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For the past year or two,
foreign cloud providers -- particularly some based in the EU -- have been
making claims and insinuations about the scope and use of the Patriot Act in an
attempt to secure a marketing advantage over their US competitors. This effort
has become so blatant as to provoke push-back from no less than European
Commission Vice Commissioner Viviane Reding. This Emerging Issues Analysis
discusses the reality of the situation.
EU Privacy -- As a result of the 1995 European Union Data
Protection Directive (the "Directive"), EU data protection law
imposes a rigid regime of restrictions on the processing and transfer of
The USA PATRIOT Act -- In October 2001, in response to the 9/11
terrorist attacks, Congress enacted an anti-terrorism statute (the
"Patriot Act"). This statute, inter alia, permits the US
government to acquire records relating to foreign intelligence or international
terrorism on a less robust showing than would be required for investigating a
domestic crime or a violation of the Foreign Intelligence Surveillance Act.
Cloud Computing -- Over the past few years, the popularity of cloud
computing has mushroomed. Many leading cloud providers are US companies.
Cheap Shots -- For the past year or two, foreign cloud providers --
particularly some based in the EU -- have been making claims and insinuations
about the scope and use of the Patriot Act in an attempt to secure a marketing
advantage over their US competitors. This effort has become so blatant as to
provoke push-back from no less than European Commission Vice Commissioner
Viviane Reding. Ms. Reding "openly called upon cloud service providers to
refrain from a nasty habit that more and more of them have gotten into this
year [and] should stop offering themselves to European customers as data
shelters from the prying eyes of American lawmakers." The underlying theme
in such allegations is that Europeans and others had better use EU, and not US,
cloud providers. "Some countries are using unfair policies to
intentionally disadvantage foreign competitors and grow their domestic cloud
computing industry." [footnotes omitted]
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