Non-Discrimination Under the Most-Favoured-Nation Obligation and Adequacy Decisions in the General Data Protection Regulation
24 Pages Posted: 4 Oct 2023
Date Written: September 28, 2023
Regulatory measures on cross-border data flows are essential to personal data protection laws. The General Data Protection Regulation (hereinafter “GDPR”) of the European Union (hereinafter “EU”) is one of such influential personal data protection regimes, which has become a model and has been adopted by many countries. The GDPR aims to ensure the protection of natural persons regarding the processing of personal data. To protect personal data outside the EU, the GDPR provides certain safeguards for its movement across the EU border. Under the GDPR, the Commission can make a finding that a third country ensures an adequate level of protection, and the transfer of personal information to that country does not require specific authorization. Given the huge number of transfers involved, the adequacy decision is critical to the cross-border transfer of personal data under the GDPR. The adequacy status of a country would have a strong impact on the competitive position of its service providers supplying digital services to consumers in the EU. The adequacy decision is therefore at the heart of the EU’s Most-Favoured-Nation (hereinafter “MFN”) obligations under the international trade rules. This paper argues that the current likeness analysis of the MFN obligations under the General Agreement on Trade in Services (hereinafter “GATS”) is not optimal in solving the MFN disputes. Recent Regional Trade Agreements (hereinafter “RTAs”) adopted a different approach that may solve some of the major problems under the GATS, i.e., the costs and uncertainties associated with the issues regarding whether non-discrimination obligations and necessity tests even apply to data protection measures. Under such
RTAs, evaluations of data personal measures go straight to the non-discrimination test. It is more straightforward and cost-effective, and future trade negotiations should consider this approach.
Instead of focusing on the relationships between the services or service suppliers, this approach focuses on the non-discrimination obligation of the data protection regimes. However, the approach
raises the issue of determining the inconsistency with the MFN obligation. Considering the jurisprudence of the World Trade Organization (WTO), this paper argues that the Joint Statement
Initiative (JSI) negotiations should adopt an MFN obligation that focuses on the design, structure, and process of the personal data protection regime.
Keywords: non-discrimination, MFN, adequacy decision, GDPR, JSI
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