Thibault Soyer

CNIL’s recent ruling against Orange has wider lessons for all data controllers who rely on processors and sub processors to process personal data. Datonomy’s correspondent in Paris analyses the issues.

Facts

In its deliberation dated 7 August 2014 (but only published on 25 August), the CNIL issued, for the first time, a public warning (i.e no fine has been imposed on Orange, but the sanction consists in the publication of CNIL’s ruling on its website) against a telecoms operator on the basis of personal data breach requirements (pursuant to Article 34 bis of the French data protection act 1978). On 25 April 2014, Orange notified the CNIL of a technical failure in one of its marketing sub-processors, resulting in the leak of personal data (name, surname, birth date, email address and phone number) concerning 1.3 million subscribers. Following this notification, the CNIL investigated Orange and its processors’ premises and found that Orange had not fulfilled its obligation to ensure the security and confidentiality of personal data with such sub-processor, despite the fact that the security breach had been adequately notified and dealt with by Orange.

Sanction grounds

The focal point of particular interest in this decision is that, although Orange was found to be compliant with personal data breach requirements, notably by having notified the CNIL and data subjects “forthwith” of the breach, this notification brought the attention of the French privacy watchdog to the security and confidentiality measures imposed by Orange on its subcontracting chain. The key issues highlighted by CNIL were as follows:

  • although its first (main) processor had complied with security and confidentiality measures imposed on it contractually, Orange had not ensured a back-to-back of the security and confidentiality provisions in the agreement between the processor and its sub-processors;
  • Orange had not conducted any security audit on the version of the marketing application specifically developed by its sub-processor, which would have allowed it to identify the security breach; and
  • Orange did not sufficiently protect customers’ personal data when updating and sending them to its processors (by non-encrypted emails).

Lessons to be learned and security standards to be set to anticipate data breaches

This case stresses the utmost importance for electronic communications operators to be proactive and plan appropriately, notably by complying with the high preventive standards that regulators expect data controllers to adopt in order to demonstrate that they have implemented “appropriate” security measures under the current data breach rules, as indicated in the recent March 2014 Data Breach Opinion issued by the EU’s Article 29 Working Party. On top of that, this ruling shows how important it is for electronic communications operators to impose security obligations at least as stringent as those applicable to them on their processors and sub processors. For further information on this WP 29 Opinion, please see the report by my fellow Datonomist Claire issued in April this year, and the coverage of the underlying Regulation by Carsten in July 2013.

 

Posted in Article 29 Working Party, breach notification, Controller to processor clauses, data breach, data breach notification, data breach notification; telecoms package; Directive 95/46/EC, data breach notification; telecoms package; europe, data breaches, data loss, data processor, data protection compliance, data security standards, encryption, information security, Telecoms Package | Leave a comment
Andreas Splittgerber

Our quarterly IT and data protection newsletter keeps you informed of current legal issues, decisions and events in the technology sector in Germany. We hope you enjoy reading.

This edition covers the following topics.

I.          Canvas Fingerprinting – Tracking without Cookies

II.          District Court of Berlin: WhatsApp must provide terms and conditions in German, and improve the legal notice

III.          „No-Spy decree“ of the German Federal Ministry of Interior requires guarantee in procurement procedures

IV.          German Supreme Court: Collection of minors’ personal data for marketing purposes in the course of a competition is not permitted

V.          ECJ: Copies on the user’s computer screen as well as in the ‘cache’ of a computer’s hard disk, created in the course of viewing a website, do not infringe copyright

This is the link to the full version.

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Mel Shefford

With the awareness that future cyber-attacks could have very serious consequences, the Government has proposed amendments to the Computer Misuse Act 1990. In this post we look at the current offences under the Act as well as recent amendments proposed by the Serious Crime Bill.

In August 2013, the outgoing US Secretary of Homeland Security Janet Napolitano gave a farewell speech in which she warned: “Our country will, at some point, face a major cyber event that will have a serious effect on our lives, our economy and the everyday functioning of our society.”

