CEPA

European citizens, policymakers, and leaders have voiced anger that US prosecutors could demand access to personal information that should, in their view, remain private.

While Americans are narrowing abortion rights, Europeans are moving in the opposite direction. Since 2018, conservative Catholic countries such as Ireland have voted in favor of legalizing the procedure. Of the 27 European Union members, only Malta and Poland maintain restrictive laws. After the Supreme Court ruling, the European Parliament passed a resolution in favor of making the right to abortion part of the EU’s Code of Fundamental Rights, voting  324-155.

The split comes at a sensitive time in transatlantic digital relations. Data transfers across the Atlantic Ocean have been in jeopardy ever since 2020, when the European Court of Justice struck down a data transfer system known as  Privacy Shield. US surveillance of EU data sent across the Atlantic violates Europe’s General Data Protection Regulation (GDPR), the European court ruled.

Both European and American leaders have prioritized resolving the impasse. In March, EU Commission President Ursula von der Leyen and US President Joe Biden announced a political agreement on ‘Privacy Shield 2.0’. Details remain to be filled in. The White House is expected to publish an Executive Order outlining its compliance plans within weeks.

But since the Supreme Court ruling, Europeans have become concerned that US law enforcement will demand access to data to prosecute those seeking abortions. US data brokers already make money aggregating large swathes of data and reselling it.  The Federal government has acquired consumer data to bypass obtaining warrants and a reporter recently purchased a list of people who visited Planned Parenthood, a healthcare provider that can conduct abortions, for $160.  “While the right to privacy is enshrined as a fundamental human right in Europe, it is not in the United States,” says Mary Ziegler, the Stearns Weaver Miller Professor of Law at Florida State University College of Law.

“Location data is the biggest issue,” noted Jake Laperruque, Deputy Director of the Security and Surveillance Project at the Center for Democracy and Technology. Individuals could claim that they stopped using a period tracker app, but it’s hard to deny phone data showing visits to an abortion clinic and US courts already have accepted such evidence. Location data is much stronger than period tracker or other signs “to prove an abortion,” Ziegler maintains.

Tech companies are squeezed. In a blog post, Google said it will automatically delete location history of locations deemed “personal.” Examples include domestic violence shelters, abortion clinics, and addiction treatment facilities. Police warrants for such data have increased drastically since 2018, representing 25% of all warrants received in 2020, according to Google.

Other tech companies are following suit. Placer.ai and Safegraph, which previously sold information on individuals who visited Planned Parenthoods, have agreed to stop selling abortion data.

For transatlantic relations, the imminent danger centers on the new Privacy Shield. Europe’s GDPR provides strict protections for ‘sensitive data,’ including location “If US government agencies are able to bypass those commitments, that loss of privacy will have implications,” says Eduardo Ustaran, a partner at Hogan Lovells International LLP based in London.

European companies in the US could be subject to warrants to hand over data. Requests for location, health, and other sensitive data by law enforcement “would be regarded as a very severe infringement of the Privacy Shield principles,” Ustaran warns.

Despite the danger, the abortion debate still may not torpedo the construction of a Privacy Shield 2.0. In both Washington and Brussels, leaders want a deal, seeing it as a concrete move to improve relations from their turmoil with the Trump Administration and to keep a common front against Russian aggression in Ukraine.  “There is a strong determination to fix the Privacy Shield” on both sides of the Atlantic, making it unlikely these concerns will dismantle the effort altogether,” predicts Ivana Bartoletti, Global Chief Privacy Officer at the Indian tech company Wipro.

Yet, any renewed Privacy Shield will be fragile, subject to a new negative ruling by the European Court of Justice. The split over abortion could sway some European justices about the danger of allowing European personal data to be transferred across the ocean. “Some form of legal challenge is inevitable,” law firm Herbert Smith Freehills LLP concluded in a recent analysis.

Potential reforms in Washington could head off this danger.  A bipartisan group of Senators recently proposed Fourth Amendment Is Not For Sale Act that would close the data broker loophole.  A broad US Federal Privacy law would reassure Europeans. But given the difficulty of passing legislation in the divided US Congress, such a new piece of legislation looks unlikely.

