Restrictions on Data Transfers and the WTO

Abstract

AbstractThe WTO is not well-known for being an institution that regulates the free flow of personal data across borders. The trade agreements under the auspices of the WTO either predate or coincide with the invention and early development of the internet. When the WTO was created in 1994, its members agreed to create rules for trade in services. Tim Wu observed that as a consequence, and almost by accident, “the WTO has put itself in an oversight position for most of the national laws and practices that regulate the Internet.” Wu (Chicago J Int Law 7(1), 264, 2006). Over a quarter century later, the internet has become indispensable for trade in services, facilitating not only communication and payment between parties involved in any transaction, but also as a platform for the transmission of the services themselves, and the driving technology for the creation of new services. The first section of this chapter shows how cross-border flows of personal data (on the internet) have become intertwined with the supply of many digital services (Sect. 4.1). The second section describes how the rules of the WTO on trade in services are relevant for the regulation of cross-border flows of personal data (Sect. 4.2). These multilateral trade rules can be used as proxies to distinguish between legitimate regulatory concerns and protectionism. Regarding the regulation of cross-border flows of personal data, these rules allow for the legal assessment of the line between data protection and data protectionism. The third section of this chapter analyzes whether the EU’s fundamental rights-based regulation of data transfers interferes with the rules of the WTO on trade in services (Sect. 4.3). The fourth section assesses whether the interferences that have been identified can be justified under the relevant exceptions to the rules of the WTO on trade in services (Sect. 4.4).