By Kelley Chittenden

Two sources with direct knowledge of Facebook’s discussions with Egypt over its Free Basics service said the Egyptian government blocked it because Facebook refused to allow the government to circumvent security and conduct surveillance on its citizens, Reuters reports. Free Basics, which allows anyone with a computer or smartphone to access a limited set of free Internet services was launched in Egypt in October 2015 and used by over three million Egyptians, one third of whom had never previously had Internet access. Facebook strengthened security protections in September, allowing users to connect seamlessly with secured sites.

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April 13, 2016

By Kelley Chittenden

The Liberal/National and Labor parties of Australia passed data-retention laws last year allowing enforcement agencies warrantless access to two years of customer data (including call records, billing information, and IP addresses) stored by telecommunications companies. The Australian Federal Police (AFP) responded to a notice containing data-retention-related questions posed by Senator Xenophon during Senate Estimates hearings. The AFP contends it is unable to provide information regarding the handling of metadata of federal politicians without contravening provisions of the Telecommunications (Interception and Access) Act of 1979. Computerworld reports that AFP issued a public statement in February saying it did not access or apply to access journalist metadata since the data retention laws took effect in October 2015.

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April 12, 2016

By Kelley Chittenden

The Hamburg Data Protection Authority, Johannes Caspar, intends to “crack down” on three companies that allegedly still use the Safe Harbor framework as a legal basis for cross-border data transfers, according to Fortune. While company names have not yet been released, Caspar describes them as “large international companies.” The U.S. and the EU announced an agreement on a new transatlantic data flow, called the EU-U.S. Privacy Shield. Although data protection regulators said they would temporarily delay enforcement actions, there is nothing stopping them from fining companies before Privacy Shield is finalized, should they choose to do so.

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March 15, 2016

By Kelley Chittenden 

Mark Zuckerberg’s plans to “connect the entire world” hit a speed bump the first week of February when Indian regulators blocked Free Basics, his free mobile data program. The Telecom Regulatory Authority of India (TRAI) issued regulations banning differential pricing for data services in order to restrict the ability of mobile phone companies to “shape the users’ Internet experience” by offering free access to certain services. According to The Guardian, the process began in March of 2015 with a consultation paper recommending telecom operators be allowed to charge extra for third-party apps and services such as WhatsApp, Facebook and Twitter. TRAI sought public comment on twenty questions, which led to a “spirited, pro-net-neutrality campaign” called Save The Internet and 1.1 million responses against differential pricing by late April.

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March 10, 2016

By Kelley Chittenden

Facebook CEO Mark Zuckerberg said hate speech “has no place on Facebook” while speaking at a town hall in Berlin.  After online racism increased due to the influx of migrants in 2015, Facebook, Google, and Twitter made a deal with Germany that they would remove hate speech posts within twenty-four hours. Zuckerberg credits learning more about German law as the catalyst for Facebook’s expanded view of protected groups (to now include migrants). Reuters reports that Facebook has hired a Bertelsmann business services unit to monitor the German platform for racist posts.

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March 10, 2016

By Kelley Chittenden

Google recently announced a contentious $185 million settlement regarding back taxes following a six-year inquiry from British tax authorities. British Prime Minister Cameron defended the deal, while both the opposition Labour Party and Conservative politicians have questioned it, reflecting popular opinion that multinational companies such as Google are treated too generously. The presence of multinational corporations such as Google in various nations can increase global competitiveness, but European Union officials plan to address the issue of improper tax breaks resulting from corporate sidestepping.

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February 12, 2016

By Kelley Chittenden

A Belgian court order threatened Facebook with fines of up to €250,000 per day if the social network did not stop tracking Internet users without Facebook accounts. Research reveals Facebook tracks users that visit its page regardless of whether the user has an account or has opted out of tracking in the EU. The cookie placed on the user’s device allegedly allows Facebook to access information whenever the user visits Facebook pages or pages that include “like” or “share” links. Facebook claims the cookie protects user security, and the social network is appealing the order in part due to its inclusion of English words such as “cookie” and “web browser” to describe its tracking technology. Although Belgian law requires rulings be made in Dutch, French, or German, “web browser” in Dutch is “webbrowser,” and an Internet cookie is “cookie” in each language—Facebook appears to have a weak argument in this respect.

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February 09, 2016

By Kelley Chittenden

Russia is demanding Twitter to store the personal data of Russians locally. A controversial data localization law requiring Internet services to store the personal data of Russian citizens on servers located in Russia went into effect at the beginning of September. Although Russia’s Internet Regulator, Roskomnadzor, said Twitter was not subject to the law back in July, Radio Free Europe reports a change in Twitter’s user agreement prompted the announcement. Russia can block and fine sites that do not comply, and Roskomnadzor will apparently “wait patiently” for news of compliance. 

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November 27, 2015

By Kelley Chittenden

The Paris attacks re-sparked the encryption debate on whether government agencies should be able to have “back-door” access to encrypted communications. Apps such as iMessage and WhatsApp are encrypted by default, and lawmakers and government officials have urged the technology industry to incorporate means for government circumvention in the name of national security. Robert Litt, the General Counsel of the Office of the Director of National Intelligence, has said push-back against creating government backdoors may change in the event of a terrorist attack in which encryption hinders law enforcement; however, there is currently no evidence that back-doors to encryption would have prevented the attacks.

