In the United States, our hope is that a global framework for national privacy policies will emerge that protects consumers, encourages innovation, and supports trade and economic growth. Both the US and the EU must take care to preserve the free flow of data that supports one of the most significant trade relationships in the world. Otherwise, our good intention to protect privacy could hinder the economic growth that both sides need.
In his first term, US President Barack Obama laid out a comprehensive privacy blueprint entitled ‘consumer privacy in a networked world'. Now, with the president entering his second term, the US has an opportunity to take steps to implement that strategy. This strategy emphasises the importance of finding ways to make its framework for privacy policy inter-operable with those of other countries – not identical but compatible, based on common principles and comparable protection. The US-EU ‘Safe Harbour' framework is an example of a flexible mechanism that enables this kind of interoperability. During my trip to Brussels in October, I was encouraged that, even though the EU is still reviewing its privacy framework, Viviane Reding, the European justice commissioner, was able to say that “Safe Harbour will stay”.
The value of this mechanism cannot be overstated. Developed jointly by the US Department of Commerce and the European Commission and launched in 2000, Safe Harbour provides US companies with a streamlined way to comply with the EU's data-protection directive. Its success was recognised in March when the US and the EU reaffirmed their commitment to it.
Safe Harbour has helped US companies – both large and small – provide effective consumer protection while enabling them to do business in Europe. More than 60% of companies that use the Safe Harbour mechanism are small and medium-sized enterprises; the low cost of participation makes it accessible to even the smallest companies.
Companies must renew their participation annually; the process acts as a regular reminder of their commitments. These commitments to protect personal information are enforceable by the Federal Trade Commission (FTC), and active enforcement has been critical to the Safe Harbour's success. Recent FTC settlements reached with Google, Facebook and Myspace show that companies are held accountable for the commitments they make.
The US Commerce Department and the European Commission are continuing efforts to enhance the Safe Harbour framework and co-operation on privacy issues. Even greater interaction is likely during President Obama's second term.
The US and EU privacy regimes differ because their legal systems and political structures are distinct, but our values are similar. The ‘fair information practices principles' that informed the EU's privacy directive originated in a US government report in the 1970s. These principles are also the foundation of the Obama administration's consumer privacy bill of rights.
The US and the EU ultimately share the same goals – to protect privacy and facilitate trade and economic growth. With President Obama's re-election and reviews of privacy frameworks under way on both sides of the Atlantic, we are now at an important crossroad. The US and the EU have an opportunity to take steps that will help shape the global privacy landscape and our trade and economic relationship.
Cameron Kerry is the general counsel of the US department of commerce in Washington, DC.
