DMA hails EU data pact but Govt could yet scupper deal

dma_new2The DMA has expressed relief that Brussels has finally sanctioned the data adequacy agreement – which will maintain the free flow of data from the UK to EU countries and back again – although some remain unconvinced that it will be maintained in the long-term.

The move follows dire warnings of impending doom even before the Brexit negotiations had started, with the CBI claiming that without a deal the UK’s £240bn data economy would fall off a cliff edge. Even the UK Government estimated that the UK economy could lose up to £85bn a year.

Back in February, the European Commission published draft data adequacy agreements which have now been passed by both the European Data Protection Board and EU member states.

The endorsement of EU member states paves the way for the Commission to finalise the agreement before the end of June, when the current transitional arrangements in respect of EU-UK personal data flows expire.

For data transfers from the UK to the EU, the UK government had already confirmed these are authorised to continue until at least 2024.

DMA chief executive Chris Combemale said: “A positive decision on data adequacy is a huge relief for thousands of businesses across the UK – over half of businesses surveyed by the DMA just before Brexit stated this was important for the future of their business.

“The Government estimated that without adequacy the UK economy could lose up to £85bn, so this announcement is a significant boost after a challenging year.

“The DMA has been working with the UK Government and our DMA partners from across the EU since the Brexit deal negotiations began to impress the fundamental importance of this agreement.

“The UK can now progress new data legislation, such as the crucial National Data Strategy, knowing that a high-standards and innovation-focussed approach rests in harmony with the European perspective. We look forward to a strong relationship with Europe and the rest of the world in matters of data transfers and standards.”

However, a UK Government taskforce, comprising three senior Conservative MPs, last week branded GDPR “prescriptive and inflexible” and urged Boris Johnson to replace the rules with a new framework for data protection that does not stifle growth and innovation.

In their report, the MPs –  Iain Duncan Smith, Theresa Villiers and George Freeman – said the UK has a prime opportunity to reform data protection rules, following withdrawal from the EU, and “cement its position as a world leader in data”.

They also criticised the level of compliance obligations British businesses must adhere to, consent mechanisms for being impractical, and slammed rules that limit how companies can develop artificial intelligence systems.

And any radical deviations from GDPR could threaten the adequacy agreement, which will be reviewed every four years.

Sian Stephens, an associate at law firm Payne Hicks Beach, said: `“If a new UK framework does not comply with the EU GDPR, or the EU considers such changes inconsistent, the UK may be deemed a third country for data transfers. This means that data transfers will be more difficult to carry out between the EU/UK.”

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