Europe Delays Privacy Deadline

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October 26, 1998 (2:47 PM EST)

By Mary Mosquera,

WASHINGTON, D.C. -- A European Union data-privacy policy that could have interrupted transatlantic business has been delayed until December, a senior Clinton administration official said Monday.

The European Union's Directive on Data Protection, which regulates how personal data is collected and secured, went into effect Sunday. The directive was designed to restrict the flow of personal data between Europe and countries that do not meet its standards of data-privacy protection, including the United States.

But consultations between EU and U.S. officials led to a postponement of that deadline until Dec. 15, said David Aaron, the Commerce Undersecretary for International Trade.

There are two main stumbling blocks the United States must overcome before the European Union will recognize the United States' data-privacy policy: Consumers' ability to amend incorrect personal information and enforcement of privacy guidelines.

The most promising solution is that Europe recognize a "safe harbor" for U.S. businesses that have privacy principles and adhere to them, Aaron said. But others believe the United States won't have an adequate policy in place by December. "All we're getting is extensions," said Marc Rotenberg, director of the Electronic Privacy Information Center. "The U.S. has a hard sell for Europe that privacy protection in the U.S. is adequate when few people in U.S. think it is adequate."

Aaron said the Clinton administration's privacy policy is simply different, not worse, than the European policy, because its historical experience. "Europeans believe they have a fundamental right to data privacy; in the United States, the Supreme Court decides on privacy cases every year," Aaron said.

While the European Union expects countries to legislate their privacy policies, the United States uses a combination of self-regulation, existing regulations, and fraud statutes. The Clinton administration has said it prefers the private sector regulate itself, but has promised to legislate the issue if the private sector doesn't institute and enforce its own privacy programs.

Even with the delay, national governments have the right to bring complaints against the U.S. "I think we're in overtime and the U.S. doesn't have a workable policy yet," Rotenberg said. "It will take time, at least through the next session of Congress, to deal with privacy issues and establish rights enforceable by law."

Europe adopted the privacy directive three years ago and had given other governments until Oct. 25 to craft national privacy policies. Only Portugal and Greece are in complete compliance with the European privacy directive, the European Union said.