The EU Data Act has been adopted by the European Parliament, paving the way for increased innovation and competitiveness. The legislation aims to remove barriers that hinder access to data for consumers and businesses, particularly in artificial intelligence where massive amounts of data are required for algorithm training.
The EU Data Act aims to address the fact that 80% of industrial data collected is never used, according to the European Commission. To combat this, the law establishes common rules for sharing data generated by connected products or services, ensuring fairness in data sharing contracts. The law also rebalances negotiation power in favor of small and medium-sized enterprises (SMEs) to shield them from unfair contractual terms imposed by larger companies.
The EU Data Act also defines how public sector bodies can access and use data held by private sector entities in exceptional circumstances or emergencies, such as during floods or wildfires. Additionally, the law strengthens provisions to protect trade secrets and prevents increased access to data from being used by competitors to retro-engineer services or devices. The act also sets stricter conditions on business-to-government data requests.
The EU Data Act also facilitates switching between cloud service providers and other data processing services, while introducing safeguards against unlawful international data transfers by cloud service providers.
Lead MEP Pilar del Castillo Vera (EPP, ES) commented, “The EU Data Act will be an absolute game changer, providing access to an almost infinite amount of high-quality industrial data. Competitiveness and innovation are part of its DNA.”
The European Parliament, on November 9, 2023, overwhelmingly approved the final text of the Data Act with 481 votes in support, 31 opposing, and 71 abstaining. Initially proposed by the European Commission on February 23, 2022, the Data Act’s primary goal is to foster fairness in the digital environment, encourage a competitive data market, catalyze data-driven innovation, and enhance data accessibility for everyone.