Ireland: Privacy Shield, Revealed: A Look At The Proposed Replacement Of Safe Harbor

Since 6 October 2015 when the Court of Justice of the European Union ("CJEU") found that Safe Harbor was invalid, organisations which operate across the United States and the European Economic Area ("EEA") have been in an uncertain position when it comes to data transfers. Many hoped for a replacement to Safe Harbor. The Article 29 Working Party (the collective group of European data protection authorities, or "DPAs") indicated that no general enforcement action would be taken until the end of January 2016. This gave organisations some welcome breathing space to put in place alternative measures to legitimise data transfers to the United States. However, it also put pressure on the Commission to finalise a replacement data transfer scheme with the United States, which had been under negotiation for two years. On 2 February 2016, the Commission delivered – announcing the Privacy Shield, the replacement of Safe Harbor.

Since then, we have been waiting for the details, and on 29 February 2016, the Commission released an extensive set of documents, which set out how the Privacy Shield will operate. In this post, we look at some of the key issues relating to the Privacy Shield.

When will the Privacy Shield come into effect?

The Privacy Shield, while agreed in principle with the United States, must still be formally adopted as a matter of EU law, as a Commission Decision. The Commission is aiming for adoption in June 2016. However, before that can take place, the current draft decision must go through a procedure known as "comitology". This involves a series of steps:

  1. Review by the Article 29 Working Party and the European Data Protection Supervisor: The Article 29 Working Party released a statement on 29 February welcoming the Commission's publication of the draft decision and related texts, and indicating its intention to adopt an opinion on its analysis of the documents in mid-April.
  2. Examination by Member State Committee: Next, a committee made up of representatives of each EU Member State will consider the draft decision. The decision must be approved by a qualified majority of the committee.
  3. Adoption of the Decision by the Commission: Once the draft decision has been through this procedure, the Commission may adopt the decision formally, and it will become effective.

However, there a number of roadblocks that could derail or lengthen this process. First, at any time during the comitology procedure, the European Parliament or Council could ask the Commission to maintain, amend or withdraw the draft decision. Second, either a Member State, the Council, or the European Parliament could seek to refer the draft Privacy Shield decision to the CJEU. The most likely candidate would appear to be the European Parliament. There is precedent for the European Parliament challenging a Commission data protection adequacy decision in a similar manner – in 2006, it successfully challenged the Commission Decision on the disclosure of Passenger Name Records before the CJEU ( Cases C-317/04 and C-318/04).  

How will the Privacy Shield work?

As with the now defunct Safe Harbor, the Privacy Shield will be a self-certification scheme for US businesses, which will allow them to receive data from the EEA. The substance of the Privacy Shield is very similar to that of Safe Harbor. This is helpful for businesses which are already certified under or familiar with the Safe Harbor scheme, as the learning curve will not be too steep.

As with the Safe Harbor scheme, the Privacy Shield decision is based on US organisations complying with seven key "Principles". When personal data is treated in accordance with these Principles, the Commission's draft Privacy Shield decision provides that such personal data enjoys "adequate" protection in the US, within the meaning of the Data Protection Directive. In other words, transfers to US members of the Privacy Shield scheme would be legitimate under EU data protection law.

The Privacy Shield Principles are as follows:

  1. Notice: The certified organisation must provide information to individuals on 13 items, including its participation in the Privacy Shield, the types of data collected, the purposes for which the data is collected and used, the requirement to disclose personal information in response to lawful requests by public authorities and the designated dispute resolution body.
  2. Choice: Individuals must be able to opt-out of the disclosure of their data to a third party and the use of their data for a new, materially different purpose to the original purpose.
  3. Accountability for onward transfer: For onward transfers to a third party controller, organisations are required to enter into certain contracts, and are constrained in their ability to engage in onward transfers.
  4. Security: Organisations are obliged to take reasonable and appropriate data security measures.
  5. Data Integrity and Purpose Limitation: Organisations can only process personal information in a way which is compatible with the purposes for which it was collected or authorised by the individual subject.
  6. Access: Individuals must be able to access their personal information from certified organisations.
  7. Recourse, enforcement and liability: The Privacy Shield scheme creates a series of recourse mechanisms, to which organisations will be subject, including enforcement by the Department of Commerce and independent authorities such as the Federal Trade Commission, arbitration of disputes, the creation of an Ombudsperson, and investigation by a panel of European DPAs.

