Sen. Schatz Urges Action on Safe Harbor Decision

US Sen. Brian Schatz, file photo by Wendy Osher.

US Sen. Brian Schatz (D-Hawai‘i), ranking member of the Senate Subcommittee on Communications, Technology and the Internet, released a statement in response to today’s European Court of Justice’s decision to invalidate the 15-year-old Safe Harbor agreement, a trans-Atlantic data-transfer pact used by approximately 4,500 companies to transfer personal information about EU residents to US servers without breaching EU data-protection rules.

Companies affected include Apple, Google and other cloud storage companies, because it violates the privacy rights of Europeans by exposing them to “allegedly indiscriminate surveillance by the US government.”

• Although today’s decision doesn’t mean personal data transfers will end immediately, it gives national regulators the right to suspend them if they don’t provide sufficient privacy protections. The burden will shift to national European regulators, and companies will have to use lawyers to set up alternate privacy arrangements and prepare for challenges.

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  News sources report that the invalidation of the pact will jeopardize data traffic within the world’s largest trading relationship.

“The US-EU Safe Harbor framework is an important model for trans-Atlantic data transfers and has been critical in protecting both individual privacy and commerce between the European Union and the United States for the past 15 years,” said Sen. Schatz. “Over 4,000 US companies rely on Safe Harbor to validate the transfer of data from the EU to the US, including both US headquartered companies and US-based subsidiaries of EU-headquartered companies.

“The European Court of Justice’s decision announced this morning invalidates the current Safe Harbor framework; a decision which could be the digital equivalent of grounding all planes and stopping all shipping from Europe to the US overnight,” Sen. Schatz continued. “It is urgent for Secretary Pritzker and Chairwoman Ramirez to work with their European counterparts in the European Commission and the member states to rapidly issue clear guidance on data transfers in light of the court’s decision. Guidance is needed to ensure continuity for businesses and consumers on both sides of the Atlantic until a new agreement is in effect.

“Cross-border data flows between the US and Europe are the highest in the world,” Sen. Schatz stated. “This movement of data is critical to students, families, businesses and promotes employment, free speech, innovation, and cultural expression. While we respect each other’s different legal approaches, we must also work together quickly and effectively to address this impasse in order to reassure European citizens that their personal data will continue to be afforded the highest level of protection when it is transferred to the United States.

“Finally, Congress must do its part to pass bipartisan legislation that will ensure a proper balance between privacy, civil liberties, and national security,” Sen. Schatz concluded. “As the digital economy increases the pace of global integration, conflicts created by different policy approaches will increase. We must therefore lead through action.”