updated 2:28 PM CEST, May 24, 2023

BREAKING: U.S. and EU say they've agreed on a new privacy agreement, to replace 'Schrems II'

BREAKING: U.S. and EU say they've agreed on a new privacy agreement, to replace 'Schrems II' Court of Justice of the European Union

To the surprise of many businesses and observers across Europe, few of whom had seen it coming, U.S. and European Union officials said today that they had reached a preliminary agreement on a new data privacy deal, to replace the long-standing agreement that had been declared illegal in July, 2020 by the EU Court of Justice.

As this article was going to press, details were sketchy, and no formal document was yet believed to have been made public.

However, before noon Brussels time, such news websites as The Wall Street Journal and New York Times had posted stories describing how, as the WSJ put it, "President Biden gave a joint press statement with European Commission President Ursula von der Leyen in Brussels" earlier in the morning, during which they announced the deal.

Biden arrived in Brussels on Wednesday to attend an emergency NATO conference.

As the WSJ noted, the reported deal "could assuage concerns of companies with operations on both sides of the Atlantic," particularly tech companies like Meta Platforms and Alphabet Inc.'s Google, that had begun to face legal challenges about the way they routinely transfer data across the Atlantic. 

What remained unclear as of 3pm London time on Friday was what the new agreement would mean as far as the current and controversial practice of transferring large amounts of the personal data of EU citizens as well as expatriate Americans and dual citizens that is currently being transferred annually to the U.S. as part of the American tax evasion-prevention law known as FATCA. 

Such transfers have been the subject of repeated lawsuits, hearings and calls for investigations and change, as this and other publications have reported.

Indeed, as this morning's WSJ article noted, "officials and observers on both sides of the Atlantic expect any new agreement to be challenged in court again, raising uncertainty about how long Friday's deal will last."

While U.S. lawyers and lobbists have expressed optimism that the new deal would be able to withstand legal scrutiny, the article went on, some European critics said that "any deal that isn't coupled with changes to U.S. surveillance laws" would be "unlikely to pass muster with the EU's Court of Justice." 

In its closing paragraph, the WSJ article quoted Max Schrems, the Austrian lawyer and privacy activist who spearheaded the caes that struck down two earlier agreements between the U.S. and Europe (dubbed Safe Harbor and Privacy Shield) as having said on Twitter, ahead of the deal: "We had a purely 'political agreement' in 2015 too called #PrivacyShield – but it lacked basic legal underpinning and was dead on arrival." 

2020 ECJ ruling seen as 'potential game changer'

As reported, the July, 2020 European Court of Justice (ECJ) ruling that struck down the main mechanism then in use by the EU to protect the personal data of EU citizens when it's transferred to the U.S., was seen as representing a potential "game changer" for such data transfers, that would force the EU and U.S. to revisit the way non-U.S. financial institutions currently enforce FATCA, on behalf of the U.S. 

Since then, one of the most tireless campaigners over the issue of data privacy in Europe has been Filiippo Noseda, the Mishcon de Reya law firm partner who has been involved in a number of cases involving data privacy, including a widely-publicized, crowd-funded complaint about FATCA that was filed with the UK's Information Commissioner's Office in 2019.