9th Mar 2021

EU stalls bank data deal with US ahead of Lisbon Treaty

  • The Belgian company plans to move its back-up database from the US to Switzerland (Photo: SWIFT)

Opposition from four member states to a draft agreement between the EU and US allowing the use of banking data in anti-terrorist investigations is likely to delay a decision until after 1 December, drawing the European Parliament into the decision making process.

Citing data privacy concerns, Germany, Austria, France and Finland are opposing the text negotiated by the Swedish EU presidency and the European Commission allowing American authorities access to information from the Society for Worldwide Interbank Financial Telecommunication (Swift) - the interbank transfer service.

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Since 2006, Swift had been in the centre of a major EU-US row, after it emerged that the American authorities had been secretly using information on European transactions as part of the so-called War on Terror.

A Belgium-based company, Swift keeps a backup database on US soil, which the Bush administration was using in the context of terrorist investigations.

The company records international transactions worth trillions of dollars daily, between nearly 8,000 financial institutions in over 200 countries. It is about to set up a Switzerland-based back-up database, which will allow for the European information no longer to be stored in the US, which is why the Obama administration is negotiating a legal framework for data exchange with the EU, to enter into force next year.

The Swedish EU presidency was hoping to reach a deal done on 30 November, when EU justice and home affairs ministers are set to meet in Brussels.

But German justice minister Sabine Leutheusser-Schnarrenberger, a liberal politician, said she was against a deal which allowed large quantities of data to be transferred without "legal protection provisions" in place, she told the Berliner Zeitung on Thursday (12 November).

Her comments were echoed by Austrian interior minister Maria Fekter, who said she would also oppose the deal.

According to the draft proposal, the EU would allow Swift to share the "name, account number, address, national identification number, and other personal data" with US authorities, if there is a suspicion that the person is in any way involved with terrorist activity.

The requests for information "shall be tailored as narrowly as possible" to prevent too much customer data from being evaluated by police and intelligence officers.

However, if the provider of data "cannot identify the data that would respond to the request for technical reasons, all potentially relevant data shall be transmitted in bulk" to the state that requests it. Eurjust, the bloc's judicial co-operation agency, is also set to be informed by the information request.

The transmitted data may be kept in the US for up to five years before being deleted.

Postponing a decision on the deal beyond 30 November will have other legal implications, as the European Parliament will have a bigger say in the decision-making process once the Lisbon Treaty enters into force on 1 December.

A sneak preview of the EU legislature's co-decision right in the field of justice and home affairs was offered on Thursday, when a joint session of the parliament's three legal committees tabled almost 500 amendments to a resolution in this area.

One MEP asked for the vote to be postponed, as not all amendments had been translated in time for all his colleagues to read, which meant that some would not know what they were voting on. His request was rejected and the resolution approved after over two hours of voting.

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