The EU’s Data Act Gets Agreement

Under the tripartite system by which the EU adopts its legislation, the European Parliament, the Council of Ministers and the European Commission managed to strike a deal on the EU Data Act at the end of June. The Data Act will lay down harmonised rules on fair access to and use of data in order to pave the way for the EU’s data economy and promises to unlock the great potential of industrial data generated by Internet-of-Things (IoT) products and related services. At present in Europe only 20% of such data is currently being used. The new Regulation promises to incentivise data-driven innovation and stimulate a competitive data market by removing barriers to access and share data, and make data more accessible to all, so that data users can be empowered to take ownership of the data they generate.

According to our European colleagues at Ecommerce Europe, one of the most controversial aspects of the Data Act was a requirement that government should access private company information. This proposal has been significantly watered down. On a more general note, the EU’s new legislation also makes it easier for customers to switch between different cloud providers, as well as introducing rules to prevent abuse of contractual imbalances in data sharing contracts, which will assist the negotiating power of SMEs. Finally, the Data Act also provides additional guidance on reasonable compensation for businesses which make data available.