There are also supplemental principles dealing with a number of issues, including sensitive data, journalistic exemptions, performing due diligence and audits, the role of EU DPAs, the right of access, human resources data, the obligatory contracts for onward transfers and dispute resolution and enforcement.

The Privacy Shield is a self-certification scheme – organisations will self-certify by making a submission to the US Department of Commerce. These submissions must be made annually.  The Department of Commerce will maintain a list of the certified organisations on its website. Organisations are required to provide follow-up procedures to verify their compliance with the Principles, either through self-assessment or outside compliance reviews.

Will the Privacy Shield pass the CJEU's test?

For the Privacy Shield to become an effective and practical tool for businesses, it will need to meet the requirements set out in the CJEU's decision in Schrems v Data Protection Commissioner, which invalidated Safe Harbor.  

At the heart of the debate, and the CJEU's decision, are a series of competing interests: the privacy of the individual, the desire to encourage the free flow of data across borders in the interest of trade, and the national security interests of sovereign states. The Safe Harbor scheme was not seen as appropriately balancing these interests. Four issues are central to assessing the Privacy Shield's prospects for survival and whether it strikes an appropriate balance.

  1. US law and surveillance practices: While the CJEU did not make a specific finding as to US law, a lot of the scrutiny which Safe Harbor attracted related to the surveillance practices of the US government, and, in particular, allegations of mass surveillance. Much of the documentation released by the Commission on Monday relates to US law and practices, including letters from the US Secretary of State, the US Office of the Director of National Intelligence and the Criminal Division of the US Department of Justice. These documents should result in a more balanced debate around surveillance practices and, no doubt, will be carefully scrutinised by the stakeholders in the comitology process.
  2. The powers of EU DPAs: The judgment in Schrems emphasised the CJEU's concerns with Commission Decisions that constrained EU DPAs in the exercise of their powers. While new enforcement mechanisms are being created under the Privacy Shield, it appears that the focus is on using US enforcement mechanisms. However, the de facto bar on EU DPAs investigating complaints and prohibiting data transfers that seemed to operate under Safe Harbor, and which was criticised by the CJEU, is less evident under the Privacy Shield. Where EU DPAs seek to investigate certified organisations, those organisations are bound to cooperate.
  3. Individual redress: While not explicitly called out by the CJEU in the Schrems judgment, the possibility for individuals to bring actions or complaints to protect their own interests is seen as a key safeguard of the right to privacy. The Privacy Shield attempts to develop new ways to allow individuals to protect their rights which is augmented by the new US Judicial Redress Act.
  4. Oversight: Safe Harbor was adopted in 2000, in a world before cloud computing and the growth of digital state surveillance driven by anti-terrorism initiatives. After 15 years, it was creaking with age, and seen as ill-equipped to deal with current data transfers. In order to ensure that the Privacy Shield continues to operate as intended, it contains in-built oversight. The Commission will be keeping the Privacy Shield scheme under review annually, meeting and producing a joint annual review report with the Department of Commerce and the Federal Trade Commission. Critically, EU DPAs will be able to participate in these meetings. The draft decision also contains a process for suspension of the Privacy Shield, in certain circumstances where the protection of EU citizens is threatened.  

Ultimately, whether the Privacy Shield survives the adoption process, and potential future challenges by private litigation, remains to be seen. In many ways, it will be shaped in the coming months as it moves through the adoption procedure, and as various stakeholders have their opportunity to comment. The stakes are high – every business which operates across the Atlantic Ocean and every citizen in the EEA with an internet connection has an interest in the outcome. We will have to wait to see where the chips will fall. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions