Irish DPC to assess TikTok’s plans for opening Data Centre in Ireland

13. August 2020

The short video app TikTok is planning to establish a data centre in Ireland under the One Stop Shop (OSS) data processing mechanism, the Irish Data Commission has stated.

However, the company needs to first be assessed to determine if they meet the requirements of the OSS.

The OSS rules, introduced under the General Data Protection Regulations (GDPR) rules, mean companies can make the Irish Data Protection Commission the lead supervisory authority, if they meet the criteria, and would not have to deal with regulators in each of the 28 EU member states but could be monitored by a lead regulator in one state. This would benefit the company in the case that if something happens, it would be one investigation, one decision and one appeal, rather than one for each country affected.

These plans come at a time when the popular app is facing some criticism, however. Not only is TikTok on the verge of being banned in the United States, a lot of doubts in regard to their handling of user data have surfaced in the past few months.

Last week in Beijing, the Beijing Internet Court ruled against TikTok’s owner Tencent Holdings in cases alleging the misuse of user data. The data was shared without consent between the WeRead and WeChat apps, violating the users’ privacy.

The move to establish a data centre in Ireland “will create hundreds of new jobs and play a key role in further strengthening the safeguarding and protection of TikTok user data with a state of the art physical and network security defense system planned around this new operation,“ stated Global Chief Information Security Officer of the company, Roland Cloutier.

Following the moves of big tech giants of recent years, TikTok plans to open the data centre by the year 2022. The Irish Data Protection Commissioner stated that the examination for the OSS mechanism is currently underway.

U.S. Commerce Department publishes FAQs on EU-US Privacy Shield

12. August 2020

The U.S. Commerce Department has released a frequently asked questions page (FAQ) with regards to the EU-US Privacy Shield, following the latest decision of the Court of Justice of the European Union (CJEU) in the Schrems II case.

The FAQ consists of five questions which revolve around the situation after the invalidation of the Privacy Shield by the CJEU, especially the status of companies already certified under the Privacy Shield.

The Commerce Department states in its FAQ that despite the invalidity of the Privacy Shield certification as a GDPR compliant transfer mechanism, the decision of the CJEU does not relieve companies certified under the Privacy Shield from their obligations. On July 21, 2020, the Federal Trade Commission (FTC) stated that they expect controllers to continue to follow the obligations laid out under the Privacy Shield Framework for transfers.

Further, the Commerce Department will continue to administer certification and re-certification under the Privacy Shield despite the new development. The Commerce Department emphasizes that the continued dedication to the Privacy Shield will show the commitment of the parties and the controllers certified under it to the Data Protection cause.

However, the Commerce Department also notes that the costs coming along with a Privacy Shield certification will remain, which could have an effect on the motivation for companies to get self- and re-certified.

CJEU judges the EU-US Privacy Shield invalid

16. July 2020

On June 16th, 2020, the Court of Justice of the European Union (CJEU) has declared the invalidity of Decision 2016/1250, therefore rendering protection granted to data transfers under the EU-US Privacy Shield inadequate.

The background

The case originated in a complaint of Mr. Max Schrems against Facebook Ireland regarding the transfer of his personal data as a Facebook user to Facebook Inc., situated in the USA, for further processing. Mr. Schrems lodged a complaint with the Irish supervisory authority seeking to prohibit those transfers. He claimed that the law and practices in the United States do not offer sufficient protection against access by the public authorities to the data transferred to the USA. That complaint was rejected on the ground that, in Decision 2000/5205, the Safe Harbour Decision, the Commission had found that the United States ensured an adequate level of protection. In a judgment delivered on October 6th, 2015, the CJEU, to which the High Court of Ireland had referred questions for a preliminary ruling, declared that decision invalid, resulting in the Schrems I judgment.

Today’s judgement in the Schrems II case came from the request of the Irish High Court to Mr. Schrems to reformulate his initial complaint, seeing as the Safe Harbour Agreement had been deemed inadequate. In the following, Mr. Schrems reformulated his complaint, and claimed that the United States does not offer sufficient protection of data transferred to that country. He seeks the suspension of future transfers of his personal data from the EU to the United States, which Facebook Ireland now carries out pursuant to the Standard Contractual Clauses (SCCs) set out in the Annex to Decision 2010/87. After the initiation of those proceedings, the Commission adopted Decision 2016/1250 on the adequacy of the protection provided by the EU-U.S. Privacy Shield.

