Azernews.Az

By Bloomberg

The European Union is backtracking from plans to allow U.S. Internet giants to be regulated by a single data privacy watchdog in the EU, threatening the so- called one-stop-shop backed by Google Inc. to Facebook Inc.

Amid a turf war over who gets to regulate some of the world’s biggest companies, justice ministers have dropped proposals to give sole power to regulators where companies have their EU headquarters. Under a compromise plan being discussed by justice ministers in Brussels today, powers would be spread out, giving other nations the right to veto decisions taken by the lead authority.

“The proposal effectively allows each authority to exercise a veto over the decision of the lead authority,” said Wes Himes, a director at the European Digital Media Association, whose members include Google, Facebook and Microsoft Corp. “All we want is one decision, one outcome.”

With U.S. companies such as Facebook, Apple Inc., and LinkedIn Corp. having Ireland as their main European base for data-protection purposes, policing privacy violations already resembles a battle between David and Goliath for thinly staffed agencies in some of the EU’s smallest nations.

Countries including France opposed earlier plans for the one-stop-shop, calling for more power on how such companies are regulated.

Cross-Border Cases

The latest proposals on how to revamp the EU’s 19-year-old data privacy law would make changes putting all watchdogs “concerned” in charge of deciding on cases affecting more than one country. The new mechanism would apply in “important cross- border cases” and oblige the lead data agency to come to a decision jointly with other EU regulators.

“If after a few weeks or a month, let’s say, there are no major objections by a decision from the lead authority, it will be assumed adopted by all of the regulators,” said Edouard Geffray, secretary general of France’s data regulator, CNIL. “This refutes any criticism that the proposed system would lead to long delays. It would lead to a rather efficient system.”

Facebook and Microsoft declined to comment, while Google representatives didn’t immediately respond to requests for comment.

The EU’s former justice chief Viviane Reding heralded the one-stop-shop as a way to simplify procedures for companies and citizens alike when she proposed the revamping of the bloc’s privacy law in January 2012.

“We believe in a lead data protection authority and a pure one-stop-shop system,” said Himes. The alternative is a “convoluted process of multi-consultation, multi-decision making.”

Having to seek feedback and get the green light of all regulators concerned would lead to a “paralysis,” said Gerard Lommel, head of the Luxembourg privacy watchdog until last month.