The GDPR

Article 46 of the Regulation repeats and details the exception laid down in article 26 (2) of the Directive, if sufficient safeguards are provided by the controller or the processor and in the absence of a Commission decision finding an adequate level of protection. We should remember here that the controller or the processor is no longer required to appreciate this level. In the absence of such a decision, the conditions of such an exception must be met (or one of those provided for in Articles 47 and 49).

The final version of the Regulation supplements paragraph 1 of Article 46, adding that the transfer with appropriate safeguards is authorised only on condition that enforceable data subject rights and effective legal remedies for data subjects are available.

The implementation of the measures listed in article 46 (2) takes place without permission of the supervisory authority; it can be:

- by a legally binding and enforceable instrument between public authorities or bodies (a) or

- by binding corporate rules in accordance with Article 47. Recital 110 adds that these corporate rules must include the essential principles and the enforceable rights providing appropriate safeguards for the transfers or the categories of transfers of personal data or

- by standard data protection clauses adopted by the Commission (c) or jointly by a supervisory authority and by the Commission (d), or

- by a an approved code of conduct pursuant to Article 40 together with binding and enforceable commitments of the controller or processor in the third country to apply the appropriate safeguards, including as regards data subjects' rights (e).

- by an approved certification mechanism pursuant to Article 42 certifying the compliance of the processing with the rules of the Union (f)).

Paragraph 3 details other measures for which the prior authorization of the competent supervisory authority is required. In these cases, the supervisory authority must respect the consistency mechanism defined in Article 64, stipulating that the opinion of the European Data Protection Board must be required (see 64 (1), e)).

Subject to the authorization are:

- the contractual clauses that would not have been subject to prior adoption by the Commission or by a national supervisory authority, entered into between the controller or processor and the controller, processor or the recipient of the personal data in the third country or international organization (Art. 46 (3), a)) or

- provisions to be inserted into administrative arrangements between public authorities or bodies (Art. 46 (3), b)). The final version of the Regulation specifies that these arrangements should ensure the effectiveness of the rights granted to data subjects.

Lastly, Paragraph 5 states that the authorizations issued by a Member State or a supervisory authority pursuant to the Directive remain valid until their amendment, revision, or repealing by the same authority. The same applies to the decisions of the Commission taken pursuant to Article 26 (4) of the Directive.

The Directive

The Directive provided various exceptions to the prohibition of treatment resulting from the absence of an adequate level of protection.

One of them is laid down in Article 26 (2) and applies when the controller offers sufficient safeguards with respect to the protection of the privacy and fundamental rights of individuals, as well as with respect to the exercise of the corresponding rights and freedoms. This derogation implies that the controller shall have taken special measures to meet the shortfall in the level of protection of the country of destination of the personal data.

According to Article 26 (2) of the Directive, these appropriate safeguards may result from appropriate contractual clauses. Standard contractual terms have therefore been developed to regulate the transfers of data outside the EU by formalizing the protection rules contained in the Directive. Models were then adopted by the European Commission in accordance with Article 26 (4) of the Directive. In practice, this provision gave the Commission the power to find, by way of decision, that some standard contractual clauses offered sufficient safeguards, which then required the Member States to authorise the transfers based on these standard contractual clauses. The Commission decision should be adopted in accordance with the procedure laid down in Article 31, paragraph 2, providing for referral to the Committee under article 31 (see decisions 2001/497/EC 2002/16/EC; 2004/915/EC; 2010/87/EU).

An alternative to the standard contractual clauses has emerged since 2003: the internal corporate rules (called Binding Corporate Rules). Though initially sceptical, it was the Article 29 Working Party who developed this system in its working paper WP 74 of 3 June 2003  (working paper WP 74: Transfers of personal data to third countries pursuant to article 26 (2) of the Directive). It is a global and unique alternative that allows regulating all transfers of data within a group of undertakings, without systematically verifying the legal basis for the transfer (see the comments on Article 43 on the Binding Corporate Rules).