In its request for a preliminary ruling, the referring court asked the CJEU whether the GDPR applies to transfers of personal data pursuant to the SCCs, what level of protection is required by the GDPR in connection with such a transfer, and what obligations are incumbent on supervisory authorities in those circumstances. The High Court of Ireland also raised the question of the validity of both decisions,  Decision 2010/87 and  Decision 2016/1250.

Judgement in regard to SCCs

In its judgements, the CJEU has stated that it had, after examination of the SCCs in light of the Charter of Fundamental Rights, found nothing that affected the validity of the SCCs and Decision 2010/87.

With regards to the transfer of personal data to third countries, the CJEU claims that the requirements for such purposes set out by the GDPR concerning appropriate safeguards, enforceable rights and effective legal measures must be interpreted in such a way that data subjects whose personal data is transferred into a third country must be afforded a level of protection essentially similar to the level of protection granted within the European Union by the GDPR.

Data Protection Authorities must, unless an adequacy decision has been ruled by the Commission, be required to suspend or prohibit a transfer of personal data to a third country which does not meet these requirements.

The CJEU holds that the SCCs are still effective mechanisms that make it possible to ensure compliance with a level of protection required by the European Union. In that regard the CJEU points out that this imposes an obligation on the data exporter and the recipient of the data to verify, prior to any transfer, whether that level of protection is respected in the third country concerned, and to suspend the transfer of the personal data if it is not.

Judgement in regard to the EU-US Privacy Shield

The CJEU, after thorough examination, concluded that the EU-US Privacy Shield is not adequate protection for transfers to the USA.

This result comes from the fact that the far-reaching US surveillance laws are in conflict with EU fundamental rights. The USA limits most of its protections of personal data from governmental surveillance to US citizen, but does not extend that protection to the personal data of citizens of other countries.

In essence, the limitations on the protection of personal data arising from the domestic law of the USA on the access and use by US public authorities of such data transferred from the European Union are not restricted in a way that satisfies requirements that are equivalent to those required under EU law, which were mentioned in regards to SCCs above. By the principle of proportionality, the surveillance programmes based on those provisions are not limited to what is strictly necessary.

Unless an empowerment and independence of the Ombudsperson takes place, which would give the competence to adopt decisions which are binding on US intelligence services, there are no substantial cause of actions for data subjects before a body which gives legal guarantees in the way that is required by European law for transfers to be equivalent in protection.

Assessment

Overall, the CJEU states that necessary data transfers are still able to continue under Article 49 of the GDPR. However, the provision’s interpretation is restrictive, leaving most companies with data transfers to the USA which are now considered illegal.

Due to the requirements of adequate protection even when relying on the validated SCCs, transfers under such circumstances may also be found unlawful due to the local intelligence laws in the USA, which do not uphold the requirements necessary by European law.

Overall, it is a clear statement of the necessity of reforms of the US intelligence laws, which have to create adequate protections to be able to guarantee the same level of data protection as the European Union, if they want to continue data trades and data transfers necessary for processing.

What does this mean for you?

  • If your business has a EU-US Privacy Shield certification, and uses such for legitimization of data transfers within a group of companies, you should push towards the use of the European Standard Contractual Clauses within that corporate group.
  • If you are employing service providers which rely on the EU-US Privacy Shield certification, you should also push for the use of Standard Contractual Clauses, or base the data transfer on a different solution for an adequate level of data protection.

CIPL submits DSR “White Paper” to the EDPB as input for future Guidelines

The Centre for Information Policy Leadership (“CIPL”) at Hunton Andrews Kurth submitted its White Paper on Data Subject Rights (DSR) on July 8th, 2020, as input for the European Data Protection Board for future Guidelines on the subject.

The White Paper examines the effectiveness of the DSRs by keeping in mind the interpretation in the context of today’s data driven economy. It puts forth that the Guidelines should take into account new business models, data-driven processes and the data economy as well as the digitalisation of society.

