LIBE committee raises concerns about Data Protection and Digital Information Bill to UK government and European Commission.

The Committee on Civil Liberties, Justice and Home Affairs (LIBE Committee) has written to the Chair of the European Committee in the House of Lords to warn that “UK divergence from EU data standards, [is] putting the validity of the adequacy findings into question”. The Committee notes that it has been closely following the progress of data reform in the UK, as both adequacy agreements with the EU “contain sunset clauses, and thus will automatically expire four years after their entry into force”.

The key areas of concern noted by the LIBE Committee are:

• Change to definition of personal data
  The Committee notes that: “the Bill modifies the concept of “personal data” that is at the heart of the EU data protection regime”.

• Threats to the independence of the Information Commissioner’s Office
  The letter notes that, “the Bill appears to further undermine, not merely the effectiveness, but beyond that the independence of the ICO”.

• Data transfers
  The committee is “strongly concerned” that the Bill would lead to the “bypassing of EU rules on international transfers to countries or international organisations not deemed adequate under EU law”.

The letter also reminds the UK parliament of its human rights obligations and notes that, “any possible changes to the UK’s Human Rights Act or the UK’s departure from ECHR jurisprudence would, in the opinion of the LIBE Committee, have a negative impact on the UK adequacy”.

Mariano delli Santi, Legal and Policy Officer for Open Rights Group said:

“Losing the adequacy agreement would be a disaster for the UK economy. As the Bill enters its final stages, the Government needs to act urgently to protect our data protection rights.

The concerns of the LIBE committee highlights how the data rights of people in the UK will be reduced compared to people living in Europe. This should not be acceptable to our parliamentarians.”

Cost of breaching the adequacy agreement

After Brexit, the European Commission adopted two adequacy decisions on, which allowed for the free flow of personal data between the UK and the EU, without requiring additional safeguards. Losing such status would add significant red tape for UK businesses, disrupt trade, and would risk undermining important cooperation initiatives between the EU and the UK such as data sharing for research (Horizon), law enforcement (Prum) or immigration control purposes (Frontex). The cost to UK businesses has been estimated at £1-1.6 billion in legal fees alone.

Warning to the European Commission

The LIBE Committee previously wrote to the European Commissioner, Didier Reynders, in March, noting that the DPDI Bill still had “many controversial provisions unchanged (such as lack of independence of supervisory authority or the removal of the Biometrics and Surveillance Camera Commissioner, which oversees the sharing of DNA and fingerprint data under Prüm cooperation with the EU)”. Another MEP tabled a written question only some weeks before, asking if the Commission intends to revoke the UK adequacy decision. The European Commission have already confirmed that some changes of the DPDI Bill would raise concerns in a response to a written question and to the LIBE committee last year.

Civil society concerns

In July 2023, 28 civil society organisations wrote to the European Commission to raise concerns that to raise concerns that UK’s data protection reform would undermine European citizens’ data protection rights, thereby threatening the adequacy agreement.

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https://www.openrightsgroup.org/press-releases/europe-warns-of-threat-to-adequacy-agreement/

POLITICO’s weekly transatlantic tech newsletter for global technology elites and political influencers.

By MARK SCOTT

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WELCOME BACK TO DIGITAL BRIDGE. I’m Mark Scott, POLITICO’s chief technology correspondent, and I’m filing this dispatch from Chișinău, the capital of Moldova (more on that in a couple of weeks). I hadn’t realized the official language of this Eastern European country is Romanian; I hang my head in shame.

Să ajungem la asta (or, “Let’s get to it,” in Romanian):

— Four of the West’s leading social media regulators drop by to explain what they are really focusing on after the creation of a series of content regimes.

— Washington’s decision to force the sale of TikTok on national security grounds is not how you should go about digital policymaking.

— Microsoft is quickly becoming a dominant force in artificial intelligence. But its spate of dealmaking is unlikely to break existing antitrust rules.

