11 July 2000

Members of the European Parliament have rejected the data privacy agreement reached by EU and American officials after months of often terse negotiations.

The agreement was heavily criticised by Parliament’s legal affairs committee on the grounds that there had been insufficient consultation with interested parties, many of whom were concerned that the deal ceded undue freedom to US companies in the handling of European consumer data.

Following the committee’s narrow vote to reject the so-called "safe harbour" agreement, its decision was ratified by MEPs. Although Parliament's ruling is not binding on the European Commission, it is unlikely to be ignored and will almost certainly necessitate a resumption of Euro-US negotiations. Had it been adopted, the "safe harbour" agreement would allow US companies to process data from the EU provided they complied with a detailed set of rules.

Alistair Tempest, FEDMA director-general sees Parliament’s rejection as "a major set back for a common approach to data privacy which is regrettable in these days of global E-commerce."

News source: Precision Marketing (UK)