COMMENT: ICLE Comments on White House ‘Privacy Shield’ Order

PORTLAND, Ore. (Oct. 7, 2022) — An executive order announced today by President Joe Biden to establish a new Privacy Shield framework marks an important next step in urgent negotiations to maintain transatlantic data flows between the United States and European Union that power an estimated $333 billion in annual trade of digitally enabled services, according to scholars with the International Center for Law & Economics (ICLE).

The order had been awaited since March, when U.S. and EU officials reached an agreement in principle on a new Privacy Shield, which EU officials insist must address concerns about surveillance practices by U.S. agencies. It will now be submitted to a months-long ratification process by the European Commission but, like earlier agreements, could also face legal challenges, ICLE Senior Scholar Miko?aj Barczentewicz said.

“It is urgent that agreement on an effective Privacy Shield be reached expeditiously, as EU citizens already face the potential to lose access to services like Google Analytics and Facebook, not to mention the potential disruption to financial services like insurance and payments networks,” Barczentewicz said. “What will be crucial is that the U.S. proposal addresses the two aspects the EU expects to be covered: redress for EU citizens and assurances that U.S. data-surveillance practices are ‘necessary and proportionate.’ We can hope that the EU courts will be reasonable, but litigation is all-but-certain.”

For more on the issue, see the ICLE issue brief “The Great Transatlantic Data Disruption,” as well as this ICLE explainer on the importance of data flows to the financial services sector. Reporters interested in interviewing Miko?aj Barczentewicz or other ICLE scholars should contact ICLE Media and Communications Manager Elizabeth Lincicome at [email protected].