Free transfer of personal data to Republic of Korea: a historic adequacy decision is coming
The European Data Protection Board (“EDPB”) has issued its opinion on the draft adequacy decision published by the European Commission on last 16 June 2021 (available here) concerning the transfer of personal data to the Republic of Korea.
This is a decision that, once in force, will allow the EU economic operators – such as, first of all, all the electronic communication service providers, cloud providers and multinational companies - to freely transfer personal data from Europe to the Republic of Korea without having to adopt either the appropriate safeguards (e.g., "Standard Contractual Clauses") or the additional measures (e.g., consent of data subjects) required by Chapter V of EU Regulation No. 679/2016 ("GDPR").
Indeed, pursuant to articles 44 et seq. of the GDPR, the transfers of personal data to countries outside the European Economic Area or to an international organization are allowed provided that the adequacy of the third country or organization is expressly recognized by a decision of the Commission.
We will now examine in detail the contents of the opinion issued by the EDPB.
Firstly, it was noted that the Republic of Korea's legal framework on the protection of personal data is substantially aligned with the European one, especially with regard to the main definitions provided for by law (“personal data”, “processing” and “data subject”), the requirements for a lawful data processing, the general principles and the security measures.
This has been possible not only thanks to the presence of an effective privacy law (i.e., the "Personal Information Protection Act" or "PIPA" which came into force in 2011) but also because of a series of "notifications" (included the “Notification no. 2021-1”) issued by the Korean Data Protection Authority (i.e., "Personal Information Protection Commissioner" or "PIPC") which explain and make easily understandable the provisions of PIPA.
Moreover, as noted by the EDPB, the Republic of Korea is part of a number of international agreements that guarantee the right to privacy (including the "International Covenant on Civil and Political Rights", the "Convention on the Rights of Persons with Disabilities" and the “ONU Convention on the Rights of the Child"), which confirms the attention that the Republic of Korea has paid to the protection of personal data for several years now.
The EDPB's analysis then focused on some key aspects of PIPA that slightly differ from the GDPR and therefore require more attention - such as, in particular, the absence of a general right to withdraw the consent provided by the data subjects, for example, for marketing activities.
According to the EDPB, although article 37 of PIPA grants data subjects the right to request the “suspension” of the processing of their personal data - a right that can be exercised also in case of direct marketing, as expressly clarified by Recital 79 of the EU Commission adequacy decision – the PIPA provides for the right to withdraw the consent only in two specific cases:
- in relation to the transfers of personal data carried out in the context of special corporate operations (such as mergers, acquisitions, etc.);
- with regard to the processing of personal data for marketing activities by providers of electronic communication services.
The EDPB therefore considered it necessary to draw the Commission's attention to the above-mentioned issues in order to analyze in detail the consequences that, in the light of the Korean legal framework, the absence of such a right might cause for data subjects and to clarify, in the adequacy decision, the actual scope of the above-mentioned right to request the “suspension” of the processing.
Secondly, the EDPB observed that, pursuant to article 58 of PIPA, a substantial part of PIPA - including Chapters III, IV and V, which respectively regulate the general principles for data processing, the security measures and the rights of data subjects - does not apply to several processing of personal data (including those necessary to meet urgent needs for the protection of public health and safety).
The EDPB also notes that the word “urgent” in the PIPA expresses an extremely broad concept that needs to be limited and contextualized, also with the help of practical examples, in order not to compromise the confidentiality of the data subjects’ personal data.
Moreover, the EDPB, in the light of the current emergency situation caused by the Covid-19 pandemic, drew the Commission's attention in relation to the need to ensure an adequate level of protection also for personal data transferred to the Republic of Korea for purposes related to public health protection.
This is because "sensitive" information relating to European citizens (for example, the vaccination status), should receive at least the same level of protection as granted under the GDPR once transferred to the Republic of Korea. In this regard, the EDPB therefore invited the Commission to closely monitor the application of the exemptions provided for in article 58 of PIPA.
Finally, the EDPB considered it appropriate to focus on the possibility for Korean public authorities to access the personal data of European citizens for national security purposes. In this respect, there is no specific obligation for Korean authorities to inform data subjects of the access to their personal data, especially when data subjects are not Korean citizens.
However, even in the absence of such obligation, the balance between the needs of protection of the national security and the protection of the fundamental rights of the data subjects can be found in the same Korean Law that protects the privacy of interpersonal communications (the "Communications Privacy Protection Act" - see also Recital 187 of the adequacy decision), according to which the access to the personal data of European citizens for purposes of national security can be made only if certain legal requirements are met (for example, in the case of communications between "foreign agencies, groups or citizens suspected of being involved in activities threatening national security").
The EDPB notes that, as a further guarantee of the confidentiality of communications accessed by the Korean authorities, the South Korean Constitution states essential data protection principles applicable to this specific matter.
In the light of the favorable opinion issued by the EDPB, it is certainly desirable, and likely, that the European Commission will adopt an adequacy decision in respect of the Republic of Korea.
In an increasingly data-driven global economy based on the economic value of personal data as well as on the sharing of personal data, such an adequacy decision would open the door to the liberalization of trade with the east, also from a privacy perspective.