Her message vocalised what governments, businesses and organisations around the world are well aware of: as we become increasingly reliant on technology, and as systems become even more interconnected and complex, the risk of a serious cyber-attack increases. And whilst we currently associate cyber-attacks with access to personal data and damage to commercial interests, in the future the impact could be even more serious. For example, future attacks could result in major damage to the economy, national security, the environment and/or human welfare.

With this in mind, the British Government has been ramping up efforts over the past few years to tackle cyber-crime. For example, in 2011 it launched the National Cyber Security Strategy; in 2013 the National Cyber Crime Unit started operations; and £860 million has been committed until 2016 to boost the UK’s cyber capabilities. More recently, BIS announced the Cyber Essentials scheme to help businesses protect themselves against cyber-attacks.

Most Datonomy readers will be well aware of how important it is for organisations to be proactive about preventing data breaches, and how devastating the consequences can be if a breach does occur. But what are the consequences for hackers who are caught?

Offences under the Computer Misuse Act 1990

In the UK, the hacker might be guilty of  one or more of the following offences under the Computer Misuse Act 1990:

  • Obtaining unauthorised access to computer material (for example, using another person’s ID and password to log onto a computer and access data). The maximum penalty is a 2 year prison sentence and/or an uncapped fine (Section 1).
  • Obtaining such access in order to commit or facilitate the commission of another offence, such as theft of funds or data. The maximum penalty here is a 5 year prison sentence and/or an uncapped fine (Section 2).
  • Obtaining such access in order to intentionally or recklessly impair the operation of any computer, a program or the reliability of data held on a computer; prevent or hinder access to any program or such data; or enable such impairment, prevention or hindrance. This offence carries a maximum penalty of 10 years in prison and/or an uncapped fine (Section 3).
  • Making, supplying or obtaining articles for use in any of the above offences. This carries a maximum 2 year prison sentence and/or an uncapped fine (Section 3A).

The Serious Crime Bill

In June, the Queen announced the Serious Crime Bill which (among other aims) seeks to amend the Computer Misuse Act so that serious cyber-attacks are properly punished. In particular, there is a concern that the current custodial penalties – which have been described as “woefully inadequate” by a member of the House of Lords – are not sufficient for serious cyber-attacks. The two main changes proposed by the Bill are as follows:

(1)   The creation of a new offence to cover serious cyber-attacks

This new offence would be committed where a person knowingly, and intentionally or recklessly, commits any unauthorised act in relation to a computer which causes or creates a significant risk of serious damage to human welfare, the economy, the environment or national security in any country.

An act causing damage to “human welfare” would be something causing loss to human life; human illness or injury; disruption of a supply of money, food, water, energy or fuel; disruption of a system of communication; disruption of facilities for transport; or disruption of facilities relating to health.

Commission of this offence would be punishable by up to 14 years’ imprisonment and/or a fine, except where the act causes loss to human life, human illness or injury, or serious damage to national security, in which case the penalty is life imprisonment and/or a fine.

The Home Office has acknowledged that no cyber-attack has occurred to date which would engage this new offence. However, the idea is to ensure that there are substantive penalties if a serious attack were to occur in the future. Indeed, the Home Office anticipates – and no doubt hopes – that the number of prosecutions for this offence will be minimal.

(2)   Implementation of the EU Directive on Attacks Against Information Systems (2013/40/EU)

This Directive is designed to ensure that the EU has minimum rules on cyber offences and sanctions, and to ensure co-operation between EU member states in relation to cyber-attacks. The UK is already compliant with the Directive, except for the following two aspects:

  • Tools for the commission of an offence

The existing Section 3A offence of making, supplying or obtaining articles for use in another offence under the Act requires the prosecution to prove that the defendant obtained the tool with a view to it being supplied for use to commit or assist in the commission of the other offence. The Bill seeks to amend this offence so that it covers circumstances where an individual obtained a tool with the intention to use it themselves to commit or assist in the commission of a separate offence. Given the increasing ease with which individuals can now obtain malware, the Home Office hopes that this amendment will be instrumental in helping to avoid cyber-attacks in the first place.