FANTASTIC FOUR OF SOCIAL MEDIA

THE UNITED KINGDOM’S MELANIE DAWES. Australia’s Julie Inman Grant. France’s Benoît Loutrel. Ireland’s Jeremy Godfrey. Unless you’re steeped in digital wonkery, those names don’t mean much. But to those of us following the growing list of national social media rulebooks, they represent a hefty chunk of the Western regulatory muscle that will be pulling the levers on how Meta, Alphabet and ByteDance tackle everything from child online sexual abuse material to potential digital election interference. Over the last six months, I’ve sat down (sometimes virtually) with these officials — some of whom have already been labeled “censorship police” for efforts to hold companies to existing national rules. In truth, the reality of social media oversight is more regulatory geekdom, less breaking down doors in dawn raids.

For Dawes, head of the U.K.’s Office of Communications, or Ofcom, the country’s Online Safety Act, a cavalcade of social media rules, isn’t really about social media, per se. “It’s about systems and processes,” the long-serving British official told me last November. “It’s about the design of the (social media) service that does include things like the recommender algorithms and how they work.” I can already see some of your eyes glaze over. But this context is important. All four regulators aren’t focusing their attention, mostly, on specific pieces of content. Instead, they are looking at how digital platforms operate, as a whole, and then forcing companies to mitigate collective abuse. In short: This is not about creating a Ministry of Truth.

The same softly-softly approach is something Ireland’s Godfrey is pursuing as head of the country’s media regulator, Coimisiún na Meán. The British-born official has a multimillion-euro budget and new powers — under the European Union’s Digital Services Act — to hold platforms to account. It helps that many are based in Dublin, which makes them, partly at least, fall under his jurisdiction. But, like Dawes, he cautions patience. “It’s going to take a bit of time [to work out the logistics of enforcement],” he acknowledged when I visited him at the end of last year. “I don’t think any of us want to duplicate what others are doing. There’s no sense in having a turf war.” By that, he wants to avoid squabbles with the European Commission, which also has the power to enforce the bloc’s new social media rules. How Brussels and Dublin work with each other — so far, I’m told it’s going relatively well — will be crucial in holding social media companies to account.

France’s Loutrel is another key part of that EU-wide enforcement. While his agency Arcom — l’Autorité de régulation de la communication audiovisuelle et numérique — has no Big Tech players under its direct oversight, Paris has positioned itself as the ‘big brain” on which Brussels can rely for technical expertise. Loutrel, as the regulator’s point man on European cooperation, is central to that. “I’ve never seen a game like this where we are so prepared and where there are so many dynamics to work to implement a new piece of legislation,” he told me, more optimistically (naively?) than I would have imagined. “We are bringing something new to what we have done in the past. It’s a new model. For the first time, we are not the French regulator. We are the French player of the EU team of regulation.”

Into that mix, enter Australia’s Inman Grant. The American-born Aussie regulator is the pseudo-godmother of online safety overseers, mostly because her agency has been around the longest. But annoyingly for Inman Grant, she has limited powers as the country’s eSafety Commissioner — mostly related to cyberbullying and child sexual abuse material. Still, given the limited scope for enforcement, the former Twitter executive hasn’t been afraid to throw her weight around, including an ongoing legal fight with Elon Musk’s X. “We know that building products with safety in mind runs counter to the business model,” she told me, referring to how social media giants maximize users’ experiences to keep them on these platforms. “You can’t tell me you care about children’s safety or women’s safety when you’re providing 30 different parental controls and well-being tools. That’s retrofitting tools after the damage has been done.”

Expect to hear more coordinated work from these officials. Their agencies are all part of the so-called Global Online Safety Regulators Network, a loosely affiliated group that also includes regulators from South Africa, South Korea and Fiji. The U.K.’s Ofcom holds the one-year rotating presidency this year after Australia’s eSafety Commissioner inaugurated the network in 2023. What exactly these coordinated efforts will look like, frankly, is a work in progress, especially as each country has different regulatory requirements. The Australians, for instance, are currently reviewing a potential revamp of their own national Online Safety Act.

What I take from my interactions with these online safety regulators is two-fold. First: There’s a coherent effort to balance legitimate free speech rights and the need to uphold national law. Almost no one wants to adjudicate specific social media posts. Instead, there’s a focus on how these platforms, as a whole, operate — with a lot left to the companies to figure out for themselves. Second: More coordination is needed. No one expects the French to work in the same way as the Australians. But these social media giants are global operators. So a global response — in terms of what platform information is requested from officials, how agencies share information among each other, and how companies interact with individual regulators — is equally required. My bet: that focus on such international cooperation will be crucial over the next two years for the litany of national social media rules to truly be effective.