Potential issues

The new system is certainly clearer than the previous: safeguards need to be provided in the absence of a decision on adequacy by the Commission. The choice of safeguards is expanded and the national supervisory authorities will be able to intervene in a formalized procedure if the conventional safeguards cannot be implemented for reasons specific to the controller or the processor.

Of course, a specific difficulty would arise if the controller or the processor had considered, in the absence of official position of the Commission, that the recipient was located on a territory offering an adequate level of protection. They must then take one of the measures proposed to be in compliance with the Regulation. 

Group 29

European data protection board (EDPB)

Guidelines 2/2020 on articles 46 (2) (a) and 46 (3) (b) of Regulation 2016/679 for transfers of personal data between EEA and non-EEA public authorities and bodies (15 décembre 2020)

This document seeks to provide guidance as to the application of Articles 46 (2) (a) and 46 (3) (b) of the General Data Protection Regulation (GDPR) on transfers of personal data from EEA public authorities or bodies (hereafter “public bodies”) to public bodies in third countries or to international organisations, to the extent that these are not covered by an adequacy finding adopted by the European Commission . Public bodies may choose to use these mechanisms, which the GDPR considers more appropriate to their situation, but are also free to rely on other relevant tools providing for appropriate safeguards in accordance with Article 46 GDPR.

The guidelines are intended to give an indication as to the expectations of the European Data Protection Board (EDPB) on the safeguards required to be put in place by a legally binding and enforceable instrument between public bodies pursuant to Article 46 (2) (a) GDPR or, subject to authorisation from the competent supervisory authority (SA), by provisions to be inserted into administrative arrangements between public bodies pursuant to Article 46 (3) (b) GDPR. The EDPB strongly recommends parties to use the guidelines as a reference at an early stage when envisaging concluding or amending such instruments or arrangements.

The guidelines are to be read in conjunction with other previous work done by the EDPB (including endorsed documents by its predecessor, the Article 29 Working Party (“WP29”)) on the central questions of territorial scope and transfers of personal data to third countries . The guidelines will be reviewed and if necessary updated, based on the practical experience gained from the application of the GDPR.

The present guidelines cover international data transfers between public bodies occurring for various administrative cooperation purposes falling within the scope of the GDPR. As a consequence and in accordance with Article 2 (2) of the GDPR, they do not cover transfers in the area of public security, defence or state security. In addition, they do not deal with data processing and transfers by competent authorities for criminal law enforcement purposes, since this is governed by a separate specific instrument, the law enforcement Directive . Finally, the guidelines only focus on transfers between public bodies and do not cover transfers of personal data from a public body to a private entity or from a private entity to a public body.

Link

Recommendations 01/2020 on measures that supplement transfer tools to ensure compliance with the EU level of protection of personal data, version 2.0 (18 June 2021)

The EU General Data Protection Regulation (GDPR) was adopted to serve a dual-purpose: facilitating the free flow of personal data within the European Union, while preserving the fundamental rights and freedoms of individuals, in particular their right to the protection of personal data.

In its recent judgment C-311/18 (Schrems II) the Court of Justice of the European Union (CJEU) reminds us that the protection granted to personal data in the European Economic Area (EEA) must travel with the data wherever it goes. Transferring personal data to third countries cannot be a means to undermine or water down the protection it is afforded in the EEA. The Court also asserts this by clarifying that the level of protection in third countries does not need to be identical to that guaranteed within the EEA but essentially equivalent. The Court also upholds the validity of standard contractual clauses, as a transfer tool that may serve to ensure contractually an essentially equivalent level of protection for data transferred to third countries.

Standard contractual clauses and other transfer tools mentioned under Article 46 GDPR do not operate in a vacuum. The Court states that controllers or processors, acting as exporters, are responsible for verifying, on a case-by-case basis and, where appropriate, in collaboration with the importer in the third country, if the law or practice of the third country impinges on the effectiveness of the appropriate safeguards contained in the Article 46 GDPR transfer tools. In those cases, the Court still leaves open the possibility for exporters to implement supplementary measures that fill these gaps in the protection and bring it up to the level required by EU law. The Court does not specify which measures these could be. However, the Court underlines that exporters will need to identify them on a case-by-case basis. This is in line with the principle of accountability of Article 5.2 GDPR, which requires controllers to be responsible for, and be able to demonstrate compliance with the GDPR principles relating to processing of personal data.

