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Microsoft warns that the PATRIOT Act, recent renewed by President Obama, will allow the U.S. to invade EU citizens' private data without notification.  (Source: Paramount Pictures)

The revelation could lead the EU to forcing Facebook, Google, Microsoft, and others to adopt isolated hosting in Europe for European services. Currently much of the hosting for European users is handled in America, exposing their data to invasive U.S. laws.  (Source: Flickr/TJCrowley)

Senators John McCain (R-Ariz.) and John Kerry (D-Mass.) have proposed a privacy bill that may help fix the awkward standoff.  (Source: AP Photo)
Microsoft tipped off the EU about possible data grab

The European Union (EU) is a little bit upset with the United States federal government after it caught wind of a possible plan to swipe EU citizens' private data from cloud service providers, in violation of EU laws.  And the U.S. government can blame software giant Microsoft Corp. (MSFT) for letting the secret out of the bag.

I. PATRIOT Act: Policing the World

People often get caught up in possible domestic spying issues of the "Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001" (USA PATRIOT Act of 2001) as it authorizes the gathering of "foreign intelligence information" from U.S. citizens.

But the bill, which was renewed for four years by President Barack Obama in 2011, is primarily aimed at gathering intelligence from foreign nations.  In that regard, much of its authorizations deal with "spying" on foreign nations -- not solely U.S. citizens.

With citizens in the U.S. and Europe increasingly using "the cloud" -- services from companies like Microsoft, Facebook, Google Inc. (GOOG), and Apple, Inc. (AAPL) -- the question becomes how secure these resources are.

While the U.S. does not guarantee the privacy of its citizens online, the EU has a law titled the Data Protection Directive, which mandates that the EU protect the privacy of its citizens.  The Directive demands that citizens be informed any time private data is obtained.  The problem is that mandate does little to stop the U.S. from secretly seizing cloud data in the name of the PATRIOT Act according to warnings from Microsoft and top lawyers.

II. Our Laws Are Greater Than Yours

Microsoft warns that under the PATRIOT Act, it might not only be forced to hand over EU citizens' data; it might also be forced to do so secretly, without informing the EU.  This would directly violate the privacy protections the EU promises to enforce.

The company writes, "In a limited number of circumstances, Microsoft may need to disclose data without your prior consent, including as needed to satisfy legal requirements, or to protect the rights or property of Microsoft."

Sophia In't Veld (Netherlands) an EU parliamentarian, voiced outrage at the prospect, stating, "Does the Commission consider that the U.S. PATRIOT Act thus effectively overrules the E.U. Directive on Data Protection? What will the Commission do to remedy this situation, and ensure that E.U. data protection rules can be effectively enforced and that third country legislation does not take precedence over E.U. legislation?"

"I hope Commissioner Reding will respond soon, as this is really a key issue. Essentially what is at stake is whether Europe can enforce its own laws in its own territory, or if the laws of a third country prevail. I hope the Commissioner will ensure that the U.S. and other countries respect E.U. laws in E.U. territory. I don't think the U.S. would be amused if Europeans (or other non-U.S. authorities) were to get access to databases located within U.S. jurisdiction."

The EU and the U.S. already have an agreement called Safe Harbor, which allows for the sharing of data under certain restrictions such as the promise of reasonable data security, and clearly defined and effective enforcement.  In these cases the EU is informed of the request, so it can inform the affected citizens about it.

The problem is that the PATRIOT Act offers a far easier secret backdoor to the same information.  And there's little the EU can do to stop it.

Theo Bosboom, IT lawyer with Dirkzager Lawyers comments, "I'm afraid that Safe Harbor has very little value anymore, since it came out that it might be possible that U.S. companies that offer to keep data in a European cloud are still obliged to allow the U.S. government access to these data on basis of the PATRIOT Act. Europeans would be better to keep their data in Europe. If a European contract partner for a European cloud solution, offers the guarantee that data stays within the European Union, that is without a doubt the best choice, legally."

That could spell big trouble for companies like Google, Facebook, Microsoft, and Apple should the EU decide to apply restrictions or mandates to their services in order to protect its citizens' privacy from foreign powers.  Such restrictions could for the companies to switch to local, isolated serving to prevent the U.S. from having access to the data.  However, such schemes would be pricey to implement.

III. Does U.S. Privacy Bill Provide an Answer?

One potential solution may lie with the pending online privacy protection legislation proposed by Senators John Kerry (D-Mass.) and John McCain (R-Ariz.).  

The bill has received much resistance from the online data mining and advertising community, as it suggests the creation of a mandatory opt-out of data gathering.  Such an opt-out could be cost-prohibitive for smaller sites and could seriously undermine online advertising's profitability.

The bill could also make it harder to use the PATRIOT Act to grab information without public notification.

States EU Data Protection Commissioner Viviane Reding, "I welcome a draft Bill of Rights just introduced in the U.S. Congress as a bipartisan initiative of Democrats and Republicans. The Commission also shares the main objective of the Bill: strengthening individuals' trust in new technologies through compatible standards."

