German data protection authorities have published leaked documents that suggest the 'Privacy Shield' accord that the EU and US agreed to falls short of the European Court of Justice's standards.
If the new transatlantic agreement is not accepted by data privacy authorities some of the data exchanged between companies in the EU and the US could be classified as illegal, according to European law.
Earlier this year, US multinational companies operating out of Ireland warned that if an agreement was not reached, jobs in Ireland could be threatened. Data authorities will not be able to immediately block the Privacy Shield accord. However, many legal experts believe that if the European Court of Justice was to challenge the agreement that it would have a high chance of blocking it.
Microsoft was the first multinational firm to publicly endorse the Privacy Shield accord and this move has led to objections to its legality in the EU.
Just last year, the EU-US 'Safe Harbour' data transfer treaty was nullified by the European Court of Justice. This was due to it finding that US authorities were practising indiscriminate surveillance towards EU citizens through data they acquired from the treaty. This came to light due to a case brought to the court by an Austrian student named Max Schrems who was concerned with how Facebook was transferring personal data to the NSA.
Schrems used the information leaked by Edward Snowden in regard to US security agencies frequently spying on the emails and messages sent by EU citizens in the case he brought against Facebook's Irish office.
The ruling in the 'Europe v. Facebook' lawsuit led to a new agreement being created between the EU and the US called Privacy Shield. The European Commission believes that the new agreement provides more transparency and oversight in regard to how data from the EU is handled.
Also, in cases where abuse by US authorities is suspected, an independent ombudsman would be provided to make sure that the cases were dealt with in a fair and judicious manner.