30 January 2017

Organisations have been invited to input into the decision-making process underpinning the European Commission’s "Building the European Data Economy" package. The Commission has invited manufacturers and users of connected devices, operators and users of online platforms, data brokers and businesses commercialising data-based products and services to respond to a consultation on the proposals.

The Consultation period will run until 26 April 2017 and has the objective of collecting information on:

  • whether and how local or national data localisation restrictions inhibit the free flow of data in Europe
  • whether and to what extent digital non-personal machine-generated data are traded and exchanged
  • the nature and magnitude of any barriers to accessing such data
  • ways of tackling those barriers
  • emerging Internet of Things (IoT) and robotics liability challenges
  • practices and issues relating to data portability, interoperability and standards
  • whether anti-competitive practices are restricting access to data and whether current competition law sufficiently addresses the potentially anti-competitive behaviour of companies holding or using data.


Whilst the Data Protection Directive, and from May 2018 the GDPR, regulate the processing of personal data in the EU, they do not address device-generated non-personal data or obstacles to the movement of personal data other than data protection laws, e.g. under accounting or taxation laws. The package announced by the European Commission sets out to address these barriers.

Within the package, the Commission also addresses “emerging issues" within the growing European "data economy" – a loose term referring to the growing network of machine-generated data related to the IoT.

Formerly referred to as the “Free Flow of Data Initiative”, the package is the final building block of the Commission’s Digital Single Market strategy.

Free-Flow of Data

“Data localisation" measures are any requirement that data be stored, processed or handled within a specified geographical area. Currently, various Member States have in place data localisation measures of varying levels of restrictiveness. Despite its original intentions, the Commission avoided proposing legislation prohibiting data localisation restrictions under this package. Instead, it proposes engaging in "structured dialogues" with member states "on the justifications for and proportionality of data localisation measures". Based on the results of the dialogues, the Commission may then "launch infringement proceedings to address unjustified or disproportionate data localisation measures".

Emerging Issues in the Data Economy

Some of the notable proposals set out by the Commission in this package are the introduction of:

  • Methods of encouraging the free flow of data within Europe, including:
    • industry technical standards to facilitate the exchange of data between different platforms;
    • creation of a “property-like” right over non-personal machine-generated data, with the aim of enhancing tradability;
    • an obligation to license machine-generated data generated on fair, reasonable and non-discriminatory terms;
    • extending the scope of the Unfair Contract Terms Directive requirements to B2B contracts; and
    • new rules to permit access by public authorities for public interest and scientific purposes.
  • Mechanisms to apportion liability for emerging technologies such as the IoT and autonomous connected systems. The Communication considers assigning liability to the "market players generating a major risk for others or to those market players which are best placed to minimise or avoid the realisation of such risk" alongside a voluntary or mandatory insurance scheme that could compensate injured parties. The Commission has separately launched an evaluation of the Product Liability Directive with specific reference to its appropriateness to deal with issues raised by emerging technologies.
  • Helping prevent customer "lock-in" to products or systems as a result of customers struggling to withdraw useful data. The package discusses measures relating to the portability of non-personal data and technical standards for interoperability.

Key contact

Mark Paterson

Mark Paterson Partner

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