The 25 May 2018 marked the fifth anniversary of the General Data Protection Regulation ("GDPR"), and it is clear that the pace of legal and regulatory developments in this area is showing no sign of letting up.
The GDPR is a regulation enshrined in EU law around data protection and data privacy, covering citizens and users of services offered by businesses in EU and the EEA. The goal of the GDPR is to protect an individual's control over their own personal data, and to simplify the regulatory regime for businesses, especially those operating internationally.
Since the GDPR came into force, over €2.5 billion in fines have been imposed by national Data Protection Authorities ("DPAs") for data breaches, more than 700 one-stop-shop decisions have been taken by DPAs, and the EDPB has issued nearly 50 guidelines and recommendations. The volume of preliminary references from Member State national courts to the CJEU on issues not considered "acte clair" under the GDPR has also continued to increase with around 50 cases currently pending at the CJEU.
"Five years on from the GDPR we now have a wealth of guidance, decisions and case law that is really helping us to see the fundamental principles of the GDPR come to the fore. We're really seeing the supervisory authorities mature as regulators, and this in turn provides us as lawyers with key signals as to what their focus of attention is" Anne-Marie Bohan, Head of Technology and Innovation, Matheson LLP.
From a legal perspective, the implementation of GDPR has been an overall success despite significant challenges. Irish businesses in all industries, not to mention sports clubs, charities and other organisations who are "data controllers" or "data processors" under the GDPR have shown themselves to be capable of building coherent strategies for dealing with what were at the time very new and complex regulations.
The last five years have been about getting up to speed, processes and procedures getting bedded in and understanding a brand new area of regulation. Looking forward, equipped with the benefit of five years of decisions and guidance, businesses are now taking a fresh look at the policies and procedures they put in place when the GDPR came into force in 2018 to see what needs to be updated, as demonstrable compliance with the GDPR must be evidenced through "living documents". It is timely therefore that the Irish Data Protection Commission recently launched guidance for businesses looking to review their Record of Processing Activities ("ROPAs"), based on a review of ROPAs from 30 representative organisations.
As the legislation matures, the trend is now moving increasingly into enforcement and litigation. On the matter of enforcement, we recently saw the largest fine ever imposed by the Irish Data Protection Commission, in relation to Meta Ireland's data transfers to Meta US.
We are also seeing the progression of the GDPR in the context of civil litigation. Following the conclusion of UI v Österreichische Post AG (Case C-300/21) ("the Austrian Post case"), there is more clarity around how claims for compensation for non-material losses can be brought. A number of further test cases are expected to be heard before the Court of Justice of the European Union ("CJEU") and following these decisions we expect to see a rise in claims for non-material damage following data breaches and other infringements of the GDPR.
The first five years of the GDPR have been eventful and if there is one thing that is for certain, the next five years will not be any different.
KEY THEMES IN DATA PROTECTION
ACTS AWAITING COMMENCEMENT
Communications (Retention of Data) (Amendment) Act 2022
Date signed into law: 21 July 2022
The Communications (Retention of Data) (Amendment) Act 2022 (the "Amendment Act") amends the Communications (Retention of Data) Act 2011. It is intended to address the impact of recent EU case law relating to the Graham Dwyer murder conviction. The CJEU delivered a judgment in the Dwyer case in April 2022, confirming that Irish law is inconsistent with EU law, insofar it allows the general and indiscriminate retention of traffic and location data for the purposes of 'combating serious crime'. The Amendment Act provides that the general and indiscriminate retention of traffic and location data is only permitted on 'national security grounds', where approved by a designated judge following an application by the Minister of Justice. The Amendment Act is only intended to be a temporary fix to allow more time for overhaul of the 2011 Act. The government has announced that it will bring forward a set of wider reforms to clarify and consolidate the law on data retention. Heads of a new bill entitled the "Communications (Data, Retention and Disclosure) Bill" are in preparation.
Latest stage: Following recent scrutiny from the European Commission, the Communications (Retention of Data) (Amendment) Act 2022 will now take effect from 26 June 2023.
Consumer Rights Act 2022
Date signed into law: 7 November 2022
This act consolidates and updates existing consumer protection laws that regulate consumer contracts, as well as introducing new and enhanced consumer protection measures, particularly in the area of digital goods and services. The act gives effect to a number of EU consumer rights directives, including, inter alia, the following:
- Directive 2019/770 on certain aspects concerning contracts for the supply of digital content and digital services (The Digital Contents Directive)
- Directive 2019/771 on certain aspects concerning contracts for the sale of goods (The Revised Sale of Goods Directive); and
- The main provisions of Directive 2019/2161 on the better enforcement and modernisation of EU consumer protection rules (The Omnibus Directive). This Directive itself amends the Unfair Contract Terms Directive 93/13/EEC; the Unfair Commercial Practices Directive 2005/29/EC; the Consumer Rights Directive 2011/83/EU, and the Price Indication Directive 98/6/EC.