  •  Extension of the extra-territorial jurisdiction of the Act

The Directive requires EU member states to establish their jurisdiction over cyber offences which are committed by their nationals. The Act currently requires the prosecution to demonstrate a “significant link” to the UK for the section 1 and 3 offences, essentially being that the defendant or computer was in the UK at the time of the offence. To conform to the Directive, the Bill extends the list of possible significant links to the UK to include the defendant’s nationality. This would mean that a UK national could be prosecuted for an offence where the only link to the UK is her/her nationality, provided that the offence is also an offence in the jurisdiction where it took place.

The legislative timetable and process

The Bill started in the House of Lords, and at the time of writing, the House of Lords report stage – where the Bill will be examined in more detail and the Lords will vote on proposed amendments – is scheduled to commence on 14 October. After a third reading at the House of Lords, it will then be considered by the House of Commons. The EU implementation aspects will need to be in force on or before 4 September 2015 in order to meet the EU transposition deadline, but the rest of the Bill will no doubt be subject to more scrutiny.

Posted in cyber-privacy, data breach, data breaches, data disclosure, data loss, data theft, data violation, Datonomy, EU, EU Legislation, fines, Home Office, identity fraud. personal data defintion., Penalty, police, UK | Tagged , , , , , | Leave a comment
Andreas Splittgerber

The European Union Agency for Fundamental Rights has published a Handbook of European data protection law, to which I was a contributor.

This handbook is designed to familiarise legal practitioners who are not specialised in the field of data protection with this area of law. It provides an overview of the European Union’s and the Council of Europe’s applicable legal frameworks.

The Handbook can be found here.

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Jai Nathwani

The first edition of Olswang’s Cyber Alert, a regular round up of regulation, best practice and news from our international cyber breach and crisis management team has been published.

Please click here for a printable PDF version.  In this first edition we cover:

In the last few months we have seen news headlines ranging from the international operation against the GameOver Zeus botnet, to  state-sponsored hacking, arrests over the BlackShades malware, and the release of the latest Information Security Breaches Survey, not to mention continued concern over the Heartbleed vulnerability, so there is much for businesses to consider. Click here for a summary of some of the latest headlines.

It is also worth mentioning the European Court of Justice’s Google Spainruling in May, which is arguably the most profound internet case of this decade and which continues to send shockwaves through the tech sector. Whilst Google Spain does not relate to cybersecurity specifically, it does establish that in some circumstances a non-European company is answerable to the European courts and accountable under European data protection laws, including the requirement for appropriate technical and organisational measures to be in place to protect personal data. Read Olswang’s analysis of Google Spain here.

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Claire Walker

Last week’s  seismic  decision in the Google Spain case continues to generate many column inches of comment and will no doubt continue to do so for some time. Datonomy’s colleagues in  Olswang’s international privacy team have just published a paper  considering the practical implications of this decision in the round.  You can access it at this link. The paper considers:

  •  Google’s practical options in terms of next steps
  • the implications for individuals’ rights
  • the implications for online publishers
  • what it means for the Right To Be Forgotten under the new EU Regulation
  • the impact on  wider “data debates” over other technologies such as email scanning and Google Glass
  • what it tells us about the workings of Europe’s highest commercial court, and tactical tips for bringing referrals on points of EU law.

The paper is also available in PDF here.

Posted in Directive 95/46/EC, ECJ ruling, EU data protection reform, EU Legislation, eu proposals, Google, journalism, online data protection, Reform of EU DP law, reform proposals, search engine, Spain | Leave a comment
Marcos García-Gasco

The Court of Justice of the European Union (“CJEU”) made a historic ruling  in the case of Google v Spain [Case C‑131/12]. The CJEU ruled that Googleis responsible for the processing that it carries out of personal data which appear on web pages published by third parties.