Before the Supreme Court ruling, analysts say the US and Europe seemed to be moving in the same direction to expand privacy protections. Analysts now believe that momentum has been broken. A “global understanding of the right to privacy has been driving that convergence,” says Ustaran. This fight over abortion threatens to “destroy the work of many years.”

Grace Endrud and Daniel Hayes are interns at CEPA’s Digital Innovation Initiative. Bill Echikson edits Bandwidth.

The US invented the semiconductor industry and until now, there’s been no need for the government to intervene. But in recent years, the industry has become unbalanced. Asian governments, not only China but also South Korea, Taiwan, and others, are subsidizing production. The West – both the US and Europe – have become vulnerable. Intel and other US companies have been soldiering on solo and struggling.

The new law unlocks $52 billion for US chipmaking and billions more for research. It should rebalance global production, which has become concentrated in Taiwan, with capacity ramping up in China. The subsidies will make the US less vulnerable to hostile China and will attract inward investment from friendly countries. Already, Taiwan Semiconductor is building a multi-billion-dollar foundry in Arizona. Even if it is foreign-owned, this new Arizona foundry will create jobs, increase production, and bolster US self-sufficiency.  This is positive.

It’s understandable that chip designers are concerned.  While Intel, Micron, and other manufacturers will receive taxpayer dollars, fabless companies such as AMD, NVidia, and Qualcomm that design but don’t make chips are disappointed. The focus of the new bill is on manufacturing. AMD and Qualcomm will still benefit by gaining access to US-based foundries. This development will put downward price pressure on foundry suppliers by enabling US-based competition and decreasing fabless company dependence on China and the rest of Asia.

Our goal should not be to stop China from producing cutting-edge chips. In recent weeks, reports have emerged that China Semiconductor Manufacturing International Corporation has built a seven-nanometer chip. This is predictable and inevitable. Instead, US and European authorities should focus on supporting their own semiconductor industries and preventing state-controlled Chinese companies from competing unfairly.

China will use the same strategy as it did for telecommunications. Huawei bought market share in telecommunication infrastructure, leveraging subsidies from the Chinese state to undercut Western competitors by doing business at a loss. Huawei wiped out the UK firm Marconi because the British government at the time didn’t notice that this was unfair competition.

Today, this trick will be hard to repeat. The US and others are wary of becoming dependent on China for key technologies, starting with semiconductors. Although Qualcomm, NVidia, and other chip designers will still use Chinese foundries to supply the Chinese market, they will not become over-dependent on them.

Another concern is whether we are subsidizing chips just as the global semiconductor shortage turns into a glut. The semiconductor industry is cyclical. In 2001, the big change from 200 mm to 300 mm wafer size encouraged manufacturers to invest in massive new equipment. The resulting rush and race into production to recoup the high investment costs caused oversupply. Today, as we move to seven-millimeter chips, manufacturers again are investing, so some predict this will again cause another glut.

I think shortages will persist. China’s zero Covid-policy has shut down entire cities and plants, so it is producing below capacity.  Although it’s possible that a surplus will emerge in commoditized chips, the CEO of Intel believes the shortage of semiconductors in strategic industries, particularly for cars and advanced weapons will continue. I believe he’s right.

Europe should welcome the US move. Until recently, the EU has mainly acted as a competition regulator – ensuring, for example, that the Germans didn’t give Infineon an unfair advantage over France and Italy’s STM. That’s difficult when companies outside of the EU are receiving large subsidies. While Europe practiced laissez-faire, its share of global semiconductor production fell from 35% in 1990 to 9% this year. The EU has recognized the problem and has passed its own Chips Act, earmarking EUR43 billion.

The EU Chips Act does not portend a subsidy war with the US. It’s complimentary. Intel and other US companies with facilities in Europe can receive money from both Europe and the US. Together, the West can construct robust supply chains that are not dependent on China. We should encourage transatlantic mergers as alternatives to Chinese acquisitions – a good example is the 2015 $40 billion merger between the Netherlands NXP Semiconductors and the US’ Freescale Semiconductors

Export controls pose a difficult question. Europe manufactures the world’s most advanced lithography machines (needed to manufacture semiconductors) and the US is pressing ASML of the Netherlands to refrain from selling its most advanced machines to China. The Dutch want to export and sell as much as possible. We need some sort of compromise: in return for holding off on exporting to China, ASML should get some favors from the US.

