15 March 2000

U.S., European Union Agree on "Safe Harbor" for Data Privacy

Washington, D.C. -- The United States and the European Union agreed March 14 to a "safe harbor" system that will allow data flow between America and the EU while ensuring protection for the personal information of EU citizens.

The U.S. International Trade Administration (ITA) announced the arrangement in a press release.

Under the arrangement, U.S. organizations voluntarily agree to adhere to principles that bridge the gap between U.S. and EU systems for governing data privacy.

U.S. Commerce Secretary William Daley said the arrangement "demonstrates that both the EU and the U.S. recognize that a carefully constructed and well-implemented system of self-regulation can protect privacy rights. I believe it also has important implications for developing self-regulatory models that could be useful in other areas."

He added that the arrangement "comes none too soon" to support the growth of the U.S.-EU trade and investment relationship, particularly in the business-to-business and retailing e-commerce sectors.

Daley praised Under Secretary of Commerce for International Trade David Aaron, and his EC counterpart, Director General John Mogg, for their efforts to conclude the arrangement. He urged the EU member states and the EU Parliament to complete their review of the arrangement and provide their consent by the early June U.S.-EU Summit. Their approval is necessary to finalize the arrangement and begin its implementation.

Following is the text of the ITA press release:

(begin text)

U.S. INTERNATIONAL TRADE ADMINISTRATION

March 14, 2000

Washington, D.C. -- U.S. Secretary of Commerce William E. Daley announced that the U.S. Department of Commerce and the European Commission today reached an arrangement on a safe harbor system which will allow continuing data flows between the U.S. and the EU and ensure privacy protection for EU citizens' personal information. Under the arrangement, U.S. organizations voluntarily agree to adhere to "safe harbor" principles which bridge the gap between the U.S. and EU systems for governing privacy.

"This Administration places the highest priority on the protection of consumer privacy while expanding business opportunities," Secretary Daley stated. "The arrangement demonstrates that both the EU and the US recognize that a carefully constructed and well-implemented system of self-regulation, as advocated by the President and the Vice President, can protect privacy rights. I believe it also has important implications for developing self-regulatory models that could be useful in other areas."

"This data privacy success comes none too soon to support the growth of the almost 2 trillion dollar [2 million million dollar] U.S.-EU trade and investment relationship, particularly in the rapidly growing business-to-business and retailing e-commerce sectors," Secretary Daley said.

Secretary Daley praised Under Secretary of Commerce for International Trade David Aaron, and his EC counterpart, Director General John Mogg, for their efforts to conclude this arrangement. He urged the EU member states and the EU Parliament to complete their review of the arrangement and provide their consent by the early June U.S.-EU Summit. Approval from the EU member states and the EU Parliament is necessary to finalize the arrangement and begin its implementation.

On the issue of financial services, both sides recognize the economic importance of this sector and have agreed to continue their discussions on a priority basis in order to provide the benefits of the "safe harbor" principles in the context of U.S. laws and regulations.

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