However, the two sides have agreed to a “safe harbour principle” under which US firms which opted to comply with the EU data protection rules would not be affected by any embargo.
The proposal should create a more predictable and less complicated framework for EU data controllers needing to transfer data to the US.
It should also result in improved protection for data flowing to the US. In addition, guidance will be provided to companies and other organisations in the US wanting to meet the “adequate protection” standard.
The agreement has yet to go through all the stages of approval which are necessary for it to take effect. A spokesman for the European Commission said that the process is likely to be completed in July.
The Commission spokesman added, “We hope the Commission will be able to adopt a formal decision recognising that the safe harbour offers adequate protection to data being transferred to participating companies in the United States normally at the beginning of July.”
The member states “overwhelmingly” approved the terms of the safe harbour arrangement in Wednesday’s vote. There had been expectations that Italy, Spain and Austria would vote against it because of continuing doubts about whether US firms would actually comply with the EU law.