Transborder Data Flow:

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Transborder Data Flow EU Directive and
Implications for International Business
Elizabeth Longworth Privacy Consultant and
Lawyer New Zealand
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What is transborder data flow?

• outsourced data processing
• human resources records
• banking, insurance, credit
• marketing to prospects and customers
• travel reservations
• law enforcement, customs, tax

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The knowledge economy leverages off the use of
information
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The use of information

• ICT capacity and sophistication
• globalisation
• high volume, widespread data transfer

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EU Privacy Directive (1995)

• sets privacy standards
• mandatory export restriction
• implemented in EU Members laws
• adequacy requirement (Articles 25 26)

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EU adequacy requirement

• no data transfer to third country unless adequate
  privacy protection
• Depends on substantive rules and procedures in
  third country
• can be ad hoc and contractual mechanisms

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Adequacy means

• compliance with the privacy rules
• support and help for data subjects
• appropriate reddress

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Tbdf contracts

• need for EC approval
• model or standard contract clauses
• provisions must satisfy criteria

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On-line tbdf

• C2B interactions
• problems with contractual analysis
• significance of privacy policies

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Jurisdictional issues

• choice of law
• interim relief
• enforcement
• the law of the supplier (e-com) versus the
  domicile of the consumer

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Business implications

• information as the key resource of the knowledge
  economy
• reliance on continued access to categories of
  personal data
• costs and complexity of satisfying adequacy tests
  (if no privacy laws)
• economies, efficiency, confidence and trust

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Transborder Data Flow EU Directive and
Implications for International Business
Elizabeth Longworth longworth_at_attglobal.net