The European Commission’s new data protection laws threaten business models that rely on sharing data to generate revenue, UK lobbying group the CBI has said.
The Confederation of British Industry made the claim in a submission to the Ministry of Justice, answering a ‘call for evidence’ on the EC’s new data protection laws.
As well as threatening emerging business models, the CBI said the new laws would also place a cost burden on all businesses as they are forced to comply with new, tighter regulations.
The CBI called on the EC to "revise its proposals, in favour of a proportionate, risk-based approach to the scope of data protection regulation, taking fully into account the benefits versus costs of any changes and their impact on innovative business models".
"Many novel business models rely on data sharing to generate revenue and offer a more individually tailored user experience," said Matthew Fell, the CBI’s director for competitive markets, citing advertising and the music industry as two areas that are being revitalised by data-sharing business models.
"It’s vital that governments here and in Europe support cutting-edge businesses to continue to innovate, before they get left behind by the rest of the world," Fell added.
The CBI said that new cost burdens of the legislation would include call centres to deal with issues arising from the changes, as well as the appointment of a data protection officer.
The new law proposals were revealed by the European Commission’s vice president, Viviane Reding, in January this year. She claimed that the new laws would actually save businesses €2.3 billion a year across the EU, by "streamlining" the approval process for multinationals moving data between European states.
James Mullock, head of data privacy at law firm Osborne Clarke, told Information Age that claim was “fatuous”, saying that although the reforms would be beneficial to business, they would come with increased costs.