Safe Harbor

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A ruling by the EU’s top court invalidates the key mechanism for transferring personal data from the EU to the US and imposes additional conditions for use of the standard contractual clauses.

By Gail E. Crawford, Fiona M. Maclean, Michael H. Rubin, Ulrich Wuermeling, Calum Docherty, and Amy Smyth

On 16 July 2020, the Court of Justice of the European Union (CJEU) invalidated the EU-US Privacy Shield, one of the key mechanisms for lawfully transferring personal data from the European Union to the United States. At the same time, the CJEU ruled that the standard contractual clauses (Model Clauses) remain valid but can only be used under strict conditions.

This post provides an initial analysis of the judgment and proposes some immediate next steps for businesses to ensure compliant data transfers from the EU.

By Gail Crawford and Calum Docherty

On October 3, 2017, the Irish High Court announced that it will make a reference to the Court of Justice of the European Union (CJEU) for a preliminary ruling on the validity of the Standard Contractual Clauses, which allow companies in the European Economic Area (EEA) to transfer personal data outside of the EEA. In doing so, the Irish High Court acknowledged that, “there are well founded grounds for believing that the [Standard Contractual Clauses] are invalid,” but clarified that this was a question of EU law for the CJEU to decide.

What happened in the case?

Maximillian Schrems (an Austrian privacy campaigner who, in 2015, led a case that struck down the EU-US Privacy Shield’s forerunner, Safe Harbor) has a Facebook account. Schrems complained to the Irish Data Protection Commissioner (DPC) that Facebook Ireland Limited (Facebook Ireland) transferred his data to its US-parent, Facebook Inc. (Facebook US) for further processing.

In order to transfer personal data to a third country outside of the EEA, that third country (in this case, the US) should offer guarantees ensuring an adequate level of protection for personal data essentially equivalent to the level of protection ensured within the EEA. The European Commission (EC) has not considered the US to provide this adequate level of protection for personal data, so companies that wish to transfer data must rely on other data transfer mechanisms, including the Standard Contractual Clauses.

Speakers: Gail Crawford, Jennifer Archie, Ulrich Wuermeling

On October 6, 2015, the European Court of Justice invalidated the EU Commission’s decision that had allowed companies to transfer personal data from the EU to the United States under the EU-US Safe Harbor Framework. Two months on, various bodies and EU privacy regulators have issued guidance, including a statement by the Article 29 Working Party effectively making clear that there will be a grace period in enforcement concluding at the…

By Brian Meenagh

On October 26, 2015, Raja Al Mazrouei, the Commissioner for Data Protection for the Dubai International Financial Centre (the DIFC), issued guidance on the adequacy of US Safe Harbor for the purpose of exporting personal data from the DIFC. The guidance is significant for organisations that transfer personal data from the DIFC to the US and such organisations should urgently review the basis upon which they transfer personal data from the DIFC to the US to ensure that they continue to comply with the DIFC Data Protection Law (No 1 of 2007).

The guidance follows the decision of the European Court of Justice (the ECJ) in Case C-362/14 – Maximillian Schrems v Data Protection Commissioner that Decision 2000/520 of the European Commission, which stated that Safe Harbor-certified US companies provide adequate protection for personal data transferred to them from the EU (the Safe Harbor Adequacy Decision), is invalid.

The key message from the guidance is that:

“the invalidation of the Adequacy Decision by the ECJ provides cause for the Commissioner to reconsider the adequacy status previously afforded under the Law to US Safe Harbor Recipients. However, the Commissioner also understands that there are ongoing negotiations between Europe and US authorities towards an improved Safe Harbor framework and that these negotiations are well advanced.

iStock_Lock.jpgThe German Government does not see any need for them to take action with regard to the US-American “Safe Harbor” framework which has become subject to growing criticism. In a response to a query made by the SPD parliamentary group dated 25 October 2010 the Government refers the issue to the European Commission and the supervisory authorities of the German States. Following a study (“The US Safe Harbor – Fact or Fiction?”) by Chris Connolly (data privacy and…