A compromise may be reached, but it's doubtful this will be the last we hear of this controversy.

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RE: What could happen.
By monitorjbl on 7/6/2011 4:08:14 PM , Rating: 2
Personal freedoms extend only as far as the greater public allow them to. If the majority of the public (as represented by our elected leaders) choose to say that overuse of gas by people exerting such a freedom is negatively affecting them, it's completely within the confines of the Constitution to pass a law restricting that freedom. And the overconsumption of gas by some absolutely does affect others, it drives the price of gas up in accordance with the laws of supply and demand.

You can't do anything you want just because you want to, that's not how 'freedoms' work. You are given freedoms by the public as a whole, as represented by elected leaders, not by your personal mandate. You can complain all you want about how little the leaders care about people like you and how broken the system is (and I would agree in a lot of cases), but even in principle your argument is flawed. The same thing would have happened if we had a true democracy; none of your 'freedoms' are inalienable if the country doesn't want them to be.

RE: What could happen.
By Reclaimer77 on 7/6/2011 4:27:58 PM , Rating: 2
it's completely within the confines of the Constitution

Please, no it is NOT. Regulating "overuse" of something is most certainly not a granted Federal power by the Constitution. In fact "overuse" is a completely subjective statement. What is overuse in your opinion might be normal or even necessary to someone else. Why do you assume that you're right?

You are given freedoms by the public as a whole, as represented by elected leaders, not by your personal mandate.

And here is where the fail train runs off the tracks. This sentence absolutely proves that you do NOT understand the Constitution or the men who wrote it. Our rights and freedoms do NOT extend from the Executive branch or our elected leaders. The Founders believed that we have "inalienable" rights, that they are "self-evident" and Universal. And the Governments job was to PROTECT, not grant, those freedoms and rights. We are not "given" freedoms!

In other words, the day to day activities of citizens were never meant to fall under the mandate of the Federal Government or it's regulations. It's patently absurd you think what gasoline one uses or how much of it falls under the Constitution. Without using the horribly misquoted and raped "Commerce Clause", can you back your claim up?

RE: What could happen.
By Reclaimer77 on 7/6/2011 4:37:28 PM , Rating: 2
If you care to read this, you'll see why it's not Constitutional to regulate what fuel we can consume or how much.

Relevant quote:

Another example would be how Congress currently encourages the use of American made ethanol for gasoline blending by placing a $0.60 per gallon duty on all imported ethanol. While this is a proper exercise of regulating commerce, mandating by positive law that refineries must produce gasoline blended with ethanol is not because such laws are a police regulation that only the sovereign where such activities occur under can mandate.

RE: What could happen.
By monitorjbl on 7/7/2011 9:51:12 AM , Rating: 2
First, here is where you fail to understand the basics of any government: the people are the true power. If the Constitution promises to defend rights that are inconvenient, they can be revoked if enough people decide that its necessary (and they have been in the past). The rights that the founders decreed to be 'inalienable' are given to you by everyone around you, not by the universe. Further, they're not protected by the Constitution, they're protected by the government, which is an extension of the people. And just as 'overuse' is subjective, so are those inalienable rights.

Second, even if we do accept the wording of the Constitution to be absolute and the source of all law and order, the price of gasoline absolutely affects interstate trade. If you think the commerce clause is overused, you're probably right, but that doesn't mean it isn't valid here. Trucks and trains move just about everything between states and they run on gas, if you can believe that. You can't discount the clause that ruins your argument just because you don't like it.

RE: What could happen.
By Bad-Karma on 7/11/2011 3:41:13 AM , Rating: 2
Man are you off in left field.....

First off, the US Constitution lays out the framework, structure and running of the federal government. It doesn't talk about "Rights".

Further, they're not protected by the Constitution, they're protected by the government, which is an extension of the people. And just as 'overuse' is subjective, so are those inalienable rights.

Wrong again. It's the bill of rights that guarantees our freedoms. And since you don't seem to know anything about it, it starts off like this:
THE Conventions of a number of the States having at the time of their adopting the Constitution, expressed a desire, in order to prevent misconstruction or abuse of its powers, that further declaratory and restrictive clauses should be added : And as extending the ground of public confidence in the Government, will best insure the beneficent ends of its institution

The Bill of rights was put into place to protect the people from the government.

The rights that the founders decreed to be 'inalienable' are given to you by everyone around you, not by the universe. Further, they're not protected by the Constitution, they're protected by the government,


adjective /in'ale?n?b?l/

Unable to be taken away from or given away by the possessor

Now, part of the Declaration of Independence:
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

The Federal Government was purposely designed so that should it abuse its powers and or take away the rights of its citizens, then it is to be "altered or abolished" and rebuilt.

Next time, before you go running you mouth about something you obviously have no knowledge of, just ask a veteran. We swore and oath to defend and protect the US Constitution, and most of us understand it very well.

"We don't know how to make a $500 computer that's not a piece of junk." -- Apple CEO Steve Jobs

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