Privacy Shield, the agreement underpinning data transfers from Europe to America, must be suspended if the US does not fully meet its obligations come 1 September, MEPs voted last night.
The Civil Liberties (Libe) Committee's decision isn't binding, but puts pressure on the European Commission to ensure the data-transfer arrangement is being honoured by US authorities.
Drawn up to replace the abandoned Safe Harbor agreement in 2016 after that deal was brought down by a legal challenge, Privacy Shield now faces obstacles of its own.
Designed to extend EU-like data protection to European residents' data transferred to the US, now the Libe Committee believes the new agreement fails to provide that protection as well.
"While progress has been made to improve on the Safe Harbor agreement, the Privacy Shield in its current form does not provide the adequate level of protection required by EU data protection law and the EU Charter," said Libe Committee member Claude Moraes.
"It is therefore up to the US authorities to effectively follow the terms of the agreement and for the Commission to take measures to ensure that it will fully comply with the GDPR."
MEPs raised their concerns following the Cambridge Analytica scandal affecting Facebook, about which the social network's CEO, Mark Zuckerberg, gave evidence to the European Parliament recently.
While the incident pre-dates Privacy Shield, it was concerned about US authorities' ability to monitor US firms' compliance with the agreement, given both Cambridge Analytica's affiliate company, SCL Elections, and Facebook are both still listed on Privacy Shield.
SCL Elections still listed on Privacy Shield
MEPs also said they're concerned about a new US law called the CLOUD Act, which gives US authorities the right to access data stored in foreign locations, as long as the organisation storing it is American.
The Libe Committee said this could clash with EU law on data protection.
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