The main objectives of the future European Data Law

The European Commission published on February 23, 2022 a legislative proposal for a European Data Law. A law that aims to guarantee fairness in how the value of data use is shared between companies, consumers and public bodies; and facilitate data access and use. In this context, the legislation on the legal protection of databases is reviewed, seeking the appropriate balance between data access rights and the incentives to invest in them, without changing the current data protection legislation.

This proposal for a European Data Law is currently being analyzed by different organizations, sectors and interest groups. For example, the European Digital SME Alliance, which represents European ICT SMEs, sent in May a series of suggestions for modification on different points of the bill. However, to be clear about how all this is going to affect organizations related, directly or indirectly, to the exploitation of data originating from connected products or services, we will have to wait for the final wording of the European Data Law.

From Seresco, a Spanish company specialized in technological solutions, they have compiled the changes that the new proposal for a European Data Law may entail, as well as the main objectives it pursues and its impact on the way in which companies, consumers and public bodies manage and extract value:

  1. Facilitate data access and use by consumers and businesses: data generated by the use of connected products or services must be accessible and manufacturers and service providers must not be the only parties that benefit from such data. Therefore, connected products and services should be designed to allow access to data by default, thus preserving incentives to invest in ways to create value through data.
  2. Ensuring FRAND conditions and fair stipulations in contracts: data owners must make data available on fair, reasonable and non-discriminatory (FRAND) terms, and based on reasonable compensation (costs for SMEs are subject to a cap). In addition, the Data Law restricts the use of abusive contractual clauses imposed unilaterally by the other party. The provisions on what is considered unfair are listed in the Data Law, but will not be binding. In support of fair terms in contracts, the Commission aims to develop non-binding model terms on data access and use.
  3. Facilitate the change of cloud service provider: providers of data processing services, including cloud service providers, must enable customers to more easily switch to another service provider. Barriers to change must be removed to allow contracting with new providers, transfer of data, applications and other assets, and maintenance of functionality to take place in less than 30 days. Providers may charge for the change.
  4. Prevent illegal data transfer: The mission of the European Data Law is to respond to concerns about illegal access to data by governments that do not belong to the EU or the European Economic Area (EEA), as well as to establish interoperability standards for the reuse of data. data between sectors, in an attempt to remove barriers to data sharing. In addition, it supports the establishment of standards for “smart contracts”, and contemplates open interoperability standards and specifications to transfer data between cloud and edge computing providers.
  5. Define rights on databases: To prevent the “sui generis” right on databases, under the Database Directive 96/9/EU, from being used as a justification for not sharing the data; the Data Law establishes that it does not apply in relation to data generated by the use of a connected product or related service.
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