Bitkom on the ECJ ruling on international data exchange

• Privacy Shield declared invalid

Berlin, 16. July 2020 - In its ruling today, the European Court of Justice (ECJ) has struck down Privacy Shield, the data exchange mechanism between the US and the EU. The Court furthermore decided, that the exchange of data with non-EU countries through Standard Contractual Clauses is legal, but may be assessed on a case-by-case basis.

Susanne Dehmel, member of Bitkom’s management board, explains:

“After the failed Safe Harbor agreement, this is the second time the legal basis for data processing between the EU and the USA has fallen. Even the hitherto valid practice of Standard Contractual Clauses is thrown into doubt by the Court’s decision. For companies with data processing activities in the US this decision creates significant legal uncertainty. Those who processed data based on Privacy Shield will now at least have to resort to Standard Contractual Clauses. Otherwise chaos may ensue. International data flows are a cornerstone of our globalised economy. For globally active companies, legally secure processing of business activities and data flows is paramount. The EU has to re-establish legal certainty as soon as possible and enable data processing with third countries like the US for the long term. Processing data exclusively in Europe is barely feasible from a technical point of view, and it would create a significant competitive disadvantage for European businesses.”