10/25/13 Victoryfor tech giants on EU data lam - FT.com
FINANCIAL TIMES

October 25, 2013 5:22 pm Victory for tech giants on EU data laws

By James Fontanella-Khan in Brussels

UK premier David Cameron and German chancellor Angela Merkel at the EU summit in Brussels on Friday
JO-len we saw the story about Merkel's phone being tapped anu that 35 leaders' phones were also compromised, we thought we were goinl to lose ... Britain's common sense - executive at large US tech
company US tech giants such as Google and Facebook have won a major victory against EU efforts to restrict the sharing of customer data after UK prime minister David Cameron persuaded officials to put off increasing privacy protection by at least a year.

The decision to hold back on adoption of new rules at the peak of a scandal that has seen the US accused of snooping on millions of European citizens and leaders is a huge blow to European ambitions for stricter data protection standards.
The postponement will give US companies — as well as the Obama administration, which has been frantically lobbying for the watering-down of the reforms — the opportunity to make their case more forcefully once the attention shifts away from the US spy scandal, said some EU officials and privacy advocates.

Tech lobbyists were alarmed this week by the European Parliament's decision to amend the EU's draft data privacy legislation to limit the US's ability to spy on EU citizens. The measure had been stripped from the original proposal, made by the European Commission in January 2012, after intense lobbying from US officials.

US companies also want to scrap — or at least lower — sanctions for breaching any new regulations, which could cost companies such as Google, Facebook and Amazon heavily. The parliament increased the fines originally proposed by the commission to 5 per cent of annual global revenues or eloom, whichever is greater.

Senior EU officials said Mr Cameron had spearheaded getting the date moved to 2015. "They don't like the directive as it is," said a top Brussels official. "It is burdensome, they say. They wanted to have a reference to more timely adoption. So the compromise was therefore the reference to 2015."
At an EU summit, Mr Cameron initially opposed setting a timetable for new data rules. But agreed to compromise on 2015 after France, Italy and Poland pushed for the proposal to be completed before European elections next spring.

Germany — to the surprise of many of the 28 leaders present at the meeting — did not take sides, said an EU diplomat: "The Germans have been very ambiguous."
Angela Merkel, German chancellor, accused the US of tapping her phone on Wednesday, prompting her to launch a separate initiative with France to renegotiate their intelligence services' co-operation with America.

Britain has echoed the concerns of US tech groups that the legislation would create a conflict between American and European legislation as well as burden companies with unnecessary red-tape during a difficult economic recovery.

"It looks like we won," said an executive at a large US tech company. "When we saw the story about Merkel's phone being tapped and that 35 leaders' phones were also compromised, we thought we were going to lose ... Britain's common sense prevailed."

One of David Cameron's aides said on Friday that he had "no idea" whether the prime minister had discussed the data protection rules with Eric Schmidt, the chairman of Google, who sits on the prime minister's business advisory board.

But he insisted that Google was "not the reason why" the prime minister had fought against early adoption of the rules. "As offered it contains huge extra burdens on businesses so there has to be some changes to it, that is why we got it removed."

Herman Van Rompuy, the European Council president, said in the early hours of Friday that several countries had been concerned that a rushed proposal could harm businesses that heavily depended on personal customer data.

"What is the problem? ... It is a complex task not only related to the already difficult issues of protecting privacy but it also [has] an impact on business, so we have to study this carefully," said Mr Van Rompuy.

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