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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 michael67 on 7/7/2011 5:54:34 AM , Rating: 1
quote:
Considering the EU's developing penchant to raise money by suing international corporations.

Right, MS did not got fines because they ware saying fuck you EU we do things our own way and don't give a shit about what you say ^_^

No they got it because they followed the EU law time and time again, and because they ware thinking, hey we sell this software over in the EU, lets be a good company, because we never did anything before to warren's anyone to be suspicious of us and we like to keep it that way ^_^

Its funny how we can robe money from US companies that do noting wrong, those US pussy's just pay up, because US government would not defend them anyway if we just take there money whit out due proses and we give shit about common int law.

And this had noting to with why the fine was that high
quote:
"Microsoft was the first company in 50 years of EU competition policy that the commission has had to fine for failure to comply with an antitrust decision," Kroes said in a statement. "I hope that today's decision closes a dark chapter in Microsoft's record of noncompliance with the commission's March 2004 decision."

https://www.nytimes.com/2008/02/27/technology/27ih...

Get a brain, MS gambled that the EU would back down, then the EU just said FU and said, "If you don't follow the rules we are going to fine you 3m Euro a day till you do".

And that, not like in the US, ware only criminals get a 3 strike penalty, we have them for corporations to.


RE: What could happen.
By zeve on 7/8/2011 12:40:50 PM , Rating: 2
The fact that you americans are blind to see that MS uses uncompetitive ways to promote it's software it's not our fault. We saw it and burned them. You see, it's not a jungle out there, that's why we have laws.

As for this PATRIOT act, I think US should resume to verifying data only on it's own territory. If the datacenters of US companies are located in EU for instance, they have to obey local laws.

Oh yes...and if US is so F***ng mighty...why did the galaxy S2 not launched yet in the states?

I wonder what US would do if all world would shut it down. You know...US invented the cellphone...but not one single phone was manufactured in US. So here's the catch...be a good boy and mind your business US.


"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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