the new legal implications regarding moving of data. It cuts off a source of data into the States. Essentially, this decision demands immediate action.

There are alternatives to US-based systems, so don't worry if you're using one. You should act quickly, though. We wrote more on this matter here, so read on.


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