Fifteen countries ask for EU legislation on data flows

Ministers from 15 countries want the European Commission to propose new legislation allowing data to travel between EU countries without restrictions. A Commission consultation on data flows also suggested changes to data rules that could upset the car industry. [Wikimedia]

Ministers from 15 EU countries have asked the European Commission to focus on removing barriers to digital trade one week before the executive presents a mid-term review of its flagship Digital Single Market policies.

Denmark drafted the two-page letter to Commission President Jean-Claude Juncker asking for less regulation of digital policies—with one exception. The 15 countries want the executive to propose legislation to get rid of data localisation measures that prevent data from being transferred easily between EU countries. The Commission has so far gone back and forth on whether to propose a new law and just closed a public consultation last week on data flows.

“Other countries and regions are making great strides towards reaping the benefits of the new digital economy,” the letter reads. EU digital policies might require the Commission to “fundamentally rethink, update or abolish existing regulations”.

Aside from Danish Industry Minister Brian Mikkelsen, ministers from Belgium, Bulgaria, the Czech Republic, Finland, Ireland, Latvia, Lithuania, Luxembourg, the Netherlands, Poland, Slovakia, Slovenia, Sweden and the UK signed the letter, which was sent to Juncker today (2 May).

The Commission will announce its two-year review of the Digital Single Market, a 16-point plan for technology policies, next week. Commission Vice-President Andrus Ansip and then Digital Commissioner Günther Oettinger announced the Digital Single Market plans in May 2015. Since then, the Commission has come up with proposals or announcements for almost everything on its list of priorities for the initiative. Oettinger switched to a new job as the EU budget Commissioner at the beginning of this year.

One diplomat called data localisation one of the few areas where some member states want entirely new EU legislation, marking a change from their call for less regulation. Some countries have appealed to the Commission to create rules that would make it illegal for member states to require data to be stored domestically. A new proposal might encourage companies to store data in parts of the EU where they don’t already.

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The letter asks for an “early presentation of a legislative proposal providing for the removal of localisation requirements that cannot be objectively justified”.

The Commission published a communication in January emphasising the importance of letting data move across EU borders and not hampering an industry valued at around €272 billion in 2015, according to figures from the executive.

“Coordinated approach”

Ansip said at the time that he wanted a “coordinated and pan-European approach”. But some countries were disappointed that binding legislation on data flows was not a part of that announcement.

Fourteen countries sent a similar letter to the Commission in May 2016 asking for legislation making cross-border data flows easier.

Member states call for the removal of barriers to data flows

Half of the European Union’s member states on Monday (22 May) called for the removal of barriers to the free flow of data both within and outside the 28-nation bloc to ensure the continent can benefit from new data-driven technologies.

Car manufacturers were particularly outspoken about the Commission’s announcement earlier this year on data flows.

Part of the Commission’s plans included measures that could affect which companies can have access to data collected by cars with internet-connected functions like entertainment systems, internet access and automatic brakes. Those systems might be operated by separate companies that have contracts with car manufacturers. Manufacturers lobbied the Commission to make sure they keep full access to car owners’ data, which they could sell to other firms.

EU Competition Commissioner Margrethe Vestager singled out her competition concerns about connected cars last autumn, warning that car manufacturers’ service contracts with other firms “shouldn’t deny the others a chance to compete”.

The ministers’ letter today names competition policy as something that could help new digital businesses.

“Competition law scrutiny of new digital markets is important and should be a priority with the aim to create a more level playing field between existing industries and new upcoming competitors in the field of digital platforms and sharing economy providers,” they wrote.

The Commission also announced that it is considering changes to insurance rules as part of any possible legislative proposal on data flows. Manufacturers of internet-connected devices like driverless cars could be held liable instead of drivers, under suggested legal changes that the Commission mentioned in its public consultation.

Changes to legislation affecting data ownership and liability are not expected before the end of this year.

Carmakers fear EU plans to ease data flows will help tech rivals

European car manufacturers are seeking full control over the data sent to them by connected vehicles they put on the road, and fear a move by Brussels that would impose sharing that data with rivals.

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