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25/09/2016

Officials call for TTIP digital trade boost as US-EU tech tensions linger

Trade & Society

Officials call for TTIP digital trade boost as US-EU tech tensions linger

US Secretary of Commerce Penny Pritzker met with EU Justice Commissioner Vera Jourová on 23 July, in Brussels

[European Commission]

United States Secretary of Commerce Penny Pritzker said during a visit to Brussels on Thursday (23 July) that European leaders need to do more to promote the EU-US Transatlantic Trade and Investment Partnership (TTIP).

Pritzker said her message to EU Commissioners was, “You can’t afford to let the arguments against it go unanswered. You have to be more energetic about responding.”

During a two-day lineup of discussions, Pritzker met with European officials and companies about the American and European technology industries and business conditions for foreign firms in both markets.

On Thursday, Pritzker met with EU Justice Commissioner Vera Jourová, one of the chief negotiators of the EU-US Safe Harbour agreement, which allows American companies to operate in Europe under the condition that they guarantee the safety of Europeans’ data abroad.

Pritzker insisted that Safe Harbour was important to the TTIP talks and told reporters the data sharing deal “forms a foundation that’s important in terms of data flows and certainly in terms of time frame.” Negotiators want to close TTIP negotiations with a draft agreement by the end of this year.

“It’s more complicated to get a trade treaty done. I think it’s important we get Safe Harbour done as soon as possible,” Pritzker added, although she declined to say a Safe Harbour agreement is needed before TTIP negotiations could finish.

Jourová has previously said a new Safe Harbour agreement is stalled because the US hasn’t responded to the European Commission’s demand that companies notify consumers about law enforcement authorities’ access to their data.

Safe Harbour was originally created so that US businesses could comply with EU law, which would otherwise prevent data from traveling from Europe to the US, where privacy rules are less strict.

The European Commission started renegotiating the terms of the agreement following Edward Snowden’s revelations about US intelligence activities in 2013.

>>Read: Safe Harbour deal held up by US

Also on Thursday, a group of seven MEPs from the Parliament’s Internal Market and Consumer Market Committee (IMCO) wrapped up a three-day tour of tech companies in Silicon Valley, where they met with representatives from Google, Twitter, Facebook, Yelp and eBay, as well as with the California telecommunications regulator and other firms.

The MEPs’ visit to those American tech giants comes after several investigations were launched into US firms in recent months.

The European Commission opened an inquiry into online platforms earlier this year, which critics say primarily targets American companies. An antitrust case against Google is ongoing, while local and national courts around Europe have ruled to shut down US-based car sharing service Uber.

German MEP Andreas Schwab (EPP), one of the European Parliament’s most vocal critics of Google’s search business, said the American companies don’t measure up to EU data protection standards.

“We discovered that Europe is much more advanced in the area of consumer and privacy protection,” Schwab told EurActiv.

Last year, the Parliament passed a resolution, introduced by Schwab, urging the Commission to separate search engines from tech companies’ other businesses.

“As regards platform regulation, further work and market inquiries are needed to get possible further regulation right,” Schwab said.

>>Read: EU to probe big tech companies in Digital Single Market overhaul

British MEP Vicky Ford (Conservative) said following the meetings in California, “The digital world is evolving extremely rapidly and here, right in the heart of it, even the biggest tech thinkers can’t predict what’s around the corner. We need to make sure our regulatory environment is future-proof too and that we put consumers at the heart of it.”

While EU and US officials advocate for TTIP’s potential to increase trade in the technology industry, US authorities have also expressed disapproval of the EU’s legal scrutiny of American companies. In February, President Obama called measures against Google and Facebook “commercially driven”.

Pritzker said of the EU’s current investigations, “Our expectation is that those inquiries will be conducted based on the facts and in accordance with EU law.”

“One needs to be able to take people at their word and be optimistic. But in the end, let’s see what happens,” she added.

Asked about the disproportionate number of American companies under scrutiny from the Commission for antitrust and other violations, Pritzker said, “Certainly the folks in Brussels would say it’s a coincidence. I take them at face value.”

Background

Negotiations between the US and the EU on the Transatlantic Trade and Investment Partnership (TTIP) started in July 2013. If successful, the TTIP deal would cover more than 40% of global GDP and account for large shares of world trade and foreign direct investment.

TTIP would be the biggest bilateral trade deal ever negotiated, resulting in millions of euros of savings for companies and creating hundreds of thousands of jobs, supporters claim, boosting the European economy by around 0.5% of GDP.

>> Read our LinksDossier: TTIP for dummies

Negotiations on the free flow of data could be considered as part TTIP, but only after an agreement is reached on the EU’s data protection regulation, EU officials said in March.

EU negotiators realise that the issue is extremely sensitive in Europe, in the wake of the Anglo-American digital espionage scandal exposed by former US intelligence employee Edward Snowden.

Various clauses within the proposed DPR would affect larger US companies offering so-called “over-the-top” data services, such as Google and Amazon, and, more significantly, the burgeoning cloud computing sector. US-based cloud computing service providers currently account for around 85% of global markets.

US industry is keen to see such "data flows" brought within the TTIP discussion, to maintain their business models.

>> Read: Brussels makes overture on ‘data flow’ agreement in TTIP