A number of companies, including software giant SAP and German conglomerate Siemens, have joined US tech giants in criticizing a draft EU data law. This is reported by the Reuters news agency.
EU countries and lawmakers are currently working on the details of the EU Data Act proposed by the EU Commission last year before it becomes law. The law aims to improve data exchange between companies and with the public sector. According to the draft, public bodies will be able to access and use private sector data when necessary under “extraordinary circumstances”, such as natural disasters or to fulfill a legal mandate.
The bill is part of a series of legislation aimed at curtailing the power of big US tech corporations and helping the EU achieve its digital and green goals. The US criticizes, among other things, that the proposed law is too restrictive. European companies such as SAP or Siemens, on the other hand, complain that a provision that forces companies to share data with third parties could endanger trade secrets.
criticism of European companies
“There is a risk that European competitiveness will be undermined by requiring the sharing of data – including core know-how and design data – not only with the user but also with third parties”, quotes Reuters from a joint letter from European companies to Commission President Ursula von der Leyen, EU Cartel Office Chief Margrethe Vestager and EU Industry Chief Thierry Breton. “This could mean that EU companies have to share data with competitors from third countries, especially those who do not operate in Europe and against whom the protections of data law would be ineffective,” it said.
The signatories to the letter, which is dated May 4 and could be seen by Reuters, included the CEOs of SAP, Siemens, Siemens Healthineers, German medical technology company Brainlab, German software company DATEV and lobby group Digitaleurope.
The letter calls for safeguards that allow companies to refuse data sharing requests where trade secrets, cybersecurity, health and safety are at risk. Nor should the scope of the devices covered by the legislation be extended.
Response of the EU Commission
The EU Commission has acknowledged receipt of the letter, according to Reuters, saying it understands the importance of trade secrets but companies should not use them as an excuse. “The Data Act does not seek to change European or national law on trade secrets. However, it is important that trade secrets are not used as an excuse for not sharing data,” said Johannes Bahrke, Coordinating Spokesperson for Digital Economy, Research and Innovation at the European Commission, at a press conference. “We have to find a balance here. And that’s what we’re trying to achieve with the data law proposal. There are safeguards, that is, contractual and technical safeguards that are laid down in the data law,” he said.
With regard to a provision in the bill that would allow customers to switch between different cloud providers, the companies believe that legislation should preserve contractual freedom by allowing customers and providers to agree on contracts, that work best for each business case.
It was not until the end of March that the EU Council of Ministers approved the planned data law in principle, but called for stronger protection of business secrets and clearer definitions. The European Parliament had previously decided its position on the EU Commission’s draft law with a large majority. The coming weeks will show whether and to what extent the letters from the companies will influence the negotiations on a final version of the law.
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