In that aspect, the Paper offers suggestions for the EDPB to consider and reflect upon. Some few of the main subjects the Paper requests the Guidelines to touch on are:

  • Clarification of the requirements governing verification of the identity of individuals submitting DSR requests
  • Determination that the one-month deadline for responding to a DSR request will run from the point at which the request’s scope is clear and the identity of the requestor has been verified, additionally that extensions to the deadline may be justified in certain circumstances, e.g. where the controller receives an unusually high volume of DSR requests, etc.
  • Recognition that compelling interests of the organization, third-parties or society may limit DSR requests;
  • Limitations on excessive, unfounded or abusive requests from Data Subjects which are intended to disrupt the business;
  • Declaration of a proportionate approach in responding to DSR requests, particularly with regards to the cost to the organization.

Furthermore, the White Paper highlights the necessity to change the level of a DPO’s responsibility in regards to DSRs, dividing it across different team rather than making the DPO solely responsible for the DSR requests.

In addition, the Paper demands the EDPB to establish a better harmonization of the application of the DSRs across the European Union, which comes from differences in Guidelines made by the different Data Protection Authorities (DPAs). The EDPB should have in its interest to establish common ground for the handling of DSRs and the related requests, as well as the handling of infringements in the matter by DPAs.

The Paper stems from the EDPB stakeholders’ event on DSR in Brussels on November 4, 2019, and was drafted to visualize certain issues on the matter to the EDPB which have crystalized themselves in the two years since the application of the GDPR.

EU Commission highlights necessary preparations for end of Brexit transitioning period

14. July 2020

The European Commission has published a communication on July 9th, 2020, in order to highlight the main areas of change in view of the upcoming end of the transitional Brexit period before January 1st, 2021.

The communication aims to facilitate readiness and preparations for citizens, businesses and stockholders once the UK leaves the European Union. The European Commission states that readiness for these broad and far reaching changes is key, especially since they will take place regardless of the outcome of the negotiations between the UK and the EU.

The communication breaches subjects such as trade in goods, trade in services, energy, travelling and tourism, mobility and social security coordination, company law and civil law, intellectual property, data transfers and protection and international agreements of the EU.

The communication also includes advice in each of those areas and subjects for businesses to be able to start preparations in order to cope with the changes ahead.

With a view on data protection, the European Commission’s communication states that data transfers can continue after January 1st, 2021, however they will have to comply with EU rules and regulations for Third Country Transfers as put forth by the General Data Protection Regulation (GDPR). The Commission specifies the tools set out in Chapter V of the GDPR, which include Binding Corporate Rules, Standard Contractual Clauses, as well as an Adequacy Decision by the European Commission. The communication states that the EU will try its best to conclude the assessment of the UK regime by the end of 2020, in order to give at least some form of security for data transfers after the transitional period ends. On sides of the United Kingdom, the Adequacy of the European union is guaranteed until 2024.

The advice of the European Commission emphasizes compliancy with the GDPR as the best preparation for the Brexit, but lacks security as to what will happen on January 1st, 2021, especially with regards to the future applicable laws.

South Africa’s Data Protection Act comes into force

9. July 2020

On July 1, 2020, South Africa’s Protection of Personal Information Act 2013 finally came into effect. The Act had been in planning for the last seven years, with parts of it already published in 2014, and will fully come into effect with oversight provisions in June 2021, allowing for a 12 months period to enable companies to become compliant with the new regulations.

Due to its long planning period, most companies already have organised compliancy. On the other side, a lot of businesses haven’t taken the necessary steps yet, as they have been waiting for the final push to see if the Act would even come into effect. Full enforcement will be enacted on July 1, 2021, giving those companies a countdown to become compliant.

The initial draft made in 2013 was mainly based on the EU Data Protection Directive 95/46/EC, with some changes for stricter provisions. The partial enforcement in 2014 allowed for the establishment of an Information Regulator in 2016, which has released Guidances in light of the future enforcement of the Act.

The right to privacy has been a fundamental right since 1996, and the act aims to promote the protection of personal data for any business processing personal information in South Africa. However, different from a lot of other Data protection Regulations around the world, the South African Protection of Personal Information Act also includes protection of the juristic person, such as companies, banks, trusts, etc.

One of the bigger changes in regards to South Africa’s previous handling of protection of personal data represents the obligation to notify a data breach to the authorities and, in some cases, to the data subjects. It also includes further requirements for international data transfers, as well as finally detailing data subjects’ rights.