WASHINGTON TO BEIJING: WE SEE YOU ON TIKTOK

SO, IT’S OFFICIAL. ON WEDNESDAY AFTERNOON, U.S. President Joe Biden signed a bill — nominally to provide much-needed aid to Ukraine — that requires ByteDance, the owner of the popular video-sharing app TikTok, to either sell the platform within a year or face a nationwide ban. Not surprisingly, the company rejects claims (we’ll get to them) that it’s under the thumb of the Chinese Communist Party and therefore represents a national security threat. The company will almost certainly challenge the forced sale in court. If legal precedent is anything to go by, it has an above 50 percent chance of winning, based on the First Amendment implications of the United States government banning a specific social media platform.

Where to begin? Let’s start where many end: the national security concerns. U.S. government official after official claim TikTok is a threat. Those allegations focus on two unsubstantiated (publicly) assertions: that Beijing can use the popular social media platform in its influence campaigns; and that it can tap into Americans’ sensitive data in ways that may cause harm. Can’t believe I’m saying this, but even though I’m no fan of authoritarian regimes, neither of those accusations has ever been proved publicly, at scale. Sure, there have been leaks, including court documents that claim China’s owed access TikTok’s data. But actual, hard evidence of Beijing doing what Washington suggests? Nada (again, at least not publicly).

But what about China’s National Intelligence Law, I can hear the geeky of you asking? That legislation (particularly Article 7) gives Beijing blanket powers to force organizations like ByteDance to hand over anything — and I mean anything — related to China’s national security interests. Despite what TikTok officials and those of its China-based owner, ByteDance, claim, there’s no way they can get around that law, which, to be clear, is extra-territorial by design. “It’s basically an instrument of state power,” Kenton Thibaut, a China expert at the Atlantic Council’s DFR Lab, told me. “There’s really no rule of law protecting company’s property from having to be turned over to the authorities.”

Freaking out yet? Many in Washington would like you to think so. It’s not as if China — in terms of influence operations and aggressive data collection — is not a problem. It’s just that the proposed solution — the forced sale of TikTok on national security grounds — is not a good way to solve it. “There’s a genuine desire, on the part of lawmakers, to address a national security risk, but they are doing it in the wrong way,” said Rose Jackson, another Atlantic Council expert who, along with Thibaut and others, published an in-depth report into the U.S. government’s response to TikTok. For the former State Department official, the focus should be on setting standards from which Washington can measure the harm of actions from a foreign adversary; national rules that mandate specific obligations, including on companies owned by foreigners; and a willingness to promote an open, free internet that espouses the values of the West’s leading (but often dysfunctioning) democracy.

“The bigger issue,” Jackson added, “is that (the forced TikTok sale) is completely counter to the kind of core policy and approach that the United States has pushed throughout the creation of the internet and the digital world.” That includes the willingness, in the so-called information environment, to let adversaries make their pitch directly to U.S. citizens — as a trade-off for Americans to access digital services in ways off-limits to those in authoritarian regimes. “It’s essential to the survival of the competitive open, free flow of information, innovation and economic opportunity that we need in an interconnected global world that sits on that digital infrastructure.”

So we have a policy here that does not meet the bar — IMHO — required to publicly substantiate a legitimate national security threat to the U.S. It also undermines Washington’s decades-old stance toward an open, free internet. I appreciate that American lawmakers view this via the prism of domestic policy. But to suggest others — allies and adversaries alike — won’t be scratching their heads at such a quixotic and fast response to an arguably significant concern is foolhardy. What the U.S. does — even in the digital policy space where, frankly, it has been missing for decades — still matters. And this heavy-handed approach to tackling a national security threat (one that is legitimate, but unproven) does Washington a disservice.