The decision is something of a surprise given that it goes against the Advocate General’s Opinion delivered last year, and indeed is quite a bold statement by the CJEU on what it sees as the future of data protection in the internet age and the legal responsibilities of search engines.

Background

The case arose after a complaint that was brought against Google by a Spanish individual, Mario Costeja González, to the Spanish Data Protection Authority (AEPD). Mr González had been the subject of an auction notice for unpaid debts that was published in a widely-read newspaper in Spain around a decade ago.  Despite the time that had elapsed since this initial publication, this was still featured prominently in a Google search for Mr González’s name.  Mr González argued that this was in breach of the EU Data Protection Directive (the “DPD”) as the data was not current and that in such circumstances, there should essentially be a “right to be forgotten.” 

The AEPD agreed, and Google subsequently appealed to the Spanish National High Court which in turn referred questions on the meaning of the DPD to the CJEU.

The decision

Despite the Opinion of Advocate General Jääskinen, who considered last year that search engine service providers should not be considered responsible for third-party content on the basis of the DPD for personal data appearing on web pages they process, the Grand Chamber of the ECJ in the judgement published today has concluded as follows:

  • The activities carried out by Google, namely ‘finding information published, indexing it automatically, storing it temporarily and making it available to the public’, must be classified as ‘processing of personal data’ for DPD purposes.  Furthermore, the operator of the search engine must be regarded as the ‘data controller’ regardless of the fact that they have no control over the underlying data itself. 

 

  • Google falls within the territorial scope of the DPD as its Spanish subsidiary is intended to promote and sell advertising space directed at the citizens of that Member State, which is sufficient to be considered ‘established’ in that Member State.

 

  • Google must remove links to third-party websites displayed from a search of an individual, where those websites contain personal data relating to the individuals  concerned.  This is subject to certain exceptions, such as public figures, and to achieving a proper balance between the data subject’s fundamental rights and the right to information.

Conclusion

This decision has far-reaching consequences for Google in Europe.  The bar to when there would be a public interest in search engines processing data relating to individuals in the form of search returns seems very high and where the data relates to an individual who is not a public figure, it is rather doubtful that this could ever be permitted. 

There is no clear view how Google will respond to the judgment, but there must be a significant possibility that it will have to establish an elaborate administrative system to deal with individuals who complain about it using their data and sophisticated technical means to ensure that this is blocked. 

It is also unclear how the ruling will affect the ongoing negotiations of the General Data Protection Regulation.  Early drafts of the Regulation included a broad “right to be forgotten” though the latest draft has watered this down somewhat.  Commissioner Viviane Reding who is championing the draft Regulation welcomed today’s ruling saying it was a “strong tailwind” to the proposed data protection reforms in Europe.  The reality is that the Regulation still faces a rocky road before it is passed and some commentators are already questioning why we need new rules for a right to be forgotten at all given today’s ruling.

What is clearer is that the ruling is a sign of the CJEU’s reluctance to allow non-EU-based multinationals to evade European laws where they are clearly otherwise established here.

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Jai Nathwani

The ISO is developing specific new security standards for cloud services, which are expected to be published in 2015. This is another welcome step towards ensuring compliance with the principles in the Data Protection Act and further boosting customer confidence in in cloud computing technologies.

Why the new standard?

