EU and US reach agreement on Privacy Shield replacement

The European Union and the US government have reached an agreement, in principle, on a deal for transatlantic data flows.

A new agreement potentially signals an end to years of legal uncertainty that has hung over the US, particularly its tech industry, since the EU-US Privacy Shield mechanism was invalidated in a 2020 court ruling.

EU president Ursula von der Leyen revealed the proposed deal during a joint briefing with US president Joe Biden, who is in Europe mainly to discuss the Russian invasion of Ukraine. Von der Leyen gave special thanks to EU justice commissioner Didier Reynders and US secretary of commerce Gina Raimondo for their efforts in finding an effective solution. However, the exact details of the agreement, specifically what each party has agreed to, have not been clearly explained.

"I am very pleased that we have found an agreement in principle on a new framework for transatlantic data flows," said von der Leyen. "This will enable predictable and trustworthy data flows between the EU and US, safeguarding privacy and civil liberties."

Privacy Shield was deemed incompatible with the EU's data protection laws, largely due to the American government's own regulations for surveillance. A European Court of Justice ruling in 2020 found the act was unable to uphold the levels of privacy that data subjects in Europe are legally entitled to.

"We managed to balance security and the right to privacy and data protection," von der Leyen suggested during the briefing.

However, some have criticised what's seen as an impossible task of reconciling two different data protection approaches, particularly as the US has yet to enact a federal data protection policy.

In response, Max Schrems, the privacy lawyer and campaigner behind the Schrems I and Schrems II legal cases, took to Twitter to question the weight of the deal.

"Seems we do another Privacy Shield especially in one respect: Politics over law and fundamental rights," he tweeted. "This failed twice before. What we heard is another 'patchwork' approach but no substantial reform on the US side. Let's wait for a text but my bet is it will fail again."