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November 26, 2015

By Kelley Chittenden

The United States House of Representatives passed the Judicial Redress Act (the Act) on October 20, 2015, which proposes to allow non-U.S. citizens the right to bring civil actions against United States agencies under the Privacy Act of 1974. Under the Act, the Department of Justice (DOJ) is authorized to designate foreign countries or economic integration organizations whose citizens may challenge unlawful disclosures of records transferred from foreign countries to the United States. The DOJ designations are exempt from judicial or administrative review, and the U.S. District Court for the District of Columbia is granted exclusive jurisdiction over claims. The following Reed Smith Client Alert analyzes the effectiveness of the Act here:

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November 25, 2015

By Kelley Chittenden

Photo Credit: www.perspecsys.com Photo License

In an attempt to assuage data security concerns in the cloud, Microsoft Corporation recently announced the decision to offer European customers an option to store their cloud data in German data centers under control of T-Systems, a subsidiary of Germany’s largest telecommunications company, Deutsche Telekom. In the words of Deutsche Telekom’s CEO, Timotheus Höttges, “Microsoft is pioneering a new, unique, solution for customers in Germany and Europe. Now, customers who want local control of their data combined with Microsoft’s cloud services have a new option, and I anticipate it will be rapidly adopted.”

The Financial Times reports Microsoft’s lawyers believe they have devised “bulletproof” legal arrangements in Germany. The company plans to offer cloud services such as Azure, Microsoft Office 365, and Dynamics CRM Online from two data centers located in Germany under the third party control of a “trustee model.”

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November 20, 2015

By Kelley Chittenden

The Article 29 Working Party (WP29) recently issued much-needed post-Safe Harbor guidance. In a landmark ruling on October 6, 2015, the European Court of Justice declared the Safe Harbor agreement between the United States and the European Union invalid, leaving many companies with international operations in legal limbo. The agreement had been in place since 2000 and required over 4,000 companies to treat information moved outside of the European Union with an adequate level of data protection. The ECJ said data protection regulators should have oversight over the collection and use of information from European Union citizens, a belief substantiated in part by the Snowden revelations, which created a sense that American intelligence agencies infringe the right to privacy of Europeans. WP29 issued an opinion this week, appearing to suggest that model clauses and Binding Corporate rules remain viable options and that a new U.S.-EU agreement is encouraged to be in place by next January.

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October 23, 2015

By Kelley Chittenden

Malaysian authorities detained a 20-year-old citizen of Kosovo named Ardit Ferizi based on a U.S. arrest warrant, according to a statement released by the Department of Justice. Federal prosecutors charged Ferizi with hacking personal information of over 1,000 U.S. military personnel and federal employees and providing the information to the Islamic State and Greater Syria. Assistant Attorney General John Carlin describes the hacker teaming up with a terror group to target Americans as a “first-of-its kind-case,” The Wall Street Journal reports. Ferizi is expected to be extradited to the U.S., where he could face up to thirty-five years in prison if convicted of providing material support to the Islamic State, unauthorized access to a computer, and aggravated identity theft.

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October 22, 2015

By Kelley Chittenden

Vladimir Drinkman and Dmitriy Smilianets pleaded guilty this week to involvement in the largest computer hacking conspiracy ever prosecuted in the United States. The men infiltrated sixteen companies’ networks including NASDAQ, 7-Eleven Inc., France’s Carrefour S.A., J.C. Penney Company Inc., JetBlue Airways, a Visa Inc. licensee, and Heartland Payment Systems, Inc., compromising over 160 million credit card numbers and racking up more than 300 million dollars in losses over nearly seven years. Drinkman had been in U.S. custody since his extradition to the United States after a June 2012 arrest in the Netherlands. Three other men involved in the hacking of security networks and mining of personal data, Aleksandr Kalinin, Roman Kotov, and Mikhail Rytikov, still remain at large.

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September 24, 2015

By Kelley Chittenden

The China Information Technology Security Evaluation Center, a Chinese Government agency, has asked U.S. tech companies to sign a pledge committing to policies such as withholding from harming China’s national security and storing Chinese user data within China’s borders. The document also asks that the tech companies pledge they will ensure their products are “secure and controllable,” which could potentially require third-party access to systems and sharing of encryption keys or source code. Although U.S. tech companies are reluctant to sign, many also want to take advantage of massive business opportunities in China, home to the world’s biggest Internet market. China’s influence over the U.S. tech industry will take form in the U.S.-China Internet Industry Forum held in Seattle next week.

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September 22, 2015

By Kelley Chittenden

Google recently responded to the European Commission’s formal antitrust charges with a 150-page rejection defending its comparison-shopping service. The European antitrust chief, Margrethe Vestager, filed charges last April accusing Google of systematically favoring its own search results. Google General Counsel Kent Walker summarized the company’s defense in an August 27th blog post, arguing the regulators “are wrong as a matter of fact, law, and economics.” The European Commission will now review Google’s response before making a final decision, which could be a fine of up to ten percent of Google’s annual revenue. In the meantime, Avisa Partners and Hausfeld & Co LLP are lining up clients through the Google Redress & Integrity Platform (GRIP) to pursue further cases in the event Google loses the case.

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September 11, 2015