The development of the new standard is a direct response to one of the key goals announced in the 2012 European Cloud Computing Strategy (the “Strategy”). The Strategy was published by the European Commission with the aim of promoting the rapid adoption of cloud computing in all sectors of the economy in order to boost productivity. The Commission’s own Cloud Standards Roadmap talks about concerns over security as often being cited as a barrier to migrating data to the cloud. Under current rules, liability for breach of data protection rules rests with the data controller therefore, an auditable standard for cloud service providers who process personal data is crucial to demonstrate the supplier’s resilience and hence enable a customer to meet its own regulatory obligations on data security. The need for a recognised benchmark was further endorsed by the Information Commissioners’ guidance on Cloud Computing, published in 2012. The guidance states that when selecting a cloud service provider, the data controller must choose a processor providing sufficient guarantees about the technical and organisation security measures governing the processing to be carried out, and must take reasonable steps to ensure compliance with those measures. Audited compliance to a standard would be the appropriate method to ensure that data controllers comply with its data protection obligations and could be written into the contract between a cloud services supplier and a customer.

The new ISO 27017 and 27018

In response to the need for a cloud computing security standard the International Organisation for Standardisation (“ISO”), which is already responsible for benchmark standards for due diligence on data processors, is developing two cloud specific standards, ISO 27017 and ISO 27018. The two standards are due for official release in 2015.

The new standards are based on the familiar standards of ISO 27001 and 27002. ISO 27001 provides a framework of security controls that can be adapted and applied to an organisation of any size to create a security standards framework. ISO 27002 provides for the practical implementation of the ISO 27001 framework in an organisation. The 27001 and 27002 standards apply generally to the operation of ICT systems. The two new standards under development apply 27002 specifically to cloud computing.

ISO 27017 deals with the application of the ISO 27002 specification to the use of cloud services and to the provision of cloud services. It will recommend cloud-specific information security controls to supplement those recommended by ISO 27002.

ISO 27018 deals with the application of 27002 to the handling of Personally Identifiable Information (“PII”) and will serve as a code of practice for PII protection in public clouds which act as PII processor.

For more detail see this link to the ISO’s website.

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Claire Walker

With the Heartbleed web vulnerability in the tech headlines, the practical guidance issued recently by EU regulators on when to alert individuals to data breaches (and on preventive steps to reduce the risk of breaches occurring in the first place) is particularly timely. Datonomy highlights some of the key recommendations on when to make the difficult judgement call over notification.

Why the new guidance? Does it apply to your organisation?

The recent Opinion issued by the EU’s Article 29 Working Party (the body made up of national data protection regulators) concerns the ever-topical issue of personal data breach notification. Specifically, it sets out the regulators’ collective view on when data controllers should alert data subjects to a personal data breach which is likely to adversely affect those individuals’ personal data or privacy.

The guidance sets out good practice for “all controllers”. Strictly speaking the obligation to report data breaches only applies to communications services providers under current rules; however in practice, handling a data breach is a business-critical issue for all organisations. The illustrations and in the guidance are drawn from a wide range of contexts.  As well as analysing the triggers for notifying individuals that their data has been compromised, the guidance sets out practical steps to reduce the risk of breaches occurring and/ or to mitigate their severity. It is therefore a must-read for all in house counsel and their colleagues in the IT function – both in devising a data reach response plan, and in designing systems to reduce the risk of vulnerabilities in the first place.

A quick recap on breach notification obligations – current and future

As reported by Carsten on Datonomy last year, communications service providers (CSPs) are already subject to reporting obligations under EU Regulation 611/2013. CSPs’ obligations are two fold:

  • to report all data breaches to the regulator (within 24 hours); and
  • to notify the data subject “without undue delay” when the breach is “likely to adversely affect the personal data or privacy” of that individual.

Notification to the affected individual is not required if the CSP has implemented “appropriate technological protection measures” to render the data unintelligible to any person who is not authorized to access it. The Regulation defines what constitutes “unintelligible”, by reference to encryption and hashing. It does not set out specific standards but it authorises the Commission to publish a separate indicative list of technological protection measures that are sufficient for that purpose

As Datonomy readers will be aware, these notification obligations are likely to be formally extended to all data controllers, regardless of sector, under the draft EU Data Protection Regulation.

However, notification of data breaches, both to the regulator and to affected individuals, is already an important practical consideration for all organisations from a damage limitation point of view. While not risk –free, voluntary notification to the regulator and to individuals may help to mitigate the sanctions imposed by a regulator where a data controller has suffered a data breach as a result of falling short of data security obligations under the UK Data Protection Act.

