Reding outlines costs to business of EU privacy legislation

Viviane Reding, European commissioner for justice, fundamental rights and citizenship, has been outlining the costs and legal strategy behind forthcoming EU data privacy legislation.

Speaking at a public meeting hosted by the European People's Party, Reding said that the new plans, expected this summer, would impose some extra costs on businesses. However, these would be more than mitigated by a reduction of red tape within the EU and the opening up of the market to innovation.

"All fundamental rights have a cost. The right to the protection of data is not an exception," she said. "Costs are carried by businesses, administrations and citizens – actually by society as a whole. But I believe that companies have specific responsibility because data is often their main economic asset."

Reding said that by initiating an EU-wide framework for data management, the variable costs to companies of complying with a plethora of different legal frameworks in member states would be eliminated. The rules of applicable law will also be simplified to reduce costs further.

Compliance workloads would be cut further, she promised. The current system of notifications to data protection authorities will be cut back and the obligation to notify of some data processing activities will be eliminated.

It was important to get things equal across the EU in order to establish trust with the consumer, Reding warned. Without this, the ability of the technology industry to innovate and establish new business models would be impaired.

"There should be a level playing field for all companies in the EU. And no one should get away with avoiding the rules," she said.

"I strongly believe that the cost of no action in the field of data protection is much higher than the cost of improving the rules."

The speech will make interesting reading for the UK government, which has been critical of Reding's plans for data privacy, especially the so-called right to be forgotten. Ed Vaizey, the UK's communications minister, told a CBI meeting on Tuesday that the new laws must be proportional and not increase costs on business.