The operations of Facebook and many other US-based companies in Europe could be disrupted after a 15-year pact between the two regions was declared illegal.
Europe’s highest court on Tuesday ruled invalid the “Safe Harbor” agreement that governed the transatlantic transfer of data on European citizens. Reached in 2000 by the European Commission and US authorities, it allowed companies to send user data to the US without guaranteeing that the information would be protected from the eyes of the US government.
More than 4,000 US companies, including Apple, Google, Microsoft and Yahoo, that transfer user data out of the continent will be affected by the ruling. Having relied on the arrangement to do business since some of them were in their infancy, the affected companies will now need to draw up individual and complex contracts, each of which will require negotiations over the protection of user data. While some companies may have seen the ruling coming and started putting provisions in place, the verdict was delivered much more swiftly than anticipated.
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