EU Clarifies Post-Safe Harbor Options For Transatlantic Data Transfers

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By Jared Mondschein

Nov. 12—Companies seeking to transfer certain payroll data from the European Union to the United States still have options in the wake of a decision invalidating Safe Harbor, a program that allowed the transfer of European citizens' personal information to the U.S., the European Commission said Nov. 6 in a communication (2015-566).

Declared invalid by the EU's highest court Oct. 6 (Case: C-362/14, Maximilian Schrems v. Data Protection Commissioner), the Safe Harbor agreement allowed companies to electronically transfer the personal information of Europeans, including payroll information, outside of the European Economic Area as long as the companies complied with EU privacy directives.

Previously only referring to “other mechanisms for international transfers of personal data available under EU data-protection law,” to replace Safe Harbor, the communication explicitly details the alternative means available, including the Standard Contractual Clauses, Binding Corporate Rules and expressly approved derogations.

The European Commission further clarified that while certain member country's data protection authorities “have expressed doubts about the possibility to use transfer instruments” like Standard Contractual Clauses and Binding Corporate Rules for transatlantic flows of information, the European Commission views them to be legal, albeit still subject to oversight and investigations by data protection authorities within certain countries.

To contact the reporter on this story: Jared Mondschein at jmondschein@bna.com

To contact the editor responsible for this story: Michael Baer at mbaer@bna.com

The EU Commission communication is available at http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=COM:2015:566:FIN&from=EN.

A International Payroll Strategic White Paper that details options for firms after Safe Harbor is available here.

More information on payroll issues in Europe can be found within the International Payroll Decisions Support Country Primers.