The Era of Borderless Data Is Ending
David McCabe, Adam Satariano
10-13 minutes
Nations are accelerating efforts to control data produced within their
perimeters, disrupting the flow of what has become a kind of digital
currency.
David McCabe, who reports from Washington, and Adam Satariano, who
reports from London, cover how tech laws and regulation are changing
globally.
May 23, 2022Updated 2:26 p.m. ET
Every time we send an email, tap an Instagram ad or swipe our credit
cards, we create a piece of digital data.
The information pings around the world at the speed of a click, becoming
a kind of borderless currency that underpins the digital economy.
Largely unregulated, the flow of bits and bytes helped fuel the rise of
transnational megacompanies like Google and Amazon and reshaped global
communications, commerce, entertainment and media.
Now the era of open borders for data is ending.
France, Austria, South Africa and more than 50 other countries are
accelerating efforts to control the digital information produced by
their citizens, government agencies and corporations. Driven by security
and privacy concerns, as well as economic interests and authoritarian
and nationalistic urges, governments are increasingly setting rules and
standards about how data can and cannot move around the globe. The goal
is to gain “digital sovereignty.”
Consider that:
In Washington, the Biden administration is circulating an early
draft of an executive order meant to stop rivals like China from gaining
access to American data.
In the European Union, judges and policymakers are pushing efforts
to guard information generated within the 27-nation bloc, including
tougher online privacy requirements and rules for artificial
intelligence.
In India, lawmakers are moving to pass a law that would limit what
data could leave the nation of almost 1.4 billion people.
The number of laws, regulations and government policies that
require digital information to be stored in a specific country more than
doubled to 144 from 2017 to 2021, according to the Information
Technology and Innovation Foundation.
While countries like China have long cordoned off their digital
ecosystems, the imposition of more national rules on information flows
is a fundamental shift in the democratic world and alters how the
internet has operated since it became widely commercialized in the
1990s.
The repercussions for business operations, privacy and how law
enforcement and intelligence agencies investigate crimes and run
surveillance programs are far-reaching. Microsoft, Amazon and Google are
offering new services to let companies store records and information
within a certain territory. And the movement of data has become part of
geopolitical negotiations, including a new pact for sharing information
across the Atlantic that was agreed to in principle in March.
“The amount of data has become so big over the last decade that it has
created pressure to bring it under sovereign control,” said Federico
Fabbrini, a professor of European law at Dublin City University who
edited a book on the topic and argues that data is inherently harder to
regulate than physical goods.
For most people, the new restrictions are unlikely to shut down popular
websites. But users might lose access to some services or features
depending on where they live. Meta, Facebook’s parent company,
recently said it would temporarily stop offering augmented reality
filters in Texas and Illinois to avoid being sued under laws governing
the use of biometric data.
The debate over restricting data echoes broader fractures in the global
economy. Countries are rethinking their reliance on foreign assembly
lines after supply chains sputtered in the pandemic, delaying deliveries
of everything from refrigerators to F-150s. Worried that Asian computer
chip producers might be vulnerable to Beijing’s influence, American
and European lawmakers are pushing to build more domestic factories for
the semiconductors that power thousands of products.
Shifting attitudes toward digital information are “connected to a
wider trend toward economic nationalism,” said Eduardo Ustaran, a
partner at Hogan Lovells, a law firm that helps companies comply with
new data rules....
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https://www.nytimes.com/2022/05/23/technology/data-privacy-laws.html
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