Data protection: out with the old, in with the new

The widely-trailed revision to EU data protection law has been unveiled today by the European Commission, who have proposed a “comprehensive reform” to EU data protection legislation.

The fundamental change is moving from national laws made under a harmonising directive, to a single regulation which will apply directly across Europe. While it’s going to take a little while to work through all the details – and the proposal still has to be discussed and ratified by EU member states and the European parliament – the key changes as summarised in the Commission’s press release are:

  • A single set of rules on data protection, valid across the EU.
  • Unnecessary administrative requirements, such as notification requirements for companies, will be removed. This will save businesses around €2.3 billion a year.
  • Instead of the current obligation of all companies to notify all data protection activities to data protection supervisors – a requirement that has led to unnecessary paperwork and costs businesses €130 million per year, the Regulation provides for increased responsibility and accountability for those processing personal data.
  • For example, companies and organisations must notify the national supervisory authority of serious data breaches as soon as possible (if feasible within 24 hours).
  • Organisations will only have to deal with a single national data protection authority in the EU country where they have their main establishment. Likewise, people can refer to the data protection authority in their country, even when their data is processed by a company based outside the EU.
  • Wherever consent is required for data to be processed, it is clarified that it has to be given explicitly, rather than assumed.
  • People will have easier access to their own data and be able to transfer personal data from one service provider to another more easily (right to data portability). This will improve competition among services.
  • A ‘right to be forgotten’ will help people better manage data protection risks online: people will be able to delete their data if there are no legitimate grounds for retaining it.
  • EU rules must apply if personal data is handled abroad by companies that are active in the EU market and offer their services to EU citizens.
  • Independent national data protection authorities will be strengthened so they can better enforce the EU rules at home. They will be empowered to fine companies that violate EU data protection rules. This can lead to penalties of up to €1 million or up to 2% of the global annual turnover of a company.

In addition, there will be a new directive to “apply general data protection principles and rules for police and judicial cooperation in criminal matters”.

The “right to be forgotten” has been the most widely-publicised measure under consideration, and will certainly raise some tricky practical issues. However, I suspect that the biggest practical impact will come from the requirement for explicit consent, where consent is required. At present, certainly under UK data protection law, a lot of reliance is placed on implied consent; see, for example, the Information Commissioner’s guidance on the new cookies law, as discussed in a previous post. Explicit consent will greatly increase the practical burden on many businesses.

The new law, if adopted, will come into force two years after it is adopted, giving businesses and other organisations time to prepare for the new regime.

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