Transatlantic Data Transfers in light of the Two Year Anniversary of GDPR Application

7. July 2020

In the last two years since the General Data Protection Regulation (GDPR) came into effect on May 25, 2018, it has received an overall positive feedback and structured the data protection culture not only in the European Union, but has set an example for international privacy standards.

However, especially from the American side of the world, criticism has been constant. Different principles are a prerequisite for different opinions and priorities, and the effort to bring European data protection standards and American personal data business together has been a challenge on both sides.

One of the main criticisms coming from the US government is the increasing obstacles the GDPR poses in case of cybercrime investigations and law enforcement. Not only the restrictive implications of the GDPR are an issue, but also the divergent interpretations due to national adaptations of the GDPR are seen as a problem by government officials.

In the cases of cybercrime, the main issue for the US critics is the now less effective database of domain name owners, WHOIS. The online directory, which was created in the 1970s, is an important tool for law enforcement combatting cybercrime. Before the GDPR came into effect in 2018, the request for information on domain owners was straightforward. Now, due to the restrictions of the GDPR, this process has been made long and tedious.

But fighting cybercrime is not the only tension between the EU and the USA concerning data protection. In a judgement in the Schrems II case, expected for July 16, 2020, the European Court of Justice (ECJ) is expected to take a stance on transatlantic data transfers and the current Privacy Shield, which is the basis for the EU-US dataflows under adequate data protection standards. If the Privacy Shield is deemed insufficient protection, it will have a major effect on EU-US business transactions.

However, these are issues that the European Commission (EC) is very aware of. In their communication concerning the two-year review of the GDPR, the Commission stated that they are planning to balance out diverging and fragmented interpretations of the GDPR on national levels and find a common data protection culture within Europe.

In addition, the restrictions the GDPR poses to law enforcement are another point the European Commission knows it needs to fix. The plan for the future is a bilateral and multilateral framework that can allow for simple requests to share data for law enforcement purposes and avoid conflicts of law, while keeping data protection safeguards intact.

The upcoming judgement of the ECJ is seen with watchful eyes by the Commission, and will be incorporated in their upcoming adequacy decisions and re-evaluations, as well as their development of a modern international transfer toolbox, which includes a modernized version of the standard contractual clauses.

Overall, the two-year mark of the existence of the GDPR is seen more as a success, despite the clear areas for future improvement. One of the big challenges in transatlantic data transfers ahead is without a doubt the outcome of the judgement in the Schrems case in mid-July, the implications of which are, at this point in time, not yet able to be defined.

Regional Court of Vienna judges in Schrems against Facebook case

6. July 2020

On June 30th, 2020, the Vienna Regional Court passed judgement in the case of Max Schrems against Facebook Ireland Limited, in the case number 3 Cg 52/14k-91 (in German). In the following, we will be presenting the case and the court’s judgement.

Facts of the case

In the years 2011, 2012, 2013, 2015 and 2019, the plaintiff submitted requests for information in accordance with Art. 15 GDPR. The defendant initially responded to these requests with an 18-page pdf file dated 09.06.2011 and a CD with further pdf files of 1,222 A4 pages. Despite the information provided, the plaintiff felt that his rights as stated by the GDPR had been violated, as none of the consecutive requests had been answered. From his point of view, the information provided was neither sufficient in terms of content nor was the number of responses in relation to the number of requests made sufficient for him.

Furthermore, the plaintiff was concerned by the data processing by third parties, about which he received no clear information. He also stated that he was “Controller” in the sense of the GDPR. The defendant had not fulfilled the resulting requirements, as Data Processor, of concluding a Data Processing Agreement with the plaintiff. Finally, the defendant had violated Art. 9 GDPR by failing to obtain consent in respect of his interests and further sensitive data, for which the plaintiff demanded injunction for future data processing.

Guiding principles of the judgement

The Regional Court judged on the following guiding principles in the case:

  • the defendant must provide the plaintiff with complete information in writing and free of charge within fourteen days about all personal data of the plaintiff processed by it, stating the exact origin and, if applicable, the exact recipients of the data,
  • and pay the applicant the sum of EUR 500 in damages within fourteen days.