This regulatory intervention, object of this article, was due and awaited and it certainly follows the "Free Trade Agreement" between the EU and South Korea in force since 2011, which has been able to exponentially increase bilateral trade between the two countries (in 2015 the trade value of transactions amounted around € 90 billion).
Our hope is that, as the years go by, the European Commission's adequacy assessments will cover more and more legal frameworks so that the international transfer of personal data can represent a real and concrete instrument for promoting the economy and innovation worldwide.
EU - UK agreement (so-called “Brexit”): the birth of the “comparable trademark”
It is well known by now that on 24 December 2020 the European Union and the United Kingdom reached an agreement for regulating their future commercial relations following “Brexit”.
This agreement seals the definitive separation between the British and European legal systems and, starting from the date of its enactment (i.e., 1 January 2021, namely the end of the transition period), the rules of European Union law will no longer apply to the United Kingdom, including those concerning intellectual and industrial property rights.
With a view to ensuring an orderly transition towards the new legal regime, the European Commission published a series of “Notices of Withdrawal” (related to the main sectors of European economy) which set out the main practical consequences that will affect the owners of intellectual and industrial property rights.
In particular, the Notice concerning trademarks specifies that, among other things, the owner of an EU trademark registered before 1 January 2021 will automatically become the owner of a “comparable trademark” in the United Kingdom, resulting as registered and subject to opposition in the United Kingdom, in accordance with the laws of that country.
This notion of a “comparable trademark” appears to be new within the field of IP rights, in so far as it was specifically introduced for the purpose of protecting those who – before the definitive withdrawal of the United Kingdom from the European Union – had obtained protection for their EU trademark which, at the time, produced effects also with respect to British territory.
The European Commission – evidently aware of the novelty of this legal concept – in the same Notice clarified that such “comparable trademark”:
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- consists of the same sign that forms the object of EU registration;
- enjoys the date of filing or the date of priority of the EU trademark and, where appropriate, the seniority of a trademark of the United Kingdom claimed by its owner;
- allows the owner of an EU trademark that has acquired a reputation before 1 January 2021 to exercise equivalent rights in the United Kingdom;
- cannot be liable to revocation on the ground that the corresponding EU trademark had not been put into genuine use in the territory of the United Kingdom before the end of the transition period;
- may be declared invalid or revoked or cancelled if the corresponding EU trademark is the object of a decision to that effect as a result of an administrative or judicial procedure which was ongoing before 1 January 2021 (on a date following the “cloning”).
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The British Government has confirmed that it will fall to the competent office of the United Kingdom to proceed without cost with the “cloning” of EU trademarks in the United Kingdom, where they will become “comparable trademarks”. It is not required of the owners of EU trademarks to file any request, nor to commence any administrative procedure in the United Kingdom, nor is it necessary for them to have a postal address in the United Kingdom for the three years following the end of the transition period.
Despite the precise description of the main features of the new “comparable trademarks”, there are – inevitably – uncertainties surrounding the practical application of this legal concept.
In particular, it is puzzling to find that the “comparable trademark” continues to be influenced by European administrative and judicial occurrences (see point e) above), which conflicts with the alleged independence of the United Kingdom from European laws and regulations.
Such inconsistencies evidently have already been noted, in so far as the Notice specifies (in a footnote) that the parties have acknowledged that the United Kingdom “is not obliged to declare invalid or to revoke the corresponding right in the United Kingdom where the grounds for the invalidity or revocation of the European Union trade mark … do[es] not apply in the United Kingdom”. It would seem therefore that the United Kingdom is invested with the power to not conform itself to European decisions.
However, it is not clear what should prevail in this “contest”: the invalidating decision of the European proceedings or British power to deny the effects of such European decision?
Furthermore, if the European proceedings – albeit commenced before the end of the transition period – should last for several years, how should the owner of the “cloned” trademark in the United Kingdom behave? Again, how are we to reconcile the existence of a “comparable trademark” – contemporaneously subject to European and British jurisdiction – with the known principle of territoriality applicable to the world of trademarks?
The situation appears somewhat uncertain and, in our opinion, it cannot be excluded that other issues concerning this new “comparable trademark” may arise in the future and form the object of open debate by those operating in the IP industry.
This is a key point that concerns not just acquired rights (which the British Government has undertaken to protect), but also the future political relations between the EU and the United Kingdom; indeed, it is interesting to note in this regard how such a seemingly innocent subject, namely trademark law, may in fact reveal the frailty of an agreement which is formally commercial but in reality turns out to be predominantly of a political nature.
In light of all the above, it would seem that the EU and the United Kingdom have chosen to follow the easiest path for protecting owners of EU trademarks in the midst of an orderly transition towards a new legal regime imposed by Brexit; on the other hand, this decision raises several legal questions, some of which have been anticipated above, which introduce a measure of uncertainty concerning the new “British hybrid” trademark.
Finally, we cannot fail to note how this new legal concept may represent an interesting precedent in the event that other Member States may decide in the future to leave the European Union. In that regard, we find ourselves before a new concept that certainly seems interesting from a legal standpoint, but potentially may also be “dangerous” from a political point of view and, as such, deserving of close attention in the coming years.