Latest stage: The whole act, other than s.161, has been commenced.
Online Safety and Media Regulation Act 2022
Date signed into law: 10 December 2022
This act provides for the establishment of a Media Commission, Coimisiún na Meán, and the dissolution of the Broadcasting Authority of Ireland. The legislation introduces a regulatory framework for online safety to tackle the spread and amplification of harmful online content, as well as updates to the regulation of audiovisual media services and the implementation of the revised Audiovisual Media Services Directive.
Latest stage: The act was partially commenced on 15 March 2023 by SI 71/2023 but a number of sections await commencement.
Communications Regulation and Digital Hub Development Agency (Amendment) Act 2023
Date signed into law: 2 March 2023
This act transposes Directive 2018/1972 establishing the European Electronic Communications Code (Recast). The legislation will update the enforcement regime for the Commission for Communications Regulation, as well as introducing new consumer protection measures such as an enhanced alternative dispute resolution process, compensation schemes, and a "Customer Charter" amongst others. The legislation will also amend the Communications Regulation Act 2002.
Latest stage: Part 1 of the act commenced on enactment. Parts 10 and 11 commenced on 8 March 2023. The remainder of the act was commenced on 9 June by SI 299/2023.
IRISH PROPOSED LEGISLATION
Digital Services Bill
Introduced in this legislative programme, this proposed bill will implement Regulation (EU) 2022/2065, the Digital Services Act, and will designate Coimisiún na Meán as the Digital Services Coordinator for Ireland.
Latest stage: Pre-legislative scrutiny underway.
Communications (Data, Retention and Disclosure) Bill
This bill will consolidate and replace the current Communications (Retention of Data) Act 2011.
Latest stage: Heads of Bill in preparation.
Cyber Security Bill
This bill will establish the National Cyber Security Centre of Ireland ("NCSC") on a statutory basis and provide for related matters including clarity around its mandate and role.
Latest stage: Work is underway.
Criminal Justice (Protection, Preservation of and Access to Data on Information Systems) Bill 2023
This bill proposes to give effect to those provisions of the Council of Europe Convention on Cybercrime 2001 not already provided for in national law in order to enable ratification of the Convention.
Latest stage: Work is underway.
Interception of Postal Packets and Telecommunications Messages (Regulation) (Amendment) Bill
This bill proposes to amend various pieces of legislation in respect of electronic communications.
Latest stage: Heads of bill in preparation.
STATUTORY INSTRUMENTS
European Union (Electronic Communications Code) Regulations 2022 (S.I. 444/2022)
Alongside the Communications Regulation and Digital Hub Development Agency (Amendment) Act 2023, which was recently signed into law (see above), these regulations give effect to Directive (EU) 2018/1972 establishing the European Electronic Communications Code (the "EECC"). The EECC addresses developments in the electronic communications sector, particularly the emergence of Over the Top ("OTT") service providers, as well as updating a number of key areas to ensure that the EU's regulatory framework is suitable for the digital age. Under these regulations, the Commission for Communications Regulation is appointed as the national regulatory authority to oversee and enforce the rules.
Latest stage: The regulations commenced with the Communications Regulation and Digital Hub Development Agency (Amendment) Act 2023 on 9 June 2023 under
EU REGULATIONS
Digital Operational Resilience Act ("DORA")
Data published: 27 December 2022
DORA is designed to consolidate and upgrade Information and Communications Technology ("ICT") risk requirements throughout the financial sector to ensure that all participants of the financial system are subject to a common set of standards to mitigate ICT risks for their operations. DORA aims to ensure that all participants in the financial system have the necessary safeguards in place to mitigate cyber-attacks and other risks. It will also introduce an oversight framework for critical ICT third party providers, including cloud service providers.
Latest stage: Published in the EU Official Journal on 28 December 2022, and entered into force on 16 January 2023. It will apply from 17 January 2025.
Digital Services Act ("DSA")
Date published: 27 October 2022
This regulation is one of two legislative initiatives announced by the Commission as part of the European Digital Strategy, “Shaping Europe’s Digital Future”, announced in December 2020, which aims to upgrade the rules governing digital services in Europe. It is intended to update the eCommerce Directive and regulate the provision of digital services by: (i) online intermediaries; (ii) hosting services; (iii) online platforms; and (iv) very large online platforms (“VLOPs”) and very large online search engines ("VLOEs") ie, online platforms and search engines that reach 45 million or more average monthly users in Europe.
Latest stage: Entered into force on 16 November 2022. It will apply from 17 February 2024, except for certain provisions applicable to VLOPs and VLOEs. The DSA will apply to VLOPs and VLOEs from four months after their designation as same by the European Commission. The proposed Digital Services Bill will implement the act.
