Source: https://www.jdsupra.com/legalnews/chapter-13-cross-border-data-transfers-99090/
Timestamp: 2019-05-25 02:01:23
Document Index: 343470123

Matched Legal Cases: ['CJEU ', 'Art.4', 'Art.47', 'Art.47', 'Art.45', 'Art.48']

Chapter 13: Cross-Border Data Transfers – Unlocking the EU General Data Protection Regulation | White & Case LLP - JDSupra
This issue affects all organisations that engage in Cross-Border Data Transfers. For example, organisations using online IT services, cloud-based services, remote access services or global HR databases—among others—will often need to implement lawful data transfer mechanisms.
In order to ensure compliance with the requirements of the GDPR, organisations should:
Cross-Border Data Transfers were, without prejudice to compliance with national law, prohibited, unless the transfer was made to an Adequate Jurisdiction (see below) or the data exporter had implemented a lawful data transfer mechanism (or an exemption or derogation applied).
Cross-Border Data Transfers to a recipient in a third country could take place if the third country ensured an adequate level of data protection. Adequacy was assessed in the light of all circumstances surrounding the transfer, in particular:
The Commission could determine third countries to be Adequate Jurisdictions.
Adequacy Decisions adopted by the Commission on the basis of the Directive remain in force until amended, replaced or repealed in accordance with the GDPR.
The Directive did not directly address the need to review Adequacy Decisions. The CJEU in Schrems determined that DPAs can examine claims that an Adequacy Decision provides insufficient protection for transferred personal data.
Adequacy Decisions are subject to a periodic review, at least every four years, taking into account all relevant developments. The Commission can repeal, amend or suspend Adequacy Decisions for jurisdictions no longer ensuring an adequate level of data protection (without retroactive effect).
Adequacy Decisions made under the GDPR remain valid for a maximum of four years and may be amended, suspended or repealed. This may affect the ability of organisations to rely on Adequacy Decisions in the long-term.
The Directive did not specifically provide for binding agreements between public authorities or bodies as a lawful basis for Cross-Border Data Transfers.
The Directive did not specifically address BCRs. However, it permitted Member States to authorise data transfers where the controller has adduced adequate protections for the transferred data. BCRs being one such measure. Much of the guidance on the requirements for BCRs under the Directive comes from WP29 working papers (see, in particular, working papers 74, 107, 108, 133, 153, 154, 155, 195, 195a, 204 and 212) and from guidance issued by DPAs in certain Member States.
Rec.108, 110; Art.4(20) 46(2)(b), 47; WP29 BCR Guidance (WP256, WP257)
Unlike the Directive, the GDPR explicitly recognises BCRs and provides clear provisions on requirements and procedures for BCRs. This is likely to make it easier for organisations to obtain DPA approval for, and implement, BCRs. The WP29 issued updated BCR guidance taking account of GDPR. This guidance provides assistance for BCR applicants in ensuring compliance with the requirements of GDPR.
The Directive did not specify requirements for the content of BCRs. The WP29 working papers noted above set out guidance on the content of BCRs. Certain general principles (e.g., the requirement to make the BCRs binding upon the members of the relevant corporate group) applied uniformly in all Member States. However, a number of other requirements were interpreted inconsistently from one DPA to another.
Rec.108, 110; Art.47(1)-(3); WP29 BCR Guidance (WP256, WP257)
confirm that the EU- based data exporters accept liability on behalf of the entire group;
The Directive did not discuss the requirements for approval of BCRs. A mutual recognition procedure applied in 21 Member States, and provided that the applicant must appoint a lead DPA to review the application for BCRs. Once the lead DPA approved the BCRs, that approval was recognised by those 21 Member States. However, for the remaining seven Member States, separate applications were required.
Rec.108, 110; Art.47(1), 57(1)(s) WP29 BCR Guidance (WP256, WP257)
Pre-existing approvals of BCRs created under the Directive remain valid until amended, replaced or repealed in accordance with the GDPR.
Cross-Border Data Transfers may take place on the basis of standard data protection clauses approved by the Commission ("Model Clauses").
Member States could authorise a Cross-Border Data Transfer where the controller adduced adequate safeguards in the form of Model Clauses. Under the Directive, several Member States required DPA notification or authorisation (or both) before Model Clauses could be used.
Model Clauses implemented under the Directive remain valid until amended, replaced or repealed in accordance with the GDPR.
The Directive did not provide for DPA Clauses as an adequate safeguard for Cross-Border Data Transfers.
Model Clauses are a well- known and proven concept; DPA Clauses might develop in a similar direction. However, it is unclear how this will work in practice. The Commission needs to approve DPA Clauses which, in theory, will prevent organisations from forum-shopping.