Wide ranging illustrations of when a breach “likely to adversely affect” a person’s privacy

The guidance sets out seven different and wide-ranging breach scenarios. These include: loss of laptops containing medical data and financial data; web vulnerabilities exposing life insurance and medical details; unauthorised access to an ISP’s customers’ details including payment details; disclosure of hard copy credit card slips; unauthorised access to subscribers’ account data both through unauthorised disclosure and through coding errors on a website. Whilst not exhaustive, these worked examples do provide useful analysis of the different types of harm which could trigger the obligation to notify individuals.

The guidance breaks the analysis down onto three different categories of data breach, and gives illustrations of the adverse privacy effects of each type. These are:

Confidentiality breach: unauthorised disclosure of or access to personal data which can lead to ID theft, phishing attacks, misuse of credit card details, compromise of other accounts or services which use the same log in details  and a wide range of other detrimental effects on the individual’s family and private life and work prospects. Most of the examples focus on confidentiality breach.

Availability breach: accidental/ unlawful destruction or loss – which can lead to disruption and delay and even financial loss. (The illustrations of financial loss, and the consideration of “secondary effects” in a data availability context will also be of interest to those negotiating liability provisions in commercial deals which involve the handling or personal data.)

Integrity breach: the alteration of personal data – which can lead to serious consequences for medical and customer data.

The distinction is significant, particularly as the need to notify individuals about confidentiality breach can be mitigated or eliminated by the use of appropriate encryption – see below.

The guidance also stresses the need to consider likely “secondary effects” of a breach which may not appear in itself to adversely affect privacy. The example given here is of the hacking of a music service website. While the direct effect may be limited (leak of names, contact details and users’ musical preferences) it is the secondary effect – the fact that passwords have been compromised, and that users may use the same passwords across other accounts – which creates the need to notify individuals of the breach.

Prevention better than cure: practical steps to avoid the need to report breaches to individuals

In relation to each scenario, the guidance sets out examples of appropriate safeguards to reduce the risk of such breaches occurring in the first place and/ or mitigating the privacy impact. As noted above, notification to individuals is not required if a data controller can satisfy the regulator that the data has been rendered unintelligible. Common themes which run through these practical recommendations include:

  • Encryption: First and foremost, the guidance emphasises the need for appropriate, state of the art encryption with a sufficiently strong and secret key
  • Secure storage of passwords: salted and using a state of the art cryptographic hash function – simply hashing passwords is unlikely to meet the “unintelligible” data exemption for notification.
  • Password policies: requiring stronger password choices for users, and requiring password resets whenever passwords are compromised.
  • Vulnerability scanning: to reduce the risk of hacks and other breaches
  • Regular back ups: to mitigate against the effects of availability breach
  • Systems and process design: to reduce the risk of breach and /or mitigate its effects –the examples given include dissociation of medical information from individuals’names.
  • Access controls: Limiting global access, and restricting access to databases on a “need to know” and “least privilege” basis – including minimising access given to vendors for system maintenance.
  • Staff training e.g. on how to delete data securely data.
  • Incident management policies: the guidance also highlights the importance of good incident management policies in limiting the duration and effects of data breaches.

Be proactive and plan!

The new Opinion provides organisations with helpful guidance on making the difficult judgement call over when to notify customers and other individuals about breaches of their personal information. Perhaps even more importantly, it sets out some of the minimum preventive standards that regulators expect data controllers to adopt in order to demonstrate that they have implemented “appropriate” security measures under the current rules. The Opinion urges data controllers to “be proactive and plan appropriately”. The guidance will help organisations decide when they need to alert individuals – but it is having a crisis management team and a (rehearsed) action plan in place that will enable a calm and swift response, should a data breach arise.

