US Criticises European Anti-Spying Internet Proposals

The office of the US Trade Representative (USTR) has criticised proposals in Europe to place controls on the circulation of data, saying that the proposals could create unfair trade barriers for non-European companies.

The USTR’s comments targeted both Europe-wide proposals, such as the “virtual Schengen border” suggested by the EU in 2011 as a way of addressing security issues such as fraud and terrorism, and national Internet restrictions, such as a plan being investigated by Deutsche Telekom to protect German citizens from surveillance by foreign powers.

‘Schengen cloud’

“Recent proposals from countries within the European Union to create a Europe-only electronic network (dubbed a ‘Schengen cloud’ by advocates) or to create national-only electronic networks could potentially lead to effective exclusion or discrimination against foreign service suppliers that are directly offering network services, or dependent on them,” the USTR said.

In its report, an annual review of telecommunications trade barriers, the USTR said data routing control proposals by Deutsche Telekom were “draconian”, and said EU plans could conflict with international trade law.

“Any mandatory intra-EU routing may raise questions with respect to compliance with the EU’s trade obligations with respect to Internet-enabled services,” the USTR stated. “Accordingly, USTR will be carefully monitoring the development of any such proposals.”

In 2011, the European Union had already suggested the “virtual Schengen border” as a cyber-security measure. The term is a reference to the treaty that allows free circulation within the EU, but strictly controls access to the European continent.

Surveillance fears

Interest in such protections has gained momentum more recently with the revelations by former NSA contractor Edward Snowden of large-scale data surveillance by the US government, allegedly including a tap on the phone of German Chancellor Angela Merkel.

In February, Merkel met with French president François Hollande to discuss the establishment of better security for European data.

“One shouldn’t have to send emails and other information across the Atlantic. Rather, one could build up a communication network inside Europe,” Merkel said at the time.

Within Germany, Deutsche Telekom, 32 percent of which is owned by the German government, proposed plans which would route domestic web traffic within the country.

The European Commission has also warned it may scrap the Safe Harbour agreement, which facilitates data sharing with US-based companies, due to the US’ surveillance practices. In November 2013, the EC provided the US with recommendations on how its practices could be brought into line with EU data protection laws, warning that Safe Harbour could be scrapped as early as the summer of 2014 if the recommendations are not followed.

“There is always a possibility to scrap Safe Harbour,” said Viviane Reding, the European Commissioner for Justice, Fundamental Rights and Citizenship, at the time. “Safe Harbour cannot be only an empty shell.”

Canada criticism

The USTR’s report also criticised the federal government of Canada, which is building a unified email system that requires data to be stored within the country.

“In today’s information-based economy, particularly where a broad range of services are moving to ‘cloud’-based delivery where US firms are market leaders, this law hinders US exports of a wide array of products and services,” the USTR stated.

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