EU court rules transatlantic data deal invalid

The European Court of Justice on Tuesday deemed transatlantic data-sharing deal which would allow American tech companies to transfer users' data from the European Union (EU) to the US, as invalid

"The Court of Justice declares that the (European) Commission's US Safe Harbour Decision is invalid," it said.

The EU data protection laws forbid its citizens' information from being exported to countries outside the region without adequate levels of protection, Xinhua news agency reported.

But under the so-called "Safe Harbour" agreement, businesses to transfer personal data of European citizens to the US are allowed as long as they meet seven EU principles.

Since its introduction in 2000, the agreement has come to be relied on by 4,400 businesses, including internet giants such as Facebook, Google and Amazon.

However, Maximillian Schrems, an Austrian law student, argued that since Facebook data was subjected to mass surveillance by US intelligence agencies, it did not offer an adequate level of protection.

As a Facebook user since 2008, Schrems lodged a complaint with the Irish supervisory authority, in the light of the revelations made in 2013 by American whistleblower Edward Snowden concerning the activities of the US intelligence services, in particular the National Security Agency (NSA), the law and practice does not offer sufficient protection against surveillance by the public authorities of the data transferred to that country.

The Irish authority rejected the complaint. The case was brought to the High Court of Ireland and later transferred to the European court.

After investigation, European Court of Justice concluded the agreement invalid, saying "the transfer of the data of Facebook's European subscribers to the US should be suspended."

As thousands of US businesses rely on the agreement as a means of moving information to Washington from Europe, analysts said the companies would have to restructure their business to avoid breaking the law.

They have to put replacement measures in place and these will take a lot of time and money, analysts added.