On October 5, while the European Union’s highest court was busy striking down its Safe Harbor permitting the cross-border transfer of personally identifiable information, 12 countries reached a consensus on data transfers under a similar regime with the potential to affect those storing data in the Asia Pacific region. The Trans-Pacific Partnership (TPP) is a multilateral trade agreement that has been in the works for eight years between the United States, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
While the TPP focuses on creating an economic bloc with reduced trade barriers for certain products, it also includes rules governing data flows. The full text of the TPP is not yet publicly available, as the negotiations have been largely kept secret. However, some details have emerged regarding the TPP’s abolition of data protectionism.
The snippets of information that have been released suggest that the TPP will be the first international agreement to prevent governments from blocking the free flow of data across borders. Furthermore, signatories to the TPP will not be permitted to block cross-border Internet-based transfers of data, and TPP signatories cannot require businesses to build data centers in their countries in order to do business there, facilitating the use of cloud-based storage. These restrictions could conflict with some nations’ laws that limit the offshore storage or transmission of certain types of data, particularly personally identifiable information.
The TPP will not become effective until all members ratify and sign it. The final deal could be a difficult sell to some members of Congress given some controversial commercial provisions, including some rules governing the pharmaceutical industry; other nations with strict data-privacy regimes may have qualms with the agreement’s terms. Potential signatories that currently have restrictive data transfer laws in place include Australia, Japan, Malaysia, Singapore and Vietnam.
We will follow the status of the TPP and keep you updated.