Posted in Article 29 Working Party, audit, breach notification, civil monetary penalties, data breach, data breach notification, data breach notification; telecoms package; Directive 95/46/EC, data breaches, data loss, Data Protection Act 1998, data protection compliance, Data Protection errors, Data Protection Guidance, data protection regulation, data theft, encryption, EU data protection reform, ICO fines, laptop, trigger | Leave a comment
Matthias Vierstraete

On 8 April 2014 the European Court of Justice ruled that the Data Retention Directive 2006/24/EC interferes in a particularly serious manner with the fundamental rights to respect for private life and to the protection of personal data. The Directive is declared invalid.

A.    The Directive

Directive 2006/24/EC strives for harmonization of the Member States’ national legislations providing for the retention of data by providers of publicly available electronic communications services or of a public communications network for the prevention, investigation, detection and prosecution of criminal offences. The initial intention was that service and network providers would be freed from legal and technical differences between national provisions.

The Directive and national laws implementing the Directive were often criticized. The main argument being that massive data retention was said to endanger the right to privacy. The advocates of the rules, however, argued that these rules were necessary for authorities to investigate and prosecute organized crime and terrorism.

B.    The Court of Justice

By way of preliminary rulings referred to the Court of Justice of the European Union, the Irish High Court and the Austrian Constitutional Court asked the Court of Justice to examine the validity of the Directive, in particular in the light of two fundamental rights under the Charter of Fundamental Rights of the EU, namely the fundamental right to respect for private life and the fundamental right to the protection of personal data.

  • Analysis of the data to be retained

The Court of Justice verified the data which providers must retain pursuant to the Directive. This data includes data necessary to trace and identify the source of a communication and its destination, to identify the date, time, duration and type of a communication, to identify the location of mobile equipment, the name and address of the user, the number called, IP addresses, etc. The Court observes that the retention of this data makes it possible to know the identity of the participants in communications, to identify the time of the communication, the place from where the communication took place and the frequency of communications with certain persons (§26).

This data, according to the Court allows very precise conclusions concerning private lives of persons whose data has been retained, such as habits of everyday life, places of residence, movements, social relationships and social environments frequented.

  • Analysis of the interference with fundamental rights

The Court comes to the conclusion that both requiring the retention of the data and allowing competent national authorities to access those data constitutes in itself interference with the fundamental right to respect for private life and with the fundamental right to the protection of personal data (respectively articles 7 and 8 of the Charter of Fundamental Rights of the European Union) (§ 32 – 36).

The Court agrees with the Advocate General when it states that the interference is “particularly serious. The Court in this respect holds that “the fact that data are retained and subsequently used without the subscriber or registered user being informed is likely to generate in the minds of the person concerned the feeling that their private lives are the subject of constant surveillance” (§37).

This interference is according to the Court not only serious, but moreover it is not justified. Besides the fact that the retention of data as required by the Directive does not as such adversely affect the essence of the respect for private life and protection of personal data (content of the communications as such may not be reviewed) and the Directive genuinely satisfies an objective of general interest (public security), the Court is of the opinion that the Directive has exceeded the limits imposed by the proportionality principle (§69):

  • The Directive covers all persons and all means of electronic communications as well as all traffic data without any differentiation, limitation or exception being made in the light of the objective of fighting against serious crime (§57);
  • The Directive fails to lay down any objective criterion by which to determine the limits of the access of the competent national authorities to data and their subsequent use (§60);
  • The data retention period is set at between a minimum of 6 months and a maximum of 24 months without any distinction being made between categories of data and not stating that the determination of the period must be based on objective criteria (§63 – 64);
  • The Directive does not provide for sufficient safeguards to ensure effective protection of data against the risk of abuse and against unlawful access and use (§66);
  • The Directive does not require data to be retained within the EU and thus does not meet the Charter’s requirement that compliance control by an independent authority is ensured.

The Court of Justice thus declares the Directive invalid.