Data Governance Act
Date published: 3 June 2022
The purpose of this regulation is to establish a framework to facilitate general and sector-specific data-sharing (including data of public bodies, private companies and citizens). The regulation provides for:
- A reuse regime for certain categories of public sector data
- A framework for data intermediation services which aims to establish commercial relationships for the purposes of data sharing between data subjects, data holders and data users
- Contribution to data altruism and the creation of common safeguards to increase trust in recognised data altruism organisations
Latest stage: Published in the EU Official Journal on 3 June 2022, and entered into force on 23 June 2022. It shall apply from 24 September 2023.
Digital Markets Act ("DMA")
Date published: 15 December 2020
This regulation is part of the European Digital Strategy, “Shaping Europe’s Digital Future”, announced in December 2020 which aims to upgrade the rules governing digital services in Europe. This regulation will create harmonised rules defining and prohibiting certain unfair practices by “gatekeeper” platforms (providers of core platform services) and introduces a new competition tool to deal with structural competition problems across markets which cannot be tackled or addressed using existing competition rules. The measures include new powers for the Commission to conduct market investigations.
Latest stage: Published in the EU Official Journal on 12 October 2022, and entered into force on 1 November 2022. Most of the DMA provisions will apply as of 2 May 2023.
EU DIRECTIVES AWAITING IMPLEMENTATION
NIS2: Directive on Measures for a High Common Level of Cybersecurity across the Union
Date published: 27 December 2022
This proposed revision to the Network and Information Security Directive (Directive (EU) 2016/1148) will strengthen the security requirements, address the security of supply chains, streamline reporting obligations, and introduce stricter enforcement requirements, including harmonised sanctions across the EU to address the growing threats posed by digitalisation and the surge in cyber-attacks. Once adopted, it will replace Directive 2016/1148.
Transposition date: 18 October 2024
EU DRAFT LEGISLATION
ePrivacy Regulation
Procedure reference: 2017/0003 (COD)
Date published: 10 January 2017
This proposal forms part of the EU Digital Single Market Strategy. The proposed regulation has been amended on a number of occasions. An update to the 2002 Marketing ePrivacy Directive was seen as necessary to address new technological and market developments as well as the emergence of new techniques for tracking users’ online behaviour. The proposed ePrivacy Regulation will repeal the 2002 ePrivacy Directive and will complement the GDPR.
Latest stage: First reading in the Council.
AI Liability Directive
Procedure reference: 2022/0303/COD
Date published: 28 September 2022
The purpose of this directive is to address shortcomings in liability rules where artificial intelligence ("AI") systems are used, setting out standardised rules for access to information and easing the burden of proof in relation to AI claims.
Current liability rules, particularly fault-based rules, are not suitable for handling AI liability claims. Because of the complex nature of AI, specifically the so-called "black box" effect, it is difficult for victims to successfully prove the requirements for their claims. To help claimants overcome the challenges in establishing a causal link between fault, based on non-compliance with duty of care requirements, and output by AI systems, a 'presumption of causality' is introduced in the proposal. The presumption is rebuttable however and claimants are required to meet a number of conditions such as demonstrating that the output produced by the AI system gave rise to the damage in question. In cases where high-risk AI is involved, claimants will also have a right of access to information from companies.
Latest stage: First reading in the Council.
Artificial Intelligence Act
Procedure reference: 2021/0106 (COD)
Date published: 21 April 2021
In proposing a regulatory framework on AI, the Commission has identified the following specific objectives:
- to ensure that AI systems placed and used on the EU market are safe and respect existing law on fundamental rights and EU values;
- to ensure legal certainty to facilitate investment and innovation in AI;
- to enhance governance and effective enforcement of existing law on fundamental rights and safety requirements applicable to AI systems; and
- to facilitate the development of a single market for lawful, safe and trustworthy AI applications and prevent market fragmentation.
While acknowledging that AI is a fast-evolving and strategic technology with tremendous opportunities, the Commission believes that some uses of AI pose specific significant risks to the application of various EU rules designed to protect fundamental rights, ensure safety and attribute liability.
Latest stage: First reading in the Council.
Data Act
Procedure reference: 2022/0047/COD
Date published: 23 February 2022
This regulation aims to increase legal certainty for consumers and businesses to access data generated by the products or related services they own, rent or lease. It will maximise the value of data in the economy and establish fairness by putting in place rules on the use of data created by Internet of Things (“IOT”) devices and related services.
Latest stage: On 14 March 2023 the European Parliament adopted its position at first reading; the matter has been referred back to the committee responsible.
EU Cyber Resilience Act
Procedure reference: 2022/0272/COD
Date published: 15 September 2022
This regulation introduces cybersecurity requirements for products with digital elements. It aims to bolster cybersecurity rules to ensure more secure hardware and software products.
Latest stage: First reading in the Council.