Europe’s digital industry opposes the Data Act

On May 8, 2023, the DigitalEurope organization, which brings together the main digital industry players active in Europe, posted a letter to the European Commission criticizing the Data Act. This draft European regulation, presented in February 2023, plans to facilitate the sharing of industrial data generated in the European Union, in compliance with the RGPD.

The Data Act is designed in particular to create new use cases, and thus increase the value of this data for European businesses, especially SMEs. The Commission forecasts an additional €270 billion in GDP by 2028.

One of the aims of the Act is to redress the balance of power between the large companies that generate data and the smaller organizations that often struggle to obtain it. The Data Act also includes a requirement to share data with public authorities, free of charge in the event of a major crisis, with compensation in other cases.

In its letter to the Commission, DigitalEurope calls for « a pause » in the text’s legislative path. « Such a monumental change to established ways of operating, without proper preparation, represents a huge risk both to cybersecurity and to the competitiveness of some of Europe’s most successful companies, » states the organization.

DigitalEurope shares three major concerns. Firstly, it believes that « data sharing between companies does not yet provide sufficient guarantees on cybersecurity or the protection of trade secrets and health data« . DigitalEurope sees this as « a huge risk to the continent’s competitiveness and resilience in the face of hybrid threats ».

The organization also considers the Data Act « far too open » on data sharing with governments, « which may lead to abuse and data breaches ». The mechanism also risks disadvantaging « small and medium-sized enterprises that want to focus on innovation ». DigitalEurope therefore advocates limiting data sharing with governments to a few clearly defined emergency situations.

Finally, the organization believes that the cloud component of the Data Act « runs against freedom of contract, preventing customers from getting the best possible deal« .

« Up to 90% of European companies’ data is unstructured and not yet protected by intellectual property; it represents their future competitiveness, and forcing them to share it is not a wise choice for Europe. (…) Imposing such an ambitious and hasty regulation would be shooting ourselves in the foot, » argues Cecilia Bonefeld-Dahl, Managing Director of DigitalEurope.