The Directive encouraged the drawing up of Codes of Conduct. However, it did not specifically permit Cross- Border Data Transfers to be made on the basis of a Code of Conduct.
The Directive did not provide for certifications as a mechanism for Cross-Border Data Transfers.
A Cross-Border Data Transfer could take place on the basis of ad hoc clauses between the data exporter and data importer. These clauses had to conform to the requirements of the national laws of the relevant Member State, and required approval from the relevant DPA, before transfers could begin.
The GDPR permits Cross-Border Data Transfers made on the basis of ad hoc clauses (as did the Directive).
Pre-existing DPA approvals of ad hoc clauses remain valid until amended, replaced or repealed in accordance with the GDPR.
The Directive did not provide for administrative arrangements as a lawful basis for Cross-Border Data Transfers.
The Directive did not directly mention third country court judgments or administrative authority decisions as a lawful data transfer mechanism.
A judgment from a third country, requiring a Cross- Border Data Transfer, only provides a lawful basis for such a transfer if the transfer is based on an appropriate international agreement, such as a Mutual Legal Assistance Treaty. However, this is without prejudice to other grounds for a transfer.
This requirement may result in organisations being unable to comply with orders from courts in third countries (e.g., the US) without the existence of an appropriate international agreement. If no such agreement exists, the transfer may nevertheless be lawful if the conditions of Art.45, 46, 47 or 48 are met. However, it should be noted that the UK has effectively opted out of Art.48 of the GDPR, on the basis of Protocol 21 to the Treaty on European Union and the Treaty on the Functioning of the European Union.
A Cross-Border Data Transfer could be made on the basis of the data subject's unambiguous consent. Any such transfers could only be carried out in full compliance with the applicable national laws that implemented the Directive.
A Cross-Border Data Transfer could take place if the transfer was necessary for:
the implementation of pre contractual measures taken in response to the data subject's request.
the implementation of pre-contractual measures taken in response to the data subject's request.
The position as it was under the Directive is essentially unchanged under the GDPR.
A Cross-Border Data Transfer could take place if the transfer was necessary for the conclusion or performance of a contract between the controller and a third party, which was in the interests of the data subject.
A Cross-Border Data Transfer could take place if the transfer was necessary, or legally required, on important public interest grounds.
The changes introduced by the GDPR make little practical difference, because interests that are not recognised by EU or Member State law are unlikely to be viewed by DPAs as a lawful basis for a Cross-Border Data Transfer.
A Cross-Border Data Transfer could take place if the transfer was necessary, or legally required, on important public interest grounds for the establishment, exercise or defence of legal claims.
A Cross-Border Data Transfer could take place if the transfer was necessary in order to protect the vital interests of the data subject.
Extending the scope of this ground to cover third parties provides organisations with another lawful basis for Cross- Border Data Transfers, albeit in limited circumstances.
In reality, very few organisations will ever make use of this basis for Cross- Border Data Transfers, as this basis only justifies transfers in a "life-or-death" situation.
A Cross-Border Data Transfer could take place if the transferred data were taken from a register which was open to the public, or to any person who could demonstrate a legitimate interest in inspecting it.
The position as it was under the Directive is, for the most part, unchanged under the GDPR.
The Directive did not allow for Cross-Border Data Transfers to be made on the basis of the controller's legitimate interests.
The GDPR introduces the possibility that organisations may be able to make Cross- Border Data Transfers on the basis of compelling legitimate interests. Even if the scope of this transfer mechanism is narrow, it provides for another option to enable Cross-Border Data Transfers.
The Directive did not provide for the possibility of limiting lawful data transfer mechanisms in this way.
EU law or law of the Member States may, for important reasons of public interest, expressly limit Cross– Border Data Transfers relating to specific categories of personal data. Member States must notify such restrictions to the Commission.
The GDPR maintains the pre- existing data transfer mechanisms created under the Directive (with some minor amendments). It also creates a number of new transfer mechanisms, of which organisations should be aware. Key changes from the Directive include the following:
Under the GDPR, several transfer mechanisms no longer require notification to, and/ or authorisation from, DPAs. This significantly reduces the administrative burden on organisations.
The GDPR introduces several new transfer mechanisms, including DPA Clauses, certifications and a derogation for the purposes of legitimate interests.
However, there remains a significant amount of uncertainty in this area, including in relation to the EU-US Privacy Shield, which is likely to face both political and legal challenges.
Following the decision in Schrems, the Commission and the US FTC formally agreed to the implementation of the EU-US Privacy Shield, which effectively replaces Safe Harbor. The final version of the deal features a number of amendments, mainly to address concerns raised by WP29 and the European Parliament. The most important changes include:
Chapter 16: Remedies and sanctions – Unlocking the EU General Data Protection Regulation
Chapter 15: Cooperation and consistency – Unlocking the EU General Data Protection Regulation