Reason for decision

The regional court’s guiding principles on the case were the only points in the plaintiff’s claim in which they judged in his favour. The court has stated that the tools used and information given by the defendant to inform the plaintiff about the processed personal data is not enough to meet the requirements of Art. 15 GDPR’s right of access. This results in a lack of control of the plaintiff over his own personal data, which goes against his fundamental right to data privacy. Therefore, the court has ruled damages in the sum of EUR 500 as adequate compensation for the infringement of Mr. Schrems’ privacy.

Regarding Mr. Schrems’ other points, the court ruled that because the plaintiff uses the Facebook platform in light of private/family activities, he cannot be a Controller of the processed personal data due to the fact that according to Art. 2 II lit.c GDPR, the regulation does not apply to him. This also applies to social media and online networks, as mentioned in Recital 18. Therefore, Facebook is not a Data Processor in the terms of those private activities and purposes, which negates the requirement of a Data Processing Agreement according to Art 28 GDPR.

Further, the court sees no sensitive data in the lines of Art. 9 GDPR to be at risk. In light of the personalisation of the platform, such as personalized ads and suggestions, the court stated that this belongs to the core of the defendant’s business activities. As such, there is no consent needed, as the defendant states that the processing of the data is for the purpose of a contract. The plaintiff, according to the court, has entered into such a contract knowing of the terms of service and on his own behalf in order to use the platform’s services. An injunction regarding the future processing of such personal data is therefore not to be applied.

Assessment

Overall, the Regional Court’s judgement has only a minimal practical relevance, as it is hard to fully assess the consequences of the passed judgement. One can neither say how the conduct will affect the future management of the company, nor is it certain whether the judgement will even become final in the first place. However, the plaintiff has already announced on NOYB’s homepage that he will lodge an appeal, and it therefore will remain to be seen what practical relevance can be drawn from the case in the future.

German State Data Protection Commissioner imposes 1.2 million € GDPR fine

1. July 2020

The German State Data Protection Commissioner of Baden-Württemberg (“LfDI Ba-Wü”)  imposed a GDPR fine of 1.240.000€ on the German statutory health insurance provider AOK Baden-Württemberg (“AOK”). The fine was a result of the health insurance’s lack of technical and organisational measures pursuant to Art. 32 GDPR. It is the highest fine the LfDI Ba-Wü has ever imposed.

Between 2015 and 2019 the AOK organised lotteries on various occasions and collected personal data of the participants, including their contact details and current health insurance affiliations. The AOK wanted to use the data of the lottery participants for advertising purposes, insofar as the participants gave their consent to this. To ensure the security of processing, the AOK implemented internal guidelines and data protection training of their staff as technical and organisatioal measures. However, these measures were not sufficient to comply with Art. 32 GDPR because AOK staff used the personal data of more than 500 lottery participants for advertising purposes without their prior consent.

Following the investigation of the LfDI Ba-Wü, the AOK immediately stopped all marketing activities in order to revise their internal policies and processes against the GDPR. The LfDI Ba-Wü explained that in determining the extent of the fine, it considered the following mitigating factors:

  • the cooperation of the AOK with the Data Protection Authority,
  • the fact that the AOK as a statutory health insurance provider is an important part of the German healthcare system, and
  • the burdens of the current Corona-Pandemic on the healthcare system.

Finally, the Commissioner pointed out that technical and organisational measures must be regularly adjusted to the actual conditions of each processing activity, in order to ensure an adequate level of data protection in the long term.

EDPB releases new official register of Art. 60 GDPR decisions

29. June 2020

On 25 June 2020, the European Data Protection Board (“EDPB”) released a new register of final decisions by national European Data Protection Authorities (Supervisory Authorities) cooperating with one another pursuant to Art. 60 GDPR. The register provides access to the decisions themselves, summaries of the decisions in English, and information on the identity of the cooperating Lead Supervisory Authority and Concerned Supervisory Authorities.

The GDPR postulates that Supervisory Authorities have to cooperate in potential cases of GDPR violations that include cross-border data processing activities. During this cooperation, the Lead Supervisory Authority will be in charge of preparing the draft decision and involving the Concerned Supervisory Authorities, and will act as the sole interlocutor of the Controller or Processor (“One-Stop-Shop”-Principle), Art. 56 and Art. 60 GDPR.

To date, the new EDPB register contains 110 final decisions. The EDPB states in its announcement that ‘the register will be valuable to data protection practitioners who will gain access to information showcasing how SAs work together to enforce the GDPR in practice.’

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