Tag Archives: adequacy decisions

Section 2. A look at the surface: it is not an adequacy decision, but it establishes adequacy

(Section 2 of the Analysis of the AG Opinion in the “PNR Canada” Case: unlocking an “unprecedented and delicate” matter)

One of the fundamental issues concerning agreements such as the one in the present case is how do these agreements relate to the concept of “adequacy finding” for the purposes of transfers of personal data from the EU to third countries.

While it is straightforward looking at their nature that they are not unilateral acts issued by the European Commission to establish that a third country or the authorities of a third country have an adequate level of protection (as was the Decision invalidated by the Schrems judgement), in essence these agreements have the same effect as that of adequacy decisions: they establish a presumption that the legal system at the receiving end of a data transfer from the EU ensures an adequate level of data protection, eliminating thus impediments of transfers based on concerns that the data are not properly protected at the receiving end.

While the process leading to an adequacy decision by the Commission is long and involves a thorough analysis of the legal system of the third country in order to ascertain that it provides an essentially equivalent level of protection in theory and in practice, the conclusion of an international agreement involves a high level negotiation and commitments taken by the third country that it would ensure appropriate protection. It is more difficult to ascertain and control a posteriori if this indeed happens in practice. Moreover, if the commitments taken by the third country are not sufficient in the Agreement, a clause establishing that the transfers to that country are deemed to comply with EU data protection law may very well be considered as breaching Article 8(1) of the Charter. The CJEU stated in Schrems that the requirements for ensuring lawful international transfers of personal data stem from Article 8(1) of the Charter and the general obligation enshrined therein “to protect personal data” (§71-§72 of Schrems).

These issues are extremely challenging and the current proceedings would be a very good opportunity to address them. However, the AG only marginally touches this question and he does that only to argue against the fact that data protection is the predominant purpose of the Agreement and to argue in favour of a strict review of the limitations brought by the provisions of the Agreement to the exercise of Article 8 of the Charter.

First, in §93, he states that “the object of the agreement envisaged cannot principally be treated as equivalent to an adequacy decision, comparable to the decision which the Commission had adopted under the 2006 Agreement”. He continues by arguing that “both the aim and the content of the agreement envisaged show, on the contrary, that that agreement is intended to reconcile the two objectives which it pursues and that those objectives are inseparably linked” (i.e. – data protection and fight against terrorism) (§93).

However, about a hundred of paragraphs later, after he recalls the finding in §93 that “the agreement envisaged cannot be reduced to a decision finding that the Canadian competent authority guarantees an adequate level of protection” (§203), he recognizes that “Article 5 of the agreement envisaged does indeed provide that, subject to compliance with the terms of that agreement, the Canadian Competent Authority is to be deemed to provide an adequate level of protection, within the meaning of relevant Union data protection law, for the processing and use of PNR data” (§203).

Moreover, in the same paragraph, the AG even adds that “the contracting parties’ intention is indeed to ensure that the high level of personal data protection achieved in the Union may be guaranteed when the PNR data is transferred to Canada” (§203).

The arguments above follow after in paragraph 200 the AG finds that the provisions of the agreement should be subject to a strict review by the Court regarding their compliance with the requirements resulting also from “the adequacy of the level of protection of the fundamental rights guaranteed in the Union when Canada processes and uses the PNR data pursuant to the agreement envisaged”.

This analysis seems to me contradictory – both by comparing §93 and §203, and by comparing statements within §203. In any case, the consequences of the intention to establish adequacy through an international agreement are not further analysed. The only conclusion the AG draws after identifying the underlying intention of the parties to conclude this agreement is just that “I see no reason why the Court should not carry out a strict review of compliance with the principle of proportionality” (§203). Moreover, he further expands this argumentation by referring to the Schrems case and findings therein concerning “essentially equivalence” and how the means ensuring this equivalence must be “effective in practice” (§204).

Hopefully, the Court in its final Opinion will make a more in depth analysis of this issue.