Let’s be clear: It’s not how good policy is made. How can the U.S. legitimately push back against China when that authoritarian regime bans an American digital service? Or how can Washington complain to Brussels when the EU takes a position against a U.S. tech giant that, from the other side of the Atlantic, appears to be protectionist? How can U.S. policymakers look their counterparts in developing countries in the eye to urge them to turn away from a China-style closed internet in favor of an American-frame open one? I get that none of these questions were discussed, really, during the short time it took to get the TikTok forced sale through both houses of Congresses and onto Biden’s desk. But the fact they weren’t — or, at least, not seriously — speaks volumes, too.

**Get ready for the upcoming Maastricht Debate, join us and our newly announced candidate Ursula Von der Leyen - European Commission President. This edition of the Maastricht Debate is not to miss, join us online and partake in democracy alongside some of the most influential voices in the EU. Register here.**

BY THE NUMBERS

WHEN DOES AI DEALMAKING BECOME ANTICOMPETITIVE

THE UNITED KINDOM’S COMPETITION AUTHORITY has a bee in its bonnet about how Microsoft is gobbling up the world of artificial intelligence. After raising questions about the tech giant’s partnership with OpenAI, Britain’s Competition and Markets Authority is now asking whether Microsoft overstepped in its commercial dealings with Mistral, a French AI firm, and its so-called acquire-hire deal for the top management at InflectionAI. U.K. regulators are similarly probing Amazon’s $4 billion investment in Anthropic.

It’s fair that antitrust regulators should be concerned that a small handful of cash-rich (American) tech companies are scooping up stakes in a new generation of AI startups. If you throw in the growing need for computing power and high-end microchips, a few firms already dominate an industry that will become central to how much of our daily life will play out in the years to come.

And yet, my ongoing question is: Where is the anticompetitive harm? Let’s take Microsoft. Their partnerships with both OpenAI and Mistral could lead to market concentration. But such investments don’t currently break any antitrust rules. Similar to the hiring of Mustafa Suleyman, the co-founder of Deepemind and InflectionAI. His appointment as one of the heads of Microsoft’s AI development may appear unfair. But, again, has it broken any rules to hire a top AI guru? My (non-legal) opinion remains: no.

WONK OF THE WEEK

THE MILITARY ARE TURNING THEIR HEADS toward AI. So, this week, we’re focusing on Craig Martell, the recently appointed chief digital and artificial intelligence officer at the U.S. Department of Defense.

Before his appointment, the Ph.D.-holding computer scientist was head of machine learning at Lyft, the ride-sharing app, and was previously a leading computer science academic at the U.S. Naval Postgraduate School.

“Imagine a world where combatant commanders can see everything they need to see to make strategic decisions,” Martell told an audience in February. “Winning, for us, is when everyone else thinks, ‘I launched AI; I solved this data problem.’ I quickly leveraged data to build an analytical solution that solved my commander’s problem right away.”

**We’re celebrating the first-year anniversary of POLITICO’s Research & Analysis Division! That’s 365 days of delivering clarity through ready-to-use reports and hours of work creating policy intelligence for our readers, but we’ll spare you the details. Watch our video putting together the figures that stood out to us to see what we’re all about.**

THEY SAID WHAT, NOW?

“TikTok always seeks to engage constructively with the EU Commission and other regulators,” the Chinese-owned company said in response to Brussels’ claims that its new services, which compensated people for spending time on the social network, may have breached the bloc’s digital rules. “We are therefore voluntarily suspending the rewards functions in TikTok Lite while we address the concerns that they have raised.”

WHAT I’M READING

— A group of former national leaders has written to several social media and artificial intelligence companies to urge them to do more to protect democratic institutions in this year of elections. A number of nonprofits also threw their hat in the ring with a separate letter.

— Politicians in developing economies are increasingly turning to social media influencers to promote their partisan messages directly to voters, according to research from the TechGlobal Institute.

— Microsoft extended a number of AI-focused technical tools to almost all politicians worldwide to defend against potentially harmful content spreading during upcoming campaigns. More here.

— The Mozilla Foundation has created an online database that tracks use cases for AI and how those affect key social issues like human rights, racial justice and community health security.

— Snapchat pulled together all that it’s doing to protect election integrity, including its approach to political ads and product safeguards. More here.

— Alicia Wanless, a researcher at the Carnegie Endowment for International Peace, wrote a (mostly) first-person view on how changes in the so-called information environment have affected her. It’s worth a read.

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