C.    What’s next?

Following the Court’s invalidation of the Directive, one could wonder how this will affect European legislation and national legislation.

  • Europe

The invalidity ruled by the Court applies from the day where the Directive entered into force. It is as if the Directive never existed.

The European Commission stated in a first reaction that it “will now carefully asses the verdict and its impacts”. It is not clear whether the Commission will draft new legislation replacing the invalidated Directive. Taking into account the fact that the current Commission’s term only runs until 31 October 2014, it is not much anticipated that new law will be put forward soon.

  • Member States

Member States having transposed the Directive into national laws may now consider the future of these laws.

In case their national law is a literal transposition of the now invalidated Directive, the national laws meet with the same fate. One may consider that in such situation Member States should redraft their laws in order to be in line with the relevant Directives (95/46/EC and 2002/58/EC) and the Charter of Fundamental Rights of the European Union.

If national law deviates from the Directive, Member States should assess whether the deviations are in line with the relevant Directives (95/46/EC and 2002/58/EC) and the Charter of Fundamental Rights of the European Union.

The Court of Justice’s ruling may also have an impact on national cases concerning the legality of national laws implementing the Directive, as there are several cases pending before the constitutional courts.

  • Austria and Ireland are obviously at the basis of the European Court of Justice’s ruling, following their constitutional courts’ requests for a preliminary ruling concerning the validity of Directive 2006/24/EC;
  • Belgium: On 24 February 2014, the Belgian “Liga voor Mensenrechten” and “Ligue des droits de l’Homme” together filed a complaint before the constitutional court in order to obtain cancellation of the Belgian law implementing the Directive. The complaint was funded through crowdfunding. Following the Court of Justice’s ruling, some political parties already asked government to take the necessary steps and to amend the current legislation;
  • Bulgaria: In 2008, the Bulgarian Constitutional Court found part of the national law incompatible with the right to privacy;
  • France: In 2006, the French Constitutional Court ruled that French law provisions similar to those provided for in the Directive are not contrary to the constitution. However, in December 2013, the French data protection authority (CNIL) reacted vigorously against a new law enabling certain ministries, including French secret services, access to data retained by telecommunications operators, internet and hosting service providers, without prior approval from a judge. On that occasion, the CNIL called for a national debate on surveillance issues which could be influenced by the recent ECJ’s ruling.
  • Germany: The German Constitutional Court already declared the German implementing act unconstitutional in 2010;
  • Romania: In 2009, the Romanian Constitutional Court declared the national law on data retention unconstitutional as breaching, among others the right to privacy and the secrecy of correspondence;
  • Slovakia: In 2012, a complaint was filed before the constitutional court in order to assess the conformity with the constitution;
  • Spain: The Directive was implemented into national laws in 2007. The Spanish data protection authority (AEPD) had voiced its reservations about the Directive and requested the Government to accompany the implementation of these rules with measures curtailing the impact on data subjects’ privacy;
  • Sweden: In May 2013, Sweden was ordered to pay the European Commission 3 million EUR because Sweden had failed its obligation to timely implement the Directive;
  • United Kingdom: As yet there has been no official comment from the UK government or the Information Commissioner on the ruling of the Court of Justice. Controversial 2012 proposals for a Communications Data Bill to overhaul and significantly extend the UK’s data retention obligations were already in the political long grass – and the Court of Justice’s ruling means they are likely to stay there as we understand it.

Obviously the current situation creates uncertainties and we understand the issue will be very much discussed in Brussels (and elsewhere) in the coming weeks.

Sylvie Rousseau and Matthias Vierstraete, Olswang Brussels

Posted in Communications Data Retention Directive, comparison of laws, cyber-privacy, data collection, data protection. privacy.freedom of information, Data Retention, data retention; dna; ECHR; human rights, Directive 2002/58, Directive 95/46/EC, e-Privacy, ECJ, ECJ ruling, EU, EU Legislation, failure to comply with EU Directive, surveillance society. | Leave a comment