Trump Likely to Support EU-U.S. Data Transfer Pact

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By Jimmy H. Koo

Nov. 9 — President-elect Donald Trump will likely see the EU-U.S. Privacy Shield transatlantic data transfer framework as compatible with his pro-growth strategy, privacy and data security attorneys told Bloomberg BNA Nov. 9.

The European Union-U.S. Privacy Shield is relied on by hundreds of U.S. companies, including Microsoft Corp., Facebook Inc. and Salesforce Inc., to ease essential transatlantic data flows of EU citizens’ personal information. Any threat to the continuation of the program would add uncertainty to corporate risk analysis of data transfers from the EU.

“Much of Trump’s rhetoric during the campaign focused on protecting American jobs,” Brian Hengesbaugh, Chicago-based partner and chair of Baker & McKenzie LLP’s Global IT/C Data Security Steering Committee, told Bloomberg BNA. “The reality is that a well-functioning Privacy Shield does protect high tech and other U.S. jobs dependent on transatlantic commerce,” he said.

Timothy J. Toohey, a Los Angeles-based partner and head of Greenberg Glusker Fields Claman & Machtinger LLP’s Cyber Security Practice, said “in theory Trump should be in favor of Privacy Shield as it protects U.S. industry.”

Privacy Shield Uncertainties

The Privacy Shield replaced the U.S.-EU Safe Harbor framework, which was relied on by over 4,400 U.S. companies and thousands of EU companies, but was invalidated by the EU's top court in October 2015 because it didn't offer sufficient privacy protections.

Although it is “difficult to know with certainty whether Trump’s presidency will alter the engagement dynamics” of the Privacy Shield, much of the administration’s approach depends on “who Trump appoints to lead on this particular issue,” Hengesbaugh said. Important appointments include the Secretary of Commerce and the head of the International Trade Administration, which oversees the Privacy Shield certification process, he said.

According to Toohey, Trump may “choose to replace the administrators at Department of Commerce and the replacements may not shown interest in the nuances of technology and may eschew the arrangement simply because it was a product of the prior administration.”

Liisa M. Thomas, partner and chair of Privacy and Data Security Practice at Winston & Strawn LLP in Chicago and London, echoed Hensbaugh’s sentiments, saying that it is too early to tell with certainty how Trump will approach the Privacy Shield. “Over the coming weeks and months we will be watching closely to see the impact the Trump presidency will have on Privacy Shield,” she told Bloomberg BNA.

Toohey agreed, saying that “time will tell particularly as the Privacy Shield arrangement is up for review next year.”

The Privacy Shield faces threats inside the EU from two legal challenges filed by privacy advocacy groups alleging that the program shouldn't have been deemed to adequately protect personal data transferred to the U.S.

By Jimmy H. Koo

To contact the reporter on this story: Jimmy H. Koo in Washington at jkoo@bna.com

To contact the reporter on this story: Donald G. Aplin in Washington at daplin@bna.com

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