BRUSSELS — January 10, 2017 — BSA takes note of the Commission’s communication on how to ‘Build a European Data Economy’ which was published earlier today, focusing on the free flow of data and the so-called ‘emerging issues.’

The Commission’s decision to scale back on its ambition of safeguarding the free movement of data in the EU through bespoke legislation is unfortunate. However, we remain hopeful that legally binding rules banning data localization will be introduced in the coming months. In an increasingly data-driven economy in which most business sectors rely on the cross-border transfer of data, unrestricted data flows are an absolute prerequisite for the completion of the EU’s Single Market. Therefore we urge the EU to enact stronger rules so that it can also engage with its international trading partners to seek similar discipline, which is indispensable for growth in the digital economy.

The Commission is also trying to determine whether market distortions are present in specific areas such as data portability, data access, and ownership, and liability.” However, and while outlining the need to gather actual evidence of market failure and launch a public consultation, the Commission is already delineating potential policy options in those areas for upcoming legislative action. “We are puzzled by the fact that the Commission is trying to establish the need for regulatory action where, to this day, there are no proven market distortions”, said Thomas Boué, BSA Director General, Policy – EMEA.

“If there is indeed a need for preemptive action at the EU level, the Commission should focus on data localization which, if left unchecked, could have structural implications for the EU single market and European competitiveness,” he concluded.