It is well known that the EU rules on personal data protection (set out in Directive 95/46/EC and implementing national law) are rather stringent when it comes to the transfer of personal data outside the European Economic Area (EEA), including the input of personal data originating in the EU on a server outside the EEA. Such transfers are, in principle, prohibited if the country to which the data is being sent does not offer an adequate level of protection. The US, India, Russia and South Korea all fall into this category.
Nevertheless, personal data can be transferred to such countries if, e.g., the data subject has given his or her express consent or if the transfer is necessary to prepare or perform a contract with or in the interest of the data subject. In addition to these exceptional circumstances, which are often difficult to rely on in practice, EU national data protection authorities ("DPAs") can authorise the transfer of personal data to countries not deemed to offer an adequate level of protection if "the controller introduces adequate safeguards to protect the privacy and fundamental rights and freedoms of the data subjects". Such safeguards may in particular result from contractual clauses between the data controller and the entity outside the EU to which the data are being transferred. Reliance on standard clauses will speed up the authorisation process before the national DPA (in Luxembourg, the CNPD) and, in some countries (such as Belgium), no further authorisation is required.
While contractual clauses are generally sufficient to assuage privacy concerns in well-identified bilateral data flows between an EU and a non-EU entity, they may not suffice in the context of complex data transfers between multinationals. In order to ensure adequate data protection within multinational groups transferring personal data from the EU to third countries, the so-called Article 29 Working Group, a group composed of representatives of the European Commission, the data protection authorities of the EU, and all EU Member States, has developed the concept of binding corporate rules (BCRs).
BCRs are internal rules of a multinational that define the group's global policy with regard to intra-group international transfers of personal data to, amongst others, group entities located in countries which do not offer an adequate level of protection. The rules must ensure that such data transfers are subject to equivalent protection as...