EU -US Safe Harbor agreement declared invalid

In a historic ruling, the Court of Justice of the European Union (CJEU) has declared that the Commission’s US Safe Harbor Decision is invalid.

The top EU court said, “National security, public interest and law enforcement requirements of the United States prevail over the safe harbour scheme, so that United States undertakings are bound to disregard, without limitation, the protective rules laid down by that scheme where they conflict with such requirements.”

The Safe Harbor agreement between the European Union and the United States allowed Facebook, Google, Twitter and other firms to transfer tremendous amounts of data to their servers in the U.S. The deal was negotiated as America does not have a general data protection law while Europe has strict rules to protect data - doesn't allow it to be transferred to any country that does not adhere to them. It includes a series of principles concerning the protection of personal data to which United States undertakings may subscribe voluntarily.

Microsoft has announced its stance on the ruling via its blog post stating, “For Microsoft’s enterprise cloud customers, we believe the clear answer is that yes they can continue to transfer data by relying on additional steps and legal safeguards we have put in place. This includes additional and stringent privacy protections and Microsoft’s compliance with the EU Model Clauses, which enable customers to move data between the EU and other places – including the United States – even in the absence of the Safe Harbor.”

ArsTechnica explains that as the CJEU was ruling was based on an issue in Ireland, the Irish court is expected to make its own judgement shortly and is expected to follow suit.

“When that happens, one of two things will need to happen: Facebook, and many other US companies with Irish subsidiaries, will need to keep European data within the EU; or the US will need to provide real privacy protection for EU data when it flows back to the US. As the latter is unlikely due to pressure from the NSA and other intelligence agencies, we suspect most US companies will opt for the former”, it added.