To help exporters (be they controllers or processors, private entities or public bodies, processing personal data within the scope of application of the GDPR) with the complex task of assessing third countries and identifying appropriate supplementary measures where needed, the European Data Protection Board (EDPB) has adopted these recommendations. These recommendations provide exporters with a series of steps to follow, potential sources of information, and some examples of supplementary measures that could be put in place.

As a first step, the EDPB advises you, exporters, to know your transfers. Mapping all transfers of personal data to third countries can be a difficult exercise. Being aware of where the personal data goes is however necessary to ensure that it is afforded an essentially equivalent level of protection wherever it is processed. You must also verify that the data you transfer is adequate, relevant and limited to what is necessary in relation to the purposes for which it is processed.

A second step is to verify the transfer tool your transfer relies on, amongst those listed under Chapter V GDPR. If the European Commission has already declared the country, region or sector to which you are transferring the data as adequate, through one of its adequacy decisions under Article 45 GDPR or under the previous Directive 95/46 as long as the decision is still in force, you will not need to take any further steps, other than monitoring that the adequacy decision remains valid. In the absence of an adequacy decision, you need to rely on one of the transfer tools listed under Articles 46 GDPR. Only in some cases you may be able to rely on one of the derogations provided for in Article 49 GDPR if you meet the conditions. Derogations cannot become “the rule” in practice, but need to be restricted to specific situations.

A third step is to assess if there is anything in the law and/or practices in force of the third country that may impinge on the effectiveness of the appropriate safeguards of the transfer tools you are relying on, in the context of your specific transfer. Your assessment should be focused first and foremost on third country legislation that is relevant to your transfer and the Article 46 GDPR transfer tool you are relying on. Examining also the practices of the third country’s public authorities will allow you to verify if the safeguards contained in the transfer tool can ensure, in practice, the effective protection of the personal data transferred. Examining these practices will be especially relevant for your assessment where:

(i) legislation in the third country formally meeting EU standards is manifestly not applied/complied with in practice;

(ii) there are practices incompatible with the commitments of the transfer tool where relevant legislation in the third country is lacking;

(iii) your transferred data and/or importer fall or might fall within the scope of problematic legislation (i.e. impinging on the transfer tool’s contractual guarantee of an essentially equivalent level of protection and not meeting EU standards on fundamental rights, necessity and proportionality).

In the first two situations, you will have to suspend the transfer or implement adequate supplementary measures if you wish to proceed with it.

In the third situation, in light of uncertainties surrounding the potential application of problematic legislation to your transfer, you may decide to: suspend the transfer; implement supplementary measures to proceed with it; or alternatively, you may decide to proceed with the transfer without implementing supplementary measures if you consider and are able to demonstrate and document that you have no reason to believe that relevant and problematic legislation will be interpreted and/or applied in practice so as to cover your transferred data and importer. For evaluating the elements to be taken into account when assessing the law of a third country dealing with access to data by public authorities for the purpose of surveillance, please refer to the EDPB European Essential Guarantees recommendations. You should conduct this assessment with due diligence and document it thoroughly. Your competent supervisory and/or judicial authorities may request it and hold you accountable for any decision you take on that basis.

A fourth step is to identify and adopt supplementary measures that are necessary to bring the level of protection of the data transferred up to the EU standard of essential equivalence. This step is only necessary if your assessment reveals that the third country legislation and/or practices impinge on the effectiveness of the Article 46 GDPR transfer tool you are relying on or you intend to rely on in the context of your transfer. These recommendations contain (in Annex 2) a non-exhaustive list of examples of supplementary measures with some of the conditions they would require to be effective. As is the case for the appropriate safeguards contained in the Article 46 transfer tools, some supplementary measures may be effective in some countries, but not necessarily in others. You will be responsible for assessing their effectiveness in the context of the transfer, and in light of the third country law and practices and the transfer tool you are relying on, as you will be held accountable for any decision you take on that basis. This might also require you to combine several supplementary measures. You may ultimately find that no supplementary measure can ensure an essentially equivalent level of protection for your specific transfer. In those cases where no supplementary measure is suitable, you must avoid, suspend or terminate the transfer to avoid compromising the level of protection of the personal data. You should also conduct this assessment of supplementary measures with due diligence and document it.

