Is the data agreement between EU & US ready yet?

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Published on Oct 7, 2022 and edited on Jan 16, 2024 by Iron Brands

Data transfers between the EU and the US are one of the most widely discussed issues in data protection law right now. Countless business and governmental agencies across Europe are somehow reliant on a US-based processor for their operations. Yet, these data transfers pose privacy risks that are hard, if not impossible, to mitigate.

We've already touched upon data transfers in a blog that sums up the long story behind the DPA decisions against Google Analytics. However, this time we're going to look at data transfers from a more general viewpoint and try to explain the legal issues at stake in more detail.

  1. How do data transfers work under the GDPR?
    1. Adequacy decisions
    2. Standard contractual clauses
    3. What about the other mechanisms?
  2. US data transfers. A long story short
    1. Schrems I
    2. Schrems II
    3. The 101 complaints
  3. Supplementary measures for data transfers
    1. Encryption
    2. Proxy servers
    3. Pseudonymization
  4. The risk-based approach
  5. Now what?
  6. Updates
  7. Conclusions
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How do data transfers work under the GDPR?

The GDPR contains all sorts of rules to protect the data rights of individuals. But what happens when your data is transferred to a third country outside the EEA?

The GDPR contains a Chapter about data transfers specifically, consisting of seven Articles (44-50). These rules aim to ensure that personal data enjoys the same level of protection when transferred1.

In practical terms, a data transfer to a third country is only lawful when it relies on one of several mechanisms listed by the GDPR. To keep this short, we will focus on the ones that matter the most in practice: adequacy decisions and standard contractual clauses.

Adequacy decisions

The European Commission sometimes greenlight data transfers to a specific country. These decisions are called adequacy decisions and essentially acknowledge that the data are safe in that country.

These decisions are not purely political. This means that the Commission is not free to declare a country adequate just because they like it or because they are a long-time political ally. Instead, the Commission must make sure that personal data are actually safe in that country, according to certain criteria listed in the GDPR. Conversely, the Court of Justice can invalidate an adequacy decision that does not satisfy the GDPR criteria- as it did in the much discussed Schrems I and II rulings.

If you have an adequacy decision for the transfer you need, you are lucky. Adequacy decisions are an easy, hassle-free way to transfer data. However, they only cover a small number of countries: for all the others you will need a different mechanism

Standard contractual clauses

When you can't rely on an adequacy decision, you will need another mechanism for data transfers. Article 46 lists six of them, but in practice, you will probably use standard contractual clauses (SCCs).

SCCs are a set of standard clauses drafted by the European Commission. When someone transfers data to a third country, they include these clauses in a legally binding agreement with the recipient, and the clauses tell the recipient what they can and cannot do with the data. So, SCCs make a transfer safe by implementing data protection rules into a contract between the parties.

The main shortcoming of SCCs is that they do not bind the recipient State and, therefore, provide little or no protection against State surveillance.

This does not mean that SCCs cannot be used when dealing with "unsafe" countries. In that case, "supplementary measures" will be needed, as in the case of U.S. data transfers.

In other words, the controller needs to ensure that SCCs grant sufficient protection in practice, and if they don't, they must take extra steps to keep the data confidential. As we will see, this is very difficult when dealing with State surveillance.

What about the other mechanisms?

As we said, the GDPR provides transfer instruments other than SCCs and adequacy decisions, but they are not frequently used in practice.

Binding Corporate Rules (BCRs) are used to transfer data within branches of a single corporation. However, BCRs cannot be used when the European branch is an independent corporation controlled through capital ownership, which is a very frequent scenario. Additionally, BCRs need to be approved by national data protection authorities, which requires a long and complex legal procedure.

Certifications and codes of conduct for data transfers may gain traction in the future, but these systems are not really in place yet (although codes do sometimes play a role alongside SCCs, as in the old Privacy Shield agreement with the US).

Finally, the GDPR mentions legally binding instruments between public bodies. Of course, this mechanism is not available to companies and other private actors.

Crucially, all these instruments suffer from** the same issues as SCCs** when dealing with “unsafe” States: they do not bind the recipient State and do little or nothing against State surveillance (with the sole exception of instruments between public bodies, which are not available to companies anyway).

