It appears that not everyone is quite so chuffed as the DMA with the EU Council’s stance on the data protection reforms after digital and online business trade body IAB Europe claimed the changes will drive Internet business out of Europe.
It claims the Council’s position, which was signed off earlier this week, will batter the online ad industry and push more European internet businesses over to the US.
The IAB’s position differs wildly from the DMA, which believes many of the Council’s recommendations will be better for direct marketers.
The IAB highlights three main causes of concern with the new regulation.
First, the regulation is likely to place “additional restrictions on companies’ ability to process data, making the new rules more restrictive than those now in force”.
It added: “Several provisions of the text, taken together, may outlaw the processing of aggregated customer data that provides advertisers crucial information about the effectiveness of their ads.” This, it claims, will turn back the clock – not help to adapt EU rules to the Internet age.
Second, the new regulation will expose companies to the risk of punitive fines in even inadvertent breaches of the rules, including for data processing that causes no meaningful privacy risk to users, or for cloud computing companies that simply provide the platform for others to run their organisations.
Finally, the idea of the ‘one-stop shop’ principle, which would allow companies to deal with just one regulator in the country in which its HQ was based, has been scrapped.
“This one-stop shop would have increased efficiency and represented a major advance in Europe’s quest to create a functioning digital single market. But today’s text gives any ‘concerned’ authority the power to object to a decision taken by another national regulator,” claimed IAB Europe.
“The current approach is blunt and indiscriminate – a far cry from the supposed objective of making EU rules fit for purpose in the internet age,” said Townsend Feehan, chief executive of IAB Europe. “The future regulatory framework needs to enable digital advertising to fund the informational, educational, entertainment and e-commerce services that European users enjoy online at little or no cost.
“That is not what is on the table right now. It is no exaggeration to say that a draconian regulation could drive small and medium-sized companies responsible for much of the innovation we see in the industry today out of Europe.
“Users do need transparency and choice about the processing of their data online, including for advertising,” said Feehan. “A data protection regime that is more constraining than the current law, dating from 1995, would undermine Europe’s ability to benefit from the digital revolution, and needlessly handicap dynamic EU-based SMEs that are trying to compete in the global marketplace,” the organisation concluded.
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