Viviane Reding paves way for EU-wide data privacy rules

The European Union needs a single data protection policy that all member states abide by, according to EU Justice Commissioner Viviane Reding.

Europe's data protection rules are currently formed at state level, which leads to complications for businesses operating across the region as they have to comply with 27 different sets of rules.

Reding said in a speech at the American Chamber of Commerce to the EU that the administrative burden associated with this fragmentation costs organisations an estimated €2.3bn a year.

"The fragmentation, inconsistency and incoherence of 27 data protection laws make it difficult to sell or shop cross-border," she said. "They also create barriers to market entry, particularly for small and medium-sized companies."

Reding explained that the European Commission will propose reforms that will see a "one-stop shop" for businesses when it comes to data protection.

"At the same time, we must strengthen co-ordination and co-operation between national data protection authorities to make sure that the rules are enforced consistently," she said.

"As a result, companies will be able to sell goods and services under the same data protection rules to 500 million people - a fantastic business opportunity."

Reding suggested that existing European Union rules on data protection need to be updated, as they were first adopted in 1995 when the full potential of the internet had not yet been realised.

"Although the basic principles and objectives of the 1995 Directive remain valid, these rules are not adapted to some new and emerging technologies and applications like social networks," she said.

"I want to improve the current system of binding corporate rules to make this type of exchange simpler and less burdensome and to cut down on the time and money invested by companies."