Tag Archives: Reform of the Database Copyright Directive

EU Commission’s leaked plan for the data economy: new rules for IoT liability and sharing “non-personal data”

It seems that it’s the season of EU leaks on internet and digital policy. One day after the draft new e-Privacy regulation was leaked (to Politico), another document appeared online (published by Euractiv) before its adoption and release – a Communication from the European Commission on “Building a European data economy”.

It announces at least two revisions of existing legal acts: the Database Copyright Directive (96/9) and the Product Liability Directive (85/374). New legislative measures may also be needed to achieve the objectives announced in the draft Communication. However, the Commission is not clear about this and leaves a lot of the decision-making for after the results of wide stakeholder and public consultations are processed.

The common thread of most of the policy areas covered by the Communication is “non-personal data”. The Commission starts from the premise that while the GDPR allows for the free movement of personal data within the EU, there are currently no common rules among Member States for sharing, accessing, transferring “non-personal data”. Moreover, the Commission notes that the number of national measures for data localisation is growing.

“The issue of the free movement of data concerns all types of data: enterprises and actors in the data economy deal with a mixture of personal and non-personal data, machine generated or created by individuals, and data flows and data sets regularly combine these different types of data”, according to the draft Communication.

And what is truly challenging is that “enterprises and actors in the data economy will be dealing with a mixture of personal and non-personal data; data flows and datasets will regularly combine both. Any policy measure must take account of this economic reality”.

If you are wondering what is meant by “non-personal data”, the draft Communication provides some guidance to understand what it refers to. For instance, the draft Communication mentions that “personal data can be turned into non-personal data through the process of anonymisation” and that “the bulk of machine-generated data are not personal data”. Therefore, anonymisation and de-identification techniques will gain even more importance.

While the GDPR covers how personal data are used in the EU, the proposals that will be made on the basis of this Communication envisage the use of all the other data.

So what does the Commission propose?

Several objectives are announced, most of them dealing with the free flow of and access to “non-personal data”, while another objective looks at reforming liability rules to accommodate algorithms, Artificial Intelligence and the Internet of Things.

Free flow of and access to non-personal data

  • According to the draft Communication, any Member State action affecting data storage or processing should be guided by a ‘principle of free movement of data within the EU’.
  • Broader use of open, well-documented Application Programming Interfaces (APIs) could be considered, through technical guidance, including identification and spreading of best practice for companies and public sector bodies.
  • The Commission could issue guidance based on the Trade Secrets Directive, copyright legislation and the Database Directive on how data control rights should be addressed in contracts. The Commission intends to launch the review of the Database Directive in 2017.
  • Access for public interest purposes – public authorities could be granted access to data where this would be in the general interest and would considerably improve the functioning of the public sector, for example access for statistical offices to business data or the optimization of traffic management systems on the basis of real-time data from private vehicles.
  • Selling and acquiring databases could be regulated. “Access against remuneration”: a framework based on fair, non-discriminatory terms could be developed for data holders, such as manufacturers, service providers or other parties, to provide access to the data they hold against remuneration. The Communication is not clear whether this proposal could also cover personal data. In any case, on several occasions throughout the draft Communication, it is mentioned or implied that the GDPR takes precedence over any new rules that would impact the protection of personal data.
  • A data producer’s right to use and licence the use of data could be introduced; by “data producer”, COM understands “the owner or long-term user of the device”. This approach would “open the possibility for users to exploit their data and thereby contribute to unlocking machine-generated data”.
  • Developing further rights to data portability (building on the GDPR data portability right and on the proposed rules on contract for the supply of digital content, further rights to portability of non-personal data could be introduced). The initiatives for data portability would be accompanied by sector specific experiments on standards (which would involve a multi-stakeholder collaboration including standard setters, industry, the technical community, and public authorities).

Rethinking liability rules for the IoT and AI era

Even though Artificial Intelligence is not mentioned as such in the draft Communication, it is clear that the scenario of algorithms making decisions is also envisaged by the announced objective to reform product liability rules, alongside IoT. As the draft Communication recalls, currently, the Products Liability Directive establishes the principle of strict liability, i.e. liability without fault: where a defective product causes damage to a consumer, the manufacturers may be liable even without negligence or fault on their part. The current rules are only addressed to the producer, always require a defect and that the causality between the defect and the damage has to be proven.

The Commission proposed two approaches, which will be subject to consultation:

  • “Risk-generating or risk-management approaches: liability would be assigned to the market players generating a major risk for others and benefitting from the relevant device, product or service or to those which are best placed to minimize or avoid the realization of the risk.”
  • Voluntary or mandatory insurance schemes: they would compensate the parties who suffered the damage; this approach would need to provide legal protection to investments made by business while reassuring victims regarding fair compensation or appropriate insurance in case of damage.”

“Connected and automated driving” – used as test case

The Commission intends to test all the proposed legal solutions, after engaging in wide consultations, in a real life scenario and proposes “connected and automated driving” as the test case.

Finally, read all of these objectives and proposals having in mind that they come from a draft document that was leaked to Euractiv. It is possible that by the time of adoption and publication of this Communication (and there is no indication as to when it will be officially published) its content will be altered.

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