Draft Adequacy Decision on EU-US data flows published


The European Commission has published on 13 December 2022 its preliminary “adequacy decision” intended to allow EU-US data flows to business that will have adhered to the Transatlantic Data Privacy Framework ("TADPF”).

The decision is the next step following the Executive Order proposed by US President Joe Biden on 7 October 2022 to implement the EU-US TADPF and replace the invalidated Privacy Shield (“Executive Order”).

The Executive Order seeks to limit the ability of US agencies to access large amounts of personal data transferred from the European Union. The Executive Order also establishes a new legal redress mechanism for EU citizens to challenge US intelligence agencies’ surveillance activities as violations of the Executive Order. Read more here about this redress mechanism.

The changes aim to addresss the criticism of the Court of Justice of the European Union (“CJEU”) in its Schrems II ruling of 16 July 2020 (C-311/18), which declared the previous data transfer pact known as the Privacy Shield Framework invalid because mass surveillance by US intelligence agencies did not meet the minimum standards of the rule of law.

The publication of the draft text kick-starts the ratification process, which may take up to six months. The adequacy procedure for the previous Privacy Shield Framework took about half a year.

The European Data Protection Board will now issue an opinion on the draft adequacy decision and, although not able to reject it, it may prompt rewrites. In addition, EU Member States can give their opinion in what is referred to as the “comitology procedure”. As a final step, the adequacy decision will be published in the Official Journal of the European Union.

EU Justice Commissioner Didier Reynders has recently stated that he is confident that the new EU-US TADPF will withstand court scrutiny and that the adequacy decision will likely be adopted before July 2023.

It is expected that Max Schrems, the Austrian privacy activist known for his successful challenges of the two previous EU-US data agreements, will challenge the TADPF before court. Indeed, he has already stated his intention to challenge the framework and push for a Schrems III decision, claiming that the Executive Order fails to adequately limit US surveillance and provide effective legal redress.