Third EU review of Privacy Shield confirms continued adequacy

The EU-US Privacy Shield decision was adopted in 2016. It protects the personal data rights of EU citizens when their data is processed by US organisations that have signed up to the scheme. This is one of the ways that data can flow outside the EU to the US (the other being via standard contract clauses) and there is a requirement for EU organisations that process their data in the US to determine that appropriate safeguards (such as Privacy Shield) are in place.

On 23rd October, the European Commission published its review report on the adequacy of Privacy Shield. The report confirms that the US continues to ensure an adequate level of data protection for those US companies signed up to the scheme. The Commission also notes that “there have been a number of improvements in the functioning of the framework, as well as appointments to key oversight and redress bodies, such as the Privacy Shield Ombudsperson” since the last review. One of the improvements has been the introduction of a more systematic approach to carrying out checks of Privacy Shield signatories.

Commissioner for Justice, Consumers and Gender Equality, Věra Jourová, stated:

“With around 5,000 participating companies, the Privacy Shield has become a success story. The annual review is an important health check for its functioning. We will continue the digital diplomacy dialogue with our U.S. counterparts to make the Shield stronger, including when it comes to oversight, enforcement and, in a longer-term, to increase convergence of our systems.”

However, the report also highlights the need for more to be done to ensure the effective functioning of Privacy Shield in practice, with the Commission indicating they’d like to see further strengthening of the certification process and associated timescales, more FTC investigators, more compliance checks including addressing organisations that falsely claim to be signatories, and the development of additional guidance particular relating to HR data.

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