A deal that allows thousands of companies to transfer data from Europe to the United States is invalid, the highest EU court said on Tuesday in a landmark ruling that follows revelations of mass U.S. government snooping.
Many companies, particularly tech firms, have said the Safe Harbour agreement helps them get round cumbersome checks to transfer data between offices on both sides of the Atlantic, including payroll and human resources information and also lucrative data used for online advertising.
But the decision by the Court of Justice of the European Union (ECJ) could sound the death knell for the system, set up by the European Commission 15 year ago and used by over 4,000 firms including IBM (IBM.N), Google (GOOGL.O) and Ericsson (ERICb.ST).
