Failure to comply with the EU directive could bring about serious consequences. While those closest to the issue don't expect the EU Commission to start issuing harsh sanctions from the outset, they anticipate some precedent-setting cases to arise in 1999 as European governments take U.S. retailers and other business affected by this directive, such as banks and health care companies, to task. The EU privacy directive is not focused simply on the Internet. Data collected at a POS device could be at as much risk as data collected over the web. The cost of re-engineering all data warehouses in the retail industry to conform with the EU directive, or even a U.S. variant, would be staggering.
Retailers use personal data for target marketing and data mining.
They have a very skittish view of direct marketing as it exists here in the states. At the heart of the problem, according to Duncan, are two very different historical approaches to privacy. Here, businesses and citizens want as little government interaction as possible, preferring self-regulation. If you're a retailer who doesn't ever deal with Europeans, you don't have to worry about this. But if you operate stores overseas and send data back to a central database in the United States, or if you're accepting orders from European shoppers via the Internet, this is going to affect you.