Data transfers under the GDPR

US data transfers. A long story short

To understand where we are now concerning US data transfers, we need to take a quick look at a decade-long story of legal battles.

Schrems I

From 2000 to 2015, data transfers between the EU and the U.S. were covered by a data transfer agreement called Safe Harbor.

In 2013 American whistleblower Edward Snowden leaked confidential documents about the operations of the CIA and NSA. The revelations contained records on bulk data collection operations that targeted foreign nationals on a large scale and were based on Section 702 of the FISA act and Executive Order 12333.

Shortly after the Snowden revelations, Austrian citizen Max Schrems filed a complaint against Facebook Ireland before the Irish supervisory authority (DPC). He claimed that the transfer of his personal data to Facebook Inc. was unsafe and illegal because of the extent and pervasiveness of State surveillance in the US, as documented in the Snowden files.

In 2015 the case landed in the EU Court of Justice, which ruled in Schrem's favor and invalidated the Safe Harbor regime.

Schrems II

Schrems' case continued, and was referred to the CJEU a second time. In 2020 the Court ruled in favor of Schrems again. It invalidated the Privacy Shield, another framework for data transfers that replaced the Safe Harbor regime in between the two Schrems rulings.

The validity of SCCs as a transfer mechanism was also questioned in the case. The Court did not invalidate SCCs in the ruling. Still, it stated that supplementary measures were needed to protect data from surveillance practices in "unsafe" countries such as the U.S. In other words, the Court "spared" SCCs but also made them more complicated and burdensome to use.

Overall, the Schrems II ruling made data transfers to the U.S. much more complicated. Companies can no longer rely on an adequacy decision after the Privacy Shield was invalidated and need to use other instruments (typically SCCs) instead. They also need to implement adequate supplementary measures to counter the risk of State surveillance.

The 101 complaints

Despite widespread panic about data transfers, most companies kept doing business as usual and transferring data to the US as if Schrems II didn't happen.

But right after the Schrems II ruling, noyb (a privacy NGO founded by Schrems) filed 101 complaints centered on data transfers. The complaints were filed before the DPAs of several Member States and target websites using U.S.-based services Google Analytics and Facebook Connect. These complaints are a strategic effort to get European DPAs to apply the Schrems II ruling rigorously.

The EDPB (short for European Data Protection Board, a European institution gathering all European DPAs) later created a task force for coordinating the approach of European DPAs to noyb's complaints. By the looks of it, the task force did a good job: three DPAs upheld the complaints against Google Analytics so far, and the Dutch DPA stated that they might follow along. In a recent press release, the Danish DPA also embraced the same approach and declared the use of Google Analytics unlawful.

But the issue is bigger than GA. The reasoning that led to Google Analytics being banned from some Member States may someday lead to the ban of many other services, including cloud services which are practically indispensable for the European economy at the moment.

Supplementary measures for data transfers

And now the one billion dollar question: what supplementary measures are effective against U.S. surveillance?

The EDPD suggested some solutions in their guidelines on supplementary measures, but they are few, and all have significant limitations. It should be noted that these are only general suggestions: there is no clear-cut answer to the question, as safeguards need to be chosen and evaluated case by case.


A fundamental distinction needs to be made between end-to-end encryption and other forms of encryption.

End-to-end encryption can be an effective safeguard7. However, it also limits what can be done with the data. Some processing operations are more difficult on encrypted data, and others simply require access to some data in the clear. For example, the provider of an end-to-end encrypted email service needs to process the address of the sender and recipient in the clear to deliver the mail. This information is still personal data under the GDPR.

On the other hand, non-end-to-end encryption is never an effective safeguard. If the service provider holds a decryption key8, it can be required to hand it over under FISA along with the encrypted data. In other words, your data is in a safe, but the companies can be forced to hand over the key. This is why the Austrian, French and Italian DPAs all dismissed Google Analytics' data encryption as irrelevant when dealing with noyb's complaints.

To be perfectly clear, non-end-to-end encryption is still a useful cyber security measure, as it effectively protects against attacks. It just doesn't help against surveillance legislation.

Proxy servers

The French DPA has proposed proxy servers as an effective safeguard for using Google Analytics. They are, but they cannot be used for all data transfers. They are also burdensome and expensive to implement, as the French DPA itself acknowledges.

