Facebook's data transfer of users' personal information from the EU to US faces another legal hurdle as Ireland's privacy watchdog has launched a bid to refer the mechanism to Europe's top court. Hearing in the case commenced at the Irish High Court in Dublin on 7 February and any decision could threaten the cross-border data transfer process.
Tech giants such as Google, Apple among other firms use the same mechanism to move EU citizens' personal data to the US. Ireland's data protection commissioner Helen Dixon, who has jurisdiction over Facebook, given its European headquarters is in Dublin, wants the EU Court of Justice (CJEU) to determine the validity of the social media giant's "model contracts". This refers to the common legal arrangements used by various companies to move data outside the EU.
According to Dixon, the complaints made against the model contracts are "well founded", Michael Collins, a lawyer for the commissioner told Ireland's High Court, Reuters reported.
"If you share her doubts - it doesn't mean you have to be finally satisfied - then you must make a reference to the European Court... The Commissioner's concern is simply to get it right, not to advocate for any particular result," Collins said.
Collins argued that data transfer can only be made to a country outside the EU if the country is able to ensure adequate level of protection. He added that only the CJEU – and not a national court or the data protection commissioner – has the jurisdiction to provide a ruling that would invalidate the EU Commission's decision on the matter.
The hearing is slated to last three weeks and Facebook will also present its arguments before the court.
A Facebook spokesperson told TechCrunch, "Standard Contract Clauses provide critical safeguards, protecting EU citizens data' in the US and around the world, and are used by thousands of companies to do business. Facebook firmly believes that SCCs are integral to businesses of all sizes, and upholding them is critical to ensuring the economy can continue to grow without disruption.
"While there is no immediate impact for people or businesses who use our services, we are pleased to have the opportunity to provide input in this process. It is essential that the court has the opportunity to consider the full facts before it makes any decision that may impact the European economy."
A ruling against the model clauses could cause major issues for tech firms looking to transfer data to the US. It could also impact processing credit card transactions, hotel bookings or transferring employee data between countries.
The main issue surrounding the case is whether US surveillance activities can be made compatible with EU privacy laws. Ireland's Hight Court has agreed to a request to allow the US government to join the case, potentially providing the new administration a chance to put forth its views on surveillance laws.