The European Commission developed a Directive on Data Protection which was put into effect in 1998. The protection plan was designed to prohibit personal data to countries that are not in Europe and specifically to countries that do not meet their high standard of privacy protection. The United States and the European Union have different approaches to protecting citizen’s privacy. The “Safe Harbor” framework was designed to help bridge the differences between the two regions. Safe Harbor Privacy Principles made it possible for organizations doing business with the EU to abide by the Swiss data protection laws. Companies are encouraged to join the Safe Harbor framework so that consumer’s personal data is protected during international transactions.

Requirements of Safe Harbor

There are some stipulations required by Safe Harbor. In order to be able to collect data from consumers in EU countries, businesses in the US have to comply with these stipulations. IN essence they must agree to follow the seven principles of Safe Harbor which include:

  • Notifying individuals that their personal data is being collected
  • Giving consumers choices about how their personal data is to be used
  • Ensuring that personal data will be accurate and dealt with in integrity
  • Allowing consumers access to the data which was collected and allowed to correct it if needed
  • Protecting the security of personal data
  • Complying with restrictions regarding transferring of the collected data
  • Providing independent dispute resolution for complaints about data collection

Establishing an Agreement

The agreement between the US and the EU helps provide a solution for privacy issues. The 15 member countries must remain subject to the agreement. This simply means that data transfers are allowed to proceed without having to obtain authorization from each individual. US companies that fail to join Safe Harbor have to obtain authorization from each of the European countries separately. Organizations in the EU have access to a list of US companies that have jointed Safe Harbor and have agreed to follow the principle as they are set forth.