No ‘Safe Harbor’: Mixed reaction as top European court strikes down EU-US data-transfer agreement

The highest EU court said in a milestone ruling on the “Safe Harbor” data-transfer agreement that the US compromised the essential European right to privacy. Facebook and other companies could now be barred from blanket-sending data to the US.

“The Court of Justice declares that the Commission’s US Safe Harbour Decision is invalid,” the court ruling said.

Austrian law student Max Schrems, 28, filed a complaint to the data protection commissioner in 2013 saying that the US law didn’t offer a sufficient level of protection against surveillance on data sent via Facebook to the United States. This came in the wake of former NSA contractor Edward Snowden’s revelations on mass US surveillance.

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The hearing of the case brought against Facebook took place October 6 in Ireland, where the company has its European headquarters. As a result, the Safe Harbor system enabling data transfers from the European Union to the United States by thousands of companies was found to be invalid.

According to the ruling, the Irish data commissioner must now examine Schrems’ complaint “with all due diligence” and “decide whether ... transfer of the data of Facebook’s European subscribers to the United States should be suspended on the ground that that country does not afford an adequate level of protection of personal data.”

There were no Facebook representatives at the hearing which was explained later in a statement: “This case is not about Facebook. The Advocate General himself said that Facebook has done nothing wrong,” the company said.

Edward Snowden, who has just recently opened his Twitter account, welcomed the decision and was quick to congratulate Schrems.

Schrems replied he was honored to be mentioned in a tweet by the famed whistleblower.

“This decision is a major blow for US global surveillance that heavily relies on private partners… this case law will be a milestone for constitutional challenges against similar surveillance conducted by EU member states,” Schrems said in a statement.

“Today’s judgment puts people’s fundamental right to privacy before profit. Without effective safeguards for privacy, the Web as we know it could wither and die,” said Renata Avila, global campaign manager at the World Wide Web Foundation.

Sophie in ’t Veld, a leading Liberal lawmaker in the European Parliament, welcomed the ruling and called the Safe Harbor “a travesty of legality,” AP said.

However, not everyone shares the excitement with the verdict since it leaves a whole lot of European companies in search for alternative means for transferring data.

“This is extremely bad news for EU-US trade,” said Richard Cumbley, Global Head of technology, media and telecommunications at law firm Linklaters, Reuters reports. “Without Safe Harbor, [businesses] will be scrambling to put replacement measures in place.”

At the same time, others pointed out that the impact of the decision will be unclear, as it does not bar data transfers to the US, only adding the need for national data protection authorities to review such transfers.

Referring to businesses’ concerns over expected new regulations, Schrems himself said that “despite some alarmist comments I don’t think that we will see major disruptions in practice.”