EU Legal Opinion on Facebook Case Spells Trouble for Data Transfers

Companies, including US tech giants, should be blocked from transferring European users’ data in some cases if they can’t guarantee it will be handled in compliance with European Union privacy laws, an adviser to the EU’s top court recommended. The recommendation, if followed by the EU’s Court of Justice, could unleash a series of legal challenges against companies which have significant operations in the US and Europe—potentially disrupting their operations. many companies currently transfer data out of Europe under several different legal tools that generally require them to comply with EU privacy principles overseas. In a relief for many businesses, Henrik Saugmandsgaard Øe, an advocate general for the court, said judges shouldn’t strike down one of the more popular legal tools, called standard contractual clauses. But he argued that data-protection authorities should nevertheless block specific transfers made using the clauses when other countries required companies to ignore them.