New Data Act proposed by the European Commission for a fair and innovative data economy.
The European Commission recently proposed a new Data Act with the aim of making data more accessible. According to a press release from the Commission, this will make more data available for reuse and this is expected to create an additional €270 billion in GDP by 2028. This is expected to stimulate a competitive data market, open opportunities for data-driven innovation and make data more accessible for all. This is the second main legislative initiative resulting from the February 2020 European strategy for data, following the Data Governance Act. While the Data Governance Act creates the processes and structures to facilitate data sharing by companies, individuals and the public sector, the Data Act clarifies who can create value from data and under which conditions.
The proposal for the new Data Act includes several measures with the overall aim of ensuring fairness in the digital environment.
The proposed Data Act includes several measures for businesses, organisations and consumers alike. It includes rules allowing customers to effectively switch between various cloud data-processing services providers and implementing safeguards against unlawful data transfer. Data generated by users of connected devices, which is often exclusively harvested by manufacturers, will be available for sharing among those users, as well as third parties which aim to provide aftermarket or other data-driven innovative services. This is expected to incentivize high quality data generation for manufacturers by covering their transfer-related costs and excluding use of shared data in direct competition with their product.
The proposed Data Act aims to implement measures that will protect and aid small to medium enterprises and public sector bodies as well.
The new Data Act being proposed by the European Commission includes measures to rebalance negotiating power for small to medium enterprises by preventing the abuse of contractual imbalances in data sharing contracts. The new Data Act will shield them from unfair contractual terms imposed by a party which has a significantly stronger bargaining position. In an effort to help these companies to draft and negotiate more fair data-sharing contracts, the Commission will also develop model contractual terms. This new Data Act is also intended to provide the means for public sector bodies to access and use data held by the private sector that is necessary for exceptional circumstances, particularly in case of a public emergency, such as natural disasters, or to implement a legal mandate if the data is not otherwise available. In cases where insights are needed to respond quickly and securely, the Data Act will allow them to access the necessary data, while minimising the burden on businesses.
This new Data Act builds on pre-existing legislation, to improve the overall atmosphere in the data sharing community.
The proposed Data Act reviews certain aspects of the Database Directive, which was created in the 1990s to protect investments in the structured presentation of data. In particular, this new Data Act clarifies that databases containing data from Internet-of-Things (IoT) devices and objects should not be subject to separate legal protection. This change will ensure that this data can be accessed and utilised. An open public consultation on the Data Act ran between 3 June and 3 September 2021 and gathered views on measures to create fairness in data sharing, value for consumers and businesses, the results of which were published in December of last year. Margrethe Vestager, Executive Vice-President for a Europe fit for the Digital Age, said: “We want to give consumers and companies even more control over what can be done with their data, clarifying who can access data and on what terms. This is a key Digital Principle that will contribute to creating a solid and fair data-driven economy and guide the Digital transformation by 2030.”
