Most people in the United States have wished for more privacy of personal data; they receive mailings, solicitations, and other information about themselves that make them wonder where that source acquired the personal information. Not so in Europe. In fact, the Europeans are determined that they won't get on any unwanted mailing list from the United States or elsewhere. As of October 25, 1998, when the European Union Directive on Data Protection went into effect, commissioners in Brussels have resolved to prosecute companies and block Websites that fail to live up to Europe's standards on data privacy. The directive guarantees European citizens absolute control over data concerning them. A U.S. company wanting personal information must get permission from that person and explain what the information will be used for; the company must also guarantee that the information won't be used for anything else without the person's consent. EU citizens have the right, under this directive, to file suits against a company if they feel it is abusing their private data.
Such protections seem admirable, but free marketers across the ocean are worried about the prospect of Europe being able to regulate the computer databases and the Internet, which are vital to the information economy. They feel that regulations should be agreed upon for a global system. It is a stalemate situation of protection of privacy versus freedom of information, which is protected by the First Amendment in the United States. At the heart of the standoff is a basic cultural difference: Europeans trust their governments over companies, whereas in the United States, it is the opposite. Already, European inspectors travel to Sioux City, South Pakota, to Citigroup's giant data processing center, where computers store financial information about millions of German credit card holders, to make sure that Citigroup is complying with the privacy data protection law. Citigroup accepted the supervision as a condition to market a credit card in. Germany.
U,S. companies are concerned that the EU directive will force them to establish separate data networks for Europe, making it impossible to conduct business as usual with EU member countries. The privacy rules are already having an effect-prohibiting U.S. airlines and hotels, for example, from storing information about their clients that they would normally use to provide better service for them. Third parties to business transactions, such as FedEx delivering a package across the ocean, could also be held responsible. Thqre is considerable concern that the EU directive will imperil the future of electronic commerce.
The question of protection of export of private data is but one of the complexities brought about by the use of technology in international business. For now, on your next trip to Europe, bringing back the contact information that you entered on your laptop computer is illegal!
In 2001, some agreement between the EU and the U.S. had been reached on safe harbor principles allowing transfer of data. However one still must convince authorities in each country that the data was obtained lawfully and that you have sufficient'security provisions for that data.
EU lmposes Cross-Border Electronic Data privacy : Managing Interdependence article from Global Management Catagory EU lmposes Cross-Border Electronic Data privacy
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