News
28.04.2023
A Building Block of the European Data Strategy: The Data Act
On February, 23rd 2022, the European Commission (“the Commission”) has published a new and long awaited proposal for the Data Act (“the Act”). It is evaluated by the Commission that the Act will “ensure fairness in the digital environment, stimulate a competitive data market, open opportunities for data-driven innovation and make data more accessible for all.”
Therefore, The Act is considered to be one of the pioneers of the European Data Strategy and aims to provide fair access to data and to regulate the procedures and principles regarding the use of data. The Data Act is the second main regulation after the recently adopted Data Governance Act (“the DGA”) which were both foreseen on the February 2020 European strategy for data and it complements the DGA.
Although it is prepared in accordance and consistent with the General Data Protection Regulation (“GDPR”), the Act provides a broad definition of data, covering all kinds of digital outlooks of both personal and non-personal data, unlike GDPR. The Data Act applies to;
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Manufacturers of products and suppliers of related services placed on the market in the EU and the users of such products or services,
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Data holders that make data available to data recipients in the EU,
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Data recipients in the EU to whom data are made available,
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Public sector bodies and EU institutions, agencies or bodies that request data holders to make data available where there is an exceptional need to that data for the performance of a task carried out in the public interest and the data holders that provide those data in response to such request,
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Providers of data processing services offering such services to customers in the EU.
There are certain obligations envisaged to data owners, such as making available to the user the data generated by its use of a product or related service where data cannot be directly accessed by the user from the product and without undue delay, free of charge and if possible, continuously and in real-time. Within the scope of the Data Act, regulations regarding the protection of trade secret and intellectual property rights in data transfers are also included in the proposal.
The Data Act gives public bodies a limited and exceptional right to access data held by the private sector. This right can be used where the access is necessary to prevent, respond to or recover from a public emergency such as terrorist attacks, public health emergencies, natural disasters, or where the lack of data prevents the public body from fulfilling a duty in the public interest provided by law.
The small and medium enterprises (“SMEs”) will have a protective shield against unfair contractual terms, which gives them a higher chance on negotiating. According to the Commission, clauses that do not pass the “unfairness test” will not be binding on SMEs. There will be standard and non-binding contractual terms developed and recommended by the Commission that will provide a fairer negotiation process for SMEs.
As the European Commission mentioned, the legislative initiatives including the Data Act will create a single market to allow data to flow freely within the EU and across sectors for the benefit of businesses, researchers, public administrations and society at large and the Data Act is deemed to be one of the main initiatives. It is believed that the new regulation will result in stimulation of data economy.