News Archives

Friday, August 31, 2018

What’s Happening with GDPR Enforcement?

Three months have passed since the EU’s General Data Protection Regulation came into effect, without any reports of significant enforcement actions or fines.  Yes, Google was hit with a whopping $5.1 billion fine on July 18, which would come close to wiping out their profits for the most recent quarter.  However, while the fine was testament to the willingness of EU regulators to maximize the leverage at their command, the violations involved were of antitrust rather than data protection law. 

It is worth noting that the Google fine came two years after charges were filed against the company, and even longer after an investigation into its practices was initiated.  Enforcement by EU data protection authorities often follows similar time frames – drawn out by US standards – in which attempts at education about compliance are followed if necessary by official warnings, the filing of charges if the warnings are not effective, a further period of time to allow a response to the warnings, and only then the issuance of an enforcement order and penalty.  David Meyer describes this more tolerant and collegial approach to enforcement in an IAPP Privacy Advisor article on why GDPR fines could be months away.

Of course, not all GDPR enforcement actions take years to progress.  When confronted with egregious data processing, more fully-empowered DPAs now have the power to order the suspension of such processing.  And even where some aeration of complaints is appropriate, it is worth considering what’s in the pipeline.  According to a poll of DPAs conducted by IAPP, several thousand complaints about violations of the GDPR were received within the first month.  According to  European Data Protection Board Chair Andrea Jelinek, as of July 19 there were around 100 cross-border cases under investigation in the Internal Market Information System (IMI).  According to Giovanni Buttarelli, the EU’s data protection supervisor, as of August 14, an additional 30 alleged violations of the GDPR were being actively investigated by the EU’s independent DPAs.

Furthermore, not all GDPR enforcement is initiated by DPAs.  Max Schrems filed the first legal cases against Google and Facebook under the GDPR just hours after the Regulation came into effect.  The possibility of collective action lawsuits for privacy violations was introduced by the GDPR and one is said to be brewing against Facebook in the UK. 

GDPR enforcement may be slow, but experts have never expected otherwise.  What is clear is that the enforcement is coming.  Companies that still adopt a “show me the money” approach to gauging and responding to risks – and what US privacy consultant hasn’t encountered these – will be ill-prepared for what is to come.

Wednesday, August 29, 2018

Obstacles in Second Annual Review of Privacy Shield

On July 4th, the EU Parliament called for the suspension of the of EU-US Privacy Shield framework if a number of deficiencies in US compliance with its commitments were not remedied by September 1st.  As the second annual EU-US review of the framework, slated for October, draws closer, it is worth considering the obstacles the two parties will need to contend with.  

Here are a half-dozen major concerns the Europeans have: 

1. The failure of the US to have a functional Privacy and Civil Liberties Oversight Board (PCLOB) in place.  While President Trump finally nominated two individuals to the Board on August 7, the US Senate has failed to move forward with the nominations. Earlier in the summer a coalition of major tech companies urged governmental action on the issue.  In late August, a coalition of 31 privacy groups pressed the Senate to act without delay, while Cameron Kerry, former General Counsel and Acting Director of the Department of Commerce, wrote in Lawfare that “The status of the PCLOB is the biggest issue in the annual review underway of the Privacy Shield framework”, adding that “The European Commission counted heavily on independent PCLOB oversight of intelligence surveillance in initially approving the Privacy Shield and, in its first review last year, called for ‘swift appointment of the missing members’ before the next review.” 

2. The refusal of the Trump administration to make public even unclassified portions of a 2014 PCLOB report on NSA surveillance completed for President Obama in December 2016, which prompted an ACLU FOIA request on July 12 that notes the importance of the report’s release to the EU for the Privacy Shield review.

3.  Adding additional fuel to this fire was the May 4 report in the New York Times that the NSA had tripled its collection of data from US phone companies and the August 13 report of the Inspector General of the NSA, which detailed numerous privacy concerns with the agency’s open source intelligence collection process.

4.  The failure of the Trump administration to appoint the permanent and independent Ombudsperson called for under the Privacy Shield framework.

5. Revelations concerning massive abuses of personal information by Facebook and Cambridge Analytica, even though both were participants in the Privacy Shield framework.

6. Concerns about the newly-enacted CLOUD Act creating potential conflicts with EU data protection laws.

As far as is known, the US has no complaints with Europe about the operation of Privacy Shield; the complaints all run the other way.   How tolerant the EU will be of the US failure to live up to its Privacy Shield commitments remains to be seen.

Friday, August 17, 2018

Eight Years Later, Brazil Enacts General Data Privacy Law

On August 14, following passage by the Federal Senate a month earlier and years of false starts, President Michel Temer signed into law Brazil’s General Data Privacy Law, a comprehensive data protection bill which will come into effect in early 2020.  Aligning closely with the EU’s General Data Protection Regulation, the law lays the foundation for the pursuit of an adequacy decision from the EU.  Key provisions include requirements for data protection officers; documentation and registration of the legal basis for processing; strict requirements for consent; data breach notification; requirements for privacy by design and privacy impact assessments; restrictions on cross-border data transfers; and fines for violations of up to 2% of gross sales.  The cross-border restrictions even go beyond the requirements found in the GDPR, by applying to any processing conducted solely outside Brazil that affects or targets Brazilian citizens.  President Temer exercised his right to carry out line-item vetoes by rejecting several provisions of the bill passed by the Senate, including one calling for creation of an independent supervisory authority.  However, Temer attributed the rejection to procedural defects and pledged to send Congress a separate bill establishing a national DPA that would remedy the problem.