A fifth step is to take any formal procedural steps the adoption of your supplementary measure may require, depending on the Article 46 GDPR transfer tool you are relying on. These recommendations specify some of these formalities. You may need to consult your competent supervisory authorities on some of them.

The sixth and final step is to re-evaluate at appropriate intervals the level of protection afforded to the personal data you transfer to third countries and to monitor if there have been or there will be any developments that may affect it. The principle of accountability requires continuous vigilance of the level of protection of personal data.

Supervisory authorities will continue exercising their mandate to monitor the application of the GDPR and enforce it. Supervisory authorities will pay due consideration to the actions exporters take to ensure that the data they transfer is afforded an essentially equivalent level of protection. As the Court recalls, supervisory authorities will suspend or prohibit data transfers in those cases where they find that an essentially equivalent level of protection cannot be ensured, following an investigation or a complaint. Supervisory authorities will continue developing guidance for exporters and coordinating their actions in the EDPB to ensure consistency in the application of EU data protection law.

Lien

The European Commission

Decision (EU) 2021/914 on standard contractual clauses for the transfer of personal data to third countries pursuant to Regulation (EU) 2016/679 of the European Parliament and of the Council, (4 June 2021)

Link

CJEU caselaw

C-311/18 (16 July 2020)

1.   Article 2(1) and (2) of Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation), must be interpreted as meaning that that regulation applies to the transfer of personal data for commercial purposes by an economic operator established in a Member State to another economic operator established in a third country, irrespective of whether, at the time of that transfer or thereafter, that data is liable to be processed by the authorities of the third country in question for the purposes of public security, defence and State security.

2.   Article 46(1) and Article 46(2)(c) of Regulation 2016/679 must be interpreted as meaning that the appropriate safeguards, enforceable rights and effective legal remedies required by those provisions must ensure that data subjects whose personal data are transferred to a third country pursuant to standard data protection clauses are afforded a level of protection essentially equivalent to that guaranteed within the European Union by that regulation, read in the light of the Charter of Fundamental Rights of the European Union. To that end, the assessment of the level of protection afforded in the context of such a transfer must, in particular, take into consideration both the contractual clauses agreed between the controller or processor established in the European Union and the recipient of the transfer established in the third country concerned and, as regards any access by the public authorities of that third country to the personal data transferred, the relevant aspects of the legal system of that third country, in particular those set out, in a non-exhaustive manner, in Article 45(2) of that regulation.

3.   Article 58(2)(f) and (j) of Regulation 2016/679 must be interpreted as meaning that, unless there is a valid European Commission adequacy decision, the competent supervisory authority is required to suspend or prohibit a transfer of data to a third country pursuant to standard data protection clauses adopted by the Commission, if, in the view of that supervisory authority and in the light of all the circumstances of that transfer, those clauses are not or cannot be complied with in that third country and the protection of the data transferred that is required by EU law, in particular by Articles 45 and 46 of that regulation and by the Charter of Fundamental Rights, cannot be ensured by other means, where the controller or a processor has not itself suspended or put an end to the transfer.

4.   Examination of Commission Decision 2010/87/EU of 5 February 2010 on standard contractual clauses for the transfer of personal data to processors established in third countries under Directive 95/46/EU of the European Parliament and of the Council, as amended by Commission Implementing Decision (EU) 2016/2297 of 16 December 2016 in the light of Articles 7, 8 and 47 of the Charter of Fundamental Rights has disclosed nothing to affect the validity of that decision.

5.   Commission Implementing Decision (EU) 2016/1250 of 12 July 2016 pursuant to Directive 95/46/EC of the European Parliament and of the Council on the adequacy of the protection provided by the EU-US Privacy Shield is invalid.

Opinion of Advocate general

Judgment of the Court