The Financial Times writes that a clash between European and US rules are “… likely to spark a diplomatic battle between Brussels and Washington, which has actively been trying to water down the EU’s tough new privacy legislation by handing US companies a de facto exemption from it.”
What about the data privacy issues posed by FATCA? Shouldn’t we be hearing more from the EU Justice commissioner about this?
Europe’s most senior justice official is adamant she will fight US attempts to water down a proposed EU data protection and privacy law that would force global technology companies to obey European standards across the world.
Viviane Reding, EU commissioner for justice, said that the EU was determined to respond decisively to any attempts by US lobbyists – many working for large tech groups such as Google and Facebook – to curb the EU data protection law.
“Exempting non-EU companies from our data protection regulation is not on the table. It would mean applying double standards,” Ms Reding told the Financial Times.
“Data protection is a fundamental right in Europe which is clearly enshrined in the Charter of Fundamental Rights. Whilst this may not be the case in other parts of the world, one thing is clear: if companies want to tap into the European market they have to apply European standards.”
Ms Reding’s firm approach is likely to spark a diplomatic battle between Brussels and Washington, which has actively been trying to water down the EU’s tough new privacy legislation by handing US companies a de facto exemption from it.
Washington has repeatedly expressed its concern that the draft legislation could stifle innovation as well as kick-start a trade war between European and US companies…
The FT in the UK has been GROSSLY negligent in its lack of reporting about FATCA. Nothing but the broadest brush fashion. No analysis, no depth – just reporting IRS PR. It was silent during the entire consultation period when the government was finalising its decision to sign the IGA. Very disappointing for a newspaper of its supposed ‘quality’.
Thanks for posting this – very important issue. It is important to recognize that the U.S. is attempting to lower the standards of privacy and human rights in general to the low and (getting lower) standard that exists in the United States. It is essential that Brussels stand strong.
Yes, this is the same thing that they are doing in the FATCA IGAs.
If I didn’t know better, I would say that the goal of the United States is to end human freedom. Orwell, would be proud!
Excellent commentary by Allison Christians on her blog…
US fights EU on data privacy law, says EU should respect US right to regulate
I wonder if the hypocrisy is actually mentioned in these so called negoatiations and the parallel with FATCA comes up.
if I recall, the treasury secretary mentioned that they’re not negotiating with the EU on FATCA, but with respective governments.
I really wish the EU as a whole would look at FATCA from two angles.
Data protection – The UK Data Protection Act has a carve out for tax information so an individual does not have to consent to the transmission. However, that information is only permitted to be transmitted outside the EU if there is adequate protection – “Personal data shall not be transferred to a country or territory outside the European Economic Area unless that country or territory ensures an adequate level of protection for the rights and freedoms of data subjects in relation to the processing of personal data”. It seems unlikely that you could successfully argue that the US government does not “ensure an adequate level of protection” but there have been some high profile data losses within the US government.
Discrimination – Article 14 of the EU Convention on Human Rights is supposed to prevent discrimination based on, amongst other things, national origin. FFIs have a choice between 1) spending 10s-100s of millions of dollars implementing the system and process changes required to implement FATCA and 2) dump your US customers which, typically, will be less than 1% of your customers. From a business standpoint, it makes perfect sense. Very few FFIs will have a sizable enough base of US person customers for implementation to be by any stretch of the imagination cost effective. But implementing blanket policies that you will not servie US person customers has to be a breach in the same way that a policy of not serving heterosexual or female or whatever customers also is a breach.