The idea is simple in theory: instead of sending the data directly to Google, you run it through a proxy server and filter out or anonymize all personal data before sending it to Google.

Here's the catch: you must host and run Google Analytics on your own server. This means you must maintain the server and manually keep the software up to date, on top of writing code to anonymize any personal data. This is way more complicated and expensive than paying for a GDPR-compliant alternative.

Additionally, this solution requires complete control of the infrastructure. This is not an attractive option for using cloud services since the main advantage of clouds is that you don't need any physical infrastructure, to begin with.


The EDPB also suggests pseudonymization9. In a nutshell, pseudonymization means that you can only transfer data that cannot be used to re-identify the data subject, even in combination with other data.

Pseudonymization is not anonymization under the GDPR, but it can definitely be a useful privacy measure. It can also be hard to implement correctly. Replacing identifiers with pseudonyms is not enough, as you may need to process and transfer a lot of other potentially identifying data. In some cases, proper pseudonymization of all the data you transfer will be impossible or make the processing practically useless.

The controller also needs to consider data linkage- that is, the possibility that someone may re-identify the data subject by combining the exported data with any other information they may possess. Evaluating the risk of re-identification is difficult when dealing with State surveillance because intelligence agencies gather a lot of information about a lot of people and are not transparent about the information they possess- that's their job after all.

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The risk-based approach

Some companies adopt a risk-based approach to data transfers. They essentially claim that a transfer is safe and lawful when there is a low enough probability that the transferred data will be subject to surveillance.

However, Chapter V of the GDPR never refers to the notion of risk10, and the Schrems II decision never considers the likelihood of data being subject to surveillance. This is why the EDPB, the EDPS11, and the Austrian and Italian DPAs12 have explicitly rejected the risk-based approach.

To be clear: when transferring data, an exporter should assess whether the specific data they are exporting are subject to any "problematic" surveillance legislation in the first place. This question is necessary for evaluating data transfers and should not be confused with the risk-based approach that DPAs are currently rejecting.

But the answer to this question will be "yes" for most (if not all) US data transfers because the scope of FISA appears to be quite broad in practice- as shown by the Snowden files.

Now what?

As we have seen, data transfers are quite the legal puzzle right now. Effective safeguards are very few and are not available at all for some transfers. At the same time, authorities are moving towards a stricter approach to data transfers.

Of course, this is bigger than Google Analytics alone. A strict stance on data transfer might make it unlawful to use many U.S.-based service providers, including cloud-based services, which are practically irreplaceable right now.

This is why data transfers are a very delicate issue. On the one hand, the privacy safeguards of the GDPR should not be undermined by data transfers. On the other hand, it's unreasonable to shift the burden of compliance on companies entirely. Forcing businesses to ditch GA in favor of other analytics tools is one thing. Expecting them to make do without Oracle or AWS is something else entirely.

This is why a political solution needs to be found at some point. The European Commission and the US Government are currently working on another data transfer agreement, and an executive order on data transfers from President Biden is expected shortly. However, the US has not changed its surveillance legislation since the Schrems II ruling, and without such changes, a new data transfer framework may not survive a Schrems III ruling.


_The new data transfer framework is now a reality. US President Joe Biden published an executive order on surveillance activities in October 2022 and the European Commission adopted an adequacy decision in July 2023 (against the negative opinion of the EU Parliament).

_The long saga of data transfers is not quite over yet. Noyb intend to challenge the decision before the EU Court of Justice, so we are looking at an upcoming Schrems III ruling. Without substantial legislative changes to US surveillance law, and with the EU Parliament pushing against the framework, the Court is likely to invalidate the adequacy decision and bring us all back to square one


Even if the issues regarding data transfers will continue in the foreseeable future, businesses can protect themselves by using EU alternatives to US cloud services.

The GDPR is here to protect the data of EU citizens. Adhering to the law should be a priority for every business. In addition, we feel companies should go further than just sticking to the law.

The internet will be a better place if organizations navigate their business without relying on privacy-invasive tooling like Google Analytics. It is the right thing to do from an ethical standpoint. This is why we built Simple Analytics, a privacy-first Google Analytics alternative that is cookieless by design and does not collect any personal data while providing the insights you need.

We believe in creating an independent web that is friendly to website visitors. If this resonates with you, feel free to give us a try.

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