The Data Act establishes rules governing the sharing of data generated through the use of connected products or related services (e.g. the Internet of Things, industrial machinery) and allows users to access the data they generate. It will contribute to the development of new services, particularly in artificial intelligence, where vast amounts of data are required for algorithm training. It also aims to make after-sales services and repairs of connected devices cheaper. In exceptional circumstances or emergencies, such as floods and wildfires, public sector bodies can access and use data held by the private sector, the new law stipulates.
Protection of trade secrets and prevention of unlawful data transfers
During negotiations, MEPs included a clear definition of trade secrets and trade secret holders in the text to prevent unlawful data transfers and data leaks to countries with weaker data protection regulations, or situations where increased access to data is exploited by competitors to reverse-engineer services or devices. MEPs also ensured that businesses can benefit from a single point of contact for all matters falling under the regulation.
The new law facilitates switching between cloud service providers and introduces safeguards against unlawful international data transfers by cloud service providers. MEPs ensured that the Data Act places the cloud service customers at the centre and enables them to negotiate contracts, to avoid being "locked in" with a provider.
Quote
Lead MEP Pilar del Castillo Vera (EPP, ES) said: "The Data Act is a game-changer. Having data on the functioning of industrial equipment will allow factories, farms and construction companies to optimise operational cycles, production lines and supply chain management. The Data Act will create a new data-agile system that enables easy access to an almost infinite amount of high-quality data. It will be instrumental in optimising existing business models and processes, boost the development of new ones and create new value. In other words, an opportunity for innovation and competitiveness".
Next steps
The informal agreement will need to be endorsed by both the Parliament and the Council to become law.
Background
The volume of data generated by humans and machines is growing exponentially and becoming a critical factor for innovation by businesses and public authorities (e.g., shaping smart cities). The legislation will allow users access to the data they generate, as 80% of industrial data collected are never used, according to the European Commission.
Ref.: 20230626IPR00843
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