U.S. Firms Get Privacy Lessons from Europe

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While big online names such as Yahoo, Google or Facebook are part of the Safe Harbour scheme, most US air carriers are not.

"Nobody from the air sector is in Safe Harbour: Delta (DAL), American Airlines (AMR), none of them are. When you give them the information in Europe, I am sure beyond any doubt that the information goes to Atlanta (US)," Edward Janger from Brooklyn Law School said.

He pointed to the fact that these companies are subject to EU law if their branches operate on European soil, but that there is little scrutiny of their responsibilities. "I don't know of any EU audit on whether these companies have adequate data protection," he said.

Swift agreement

One company which is part of the Safe Harbour agreement is Swift, the Belgian-based financial communications company handling some 80 percent of the world's international bank transactions.

Ms Sotto's legal firm has helped Swift comply with EU data protection laws, despite its image being seriously dented by the scandal which broke out in 2006, when it emerged that the US government was secretly tapping into the company's data as part of an anti-terrorism program.

"We helped Swift solely with the Safe Harbour certification, not the law enforcement side. From my perspective, it was a whole bunch of nonsense. The data was being transferred in a secure way. They just put a legal framework around it, which is fine, but it cost a lot of money in legal fees," she said, in reference to the years of legal wrangling with the EU.

The Swift saga seems to be nearing its end, however, as the EU and the US on Monday (28 June) formally put their signatures on a legal agreement likely to be approved by the European Parliament next week after gaining some extra layers of auditing and control over the program.

Back in February, the legislature rejected an interim deal, citing privacy concerns and an inter-institutional quarrel. The veto interrupted the data flow from Swift's European server to the US authorities, triggering concerns in Washington at the "security gap" created thereby.

If the deal wins the approval of Parliament next week, Swift will resume sending data on 1 August, including for the months lapsed since February.

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