Negotiators miss deadline for transatlantic data agreement

The U.S. and the European Union have missed the deadline for a critical transatlantic data flow agreement — but those following the talks say negotiators have until Tuesday to strike a deal.

{mosads}Europe’s data privacy regulators gave the two governments until Jan. 31 to come up with a satisfactory replacement when the original Safe Harbor framework was struck down in October. They vowed to take no collective action until that deadline, now come and gone.

But a working group of each EU country’s regulators is set to meet on Feb. 2 to discuss how firms can legally handle data in absence of Safe Harbor. Industry sources tracking the talks say that negotiators have treated Tuesday as a the true drop-dead date for a deal.

More than 4,000 companies, from hospitality to social media, relied on the pact to legally handle EU citizens’ data. The consequences if negotiators don’t succeed, onlookers say, could be disastrous.

Not only will the regulators begin to take enforcement action against firms that don’t have alternative legal mechanisms set up, many say the absence of a low-cost means of data transfer will chill transatlantic trade — valued at over $1 trillion in 2014.

At issue is the U.S. approach to data privacy, which the EU high court deemed inadequate when it invalidated the original framework over its concerns with U.S. surveillance practices.

The 2000 agreement had allowed U.S. firms to “self-certify” they met Europe’s more stringent privacy requirements. In Europe, privacy in enshrined as a fundamental right in the EU Charter.

Those tracking the talks say the same issues have continued to dog negotiators. The EU continues to demand more oversight and transparency in U.S. national security practices than the U.S. is willing to concede.

Commerce Secretary Penny Pritzker is leading the discussions for the U.S., while EU Justice Commissioner Vera Jourova is taking point for the EU.

Those following the talks are still hopeful that negotiators will reach a deal, although the Commerce Department privately told industry members on Friday that there is a possibility that it could fall just short of the goal line.

Jourova is scheduled to update the European Parliament on the negotiations at 7 p.m. CET, or 1 p.m. EST, on Monday, providing some of the first public clues as to how the talks proceeded over the weekend.

Even should Pritzker and Jourova manage to reach an agreement by Tuesday, experts warn that Safe Harbor 2.0 is likely to end up in court over the same concerns that plagued its predecessor.

Privacy advocate Max Schrems, the man who effectively brought down Safe Harbor by lodging a privacy complaint against Facebook, has similar complaints against the company still pending in Ireland, Germany and Belgium.

“I think you will almost immediately see European data protection agencies attack the revised agreement,” said Marc Rotenberg, president of the digital rights advocate Electronic Privacy Information Center, at a recent hearing held by two subcommittees of the House Energy and Commerce Committee.