Tuesday

4th Oct 2022

EU bank data move ignored legal advice

  • Over 8,300 banking organisations in more than 208 countries use SWIFT. (Photo: SWIFT)

EU member states laid aside the advice of their own legal experts in cutting MEPs out of talks on a new bank data deal with the US.

The legal services of the EU council (the member states' secretariat in Brussels) in July put forward a confidential paper saying that the European Parliament should have co-legislative powers on the pact under articles 95 and 300 of the EU treaty, EUobserver has learned.

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But EU foreign ministers on Monday (27 July) opted to give the Swedish presidency the exclusive right to handle talks, citing articles 38 and 24 instead.

"It's not that dramatic," an EU official said. "The council often follows the opinion of its legal services, but not always."

Dutch liberal MEP Sophie in 't Veld sees the move as an affront to democratic principles.

"It's unacceptable that the council resorts to these backroom deals," she said. "It's time the EU started sharing information with its citizens, not just about its citizens."

Ms in 't Veld on Tuesday formally requested to see a copy of the dud legal opinion. The Dutch deputy plans to bring a case on transparency to the European Court of Justice if she is refused access.

The new data pact will give US treasury officials the right to peek into EU citizens' banking transactions to investigate potential terrorist activity.

The US already has access to data circulating inside Swift, a major Belgium-based financial services firm with operations in America.

But Swift will in October put online a new "distributive architecture" that is to segregate EU data inside servers in the Netherlands and Switzerland.

Swedish officials have since Monday already held meetings with US counterparts in a race to get the new deal in place before October. The pact is to stretch to other EU companies providing financial services, such as British Telecom.

The new deal will be valid for 12 months. The EU intends to negotiate a permanent pact once the Lisbon treaty enters into life. The Lisbon-based agreement, which will involve MEPs, is to supercede the interim deal the moment it comes into force.

The interim pact - which will serve as a model for the permanent agreement - is to include clauses on reciprocity, giving EU governments the right to poke around in US bank transactions.

The European Commission has said it will not put forward before 2010 proposals to set up an EU system along the lines of the US' Terrorist Finance Tracking Programme. But the idea is doing the rounds in Brussels.

"It's up to the politicians to design the boundaries between privacy, security and public interest," Swift spokesman Euan Sellar told this website.

"There is no intention at the Swedish presidency to bypass the European Parliament," Swedish justice ministry spokesman Martin Valfrdisson said. "There is no intention to hide anything from MEPs."

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