My own country, the UK, is unfortunately absent from this debate. We sold our largest semiconductor foundry last year to the Chinese.  We do have one important asset left – ARM, which designs chips. I hope that the UK government understands its value. The UK must come to its senses and realize that we need to work closely with Europe. It would be great if we participated in a future EU Chips Act. We missed the boat on this one.

Bipartisan support behind the US Chips Act is encouraging. In technology, it shows that there are smart people on both sides of the political divide who are coming together to make the right decision.

Christopher Cytera is a Non-resident senior fellow with the Digital Innovation Initiative at the Center for European Policy Analysis and a technology business executive with over 30 years of experience in semiconductors, electronics, communications, video, and imaging.

Question: Is the fight against terrorist hate speech still a priority? After all, we haven’t suffered from terrorist attacks recently.

Answer: If you take all the terrorist attacks in Europe over the last ten years, it is probably fair to say that all of them relied on some organization done on an online platform – whether it is the terrorist cell that attacked Brussels and Paris in 2016, the ‘lone wolf’ Manchester Arena bomber, or others. In each case, individuals were radicalized or organized their attacks through an online platform.

This danger has not gone away. Since the fall of its caliphate, ISIS has turned its attention even more to Europe, and that’s why we must track these cells. Thankfully, Europe’s police and counter-terrorism forces have increased cooperation. They are foiling attacks, but we still face a deadly and real Islamist threat, and now Ukraine adds a new element to the terror threat.

Question: How is the war in Ukraine related to this terrorist threat?

Answer: European fighters are returning from the war zone and are security risks. Since 2014, an estimated 17,000 foreign fighters have been involved in combat. Some are on the Russian side; some are on the Ukrainian side. Ukraine is a focal point for malcontents. Many are either far right or far left in terms of their ideology. We know that some were involved in the violent Yellow Jacket protests in France.

Much of the recruitment is done on the Internet, on Telegram, Messenger, WhatsApp, and Facebook, among other platforms. It targets vulnerable and isolated individuals – usually young men. It teaches them deadly skills.

Question: How should we respond?

Answer: You want to regulate without destroying innovation. You want to close weaknesses and loopholes. The platforms must be forced to act, because they have allowed this content to flourish, or at least turned a blind eye to it.

Europe’s terrorist content bill came into effect just two months ago and represents a positive step forward. The Counter Extremism Project, with whom I work, supported it.  The bill is not a vague catchall like hate speech legislation, which is subjective, open to misinterpretation, and raises legitimate freedom of expression concerns. This terrorist content law defines what type of videos and other content are considered to be terrorist. It is explicit. Bomb-making videos, for example, are forbidden. These videos are not a reasonable expression of speech – they are designed for malign purposes. Under the new European law, police notifications to remove such content are binding.

We could and should have gone further – mandating takedowns. Terrorist content continues to proliferate online, not just hundreds of thousands or millions of videos and images, but billions of pieces of content. In many cases, removed images just reappear. Platforms should be obliged to use hashing technology to keep illegal videos from reappearing.

A tragic example is the 2019 Christchurch attack on a mosque in New Zealand. It was live-streamed and went viral. Two months after the tragedy, the video was still available online.

Question: But didn’t the Christchurch Call represent a turning point when leaders began to speak out about getting tough on online extremism?

Answer: It was just a declaration that asks the tech companies to self-regulate. I believe government must step in. In no other sector would you allow such self-regulation – would you not regulate financial services after the global crash, would you not regulate aviation for health and safety? You cannot expect companies to self-regulate.

In my opinion the Christchurch Call has fallen flat, while Europe has moved ahead.

Question: What are the next steps?

Answer: Tech companies resisted a specific time for takedowns. I think there should be a 60-minute window. If you don’t get the material down fast, it mushrooms and becomes impossible to contain.

Europe’s Digital Services Act represents another positive step. It forces big platforms to step up because there are potential significant fines, up to 6% of turnover.

There’s much more that could be done. The DSA does not mandate the use of specific technologies, so we now have a system that is not consistent across platforms.

Question: And transatlantic relations? Will this issue divide Washington and Brussels?

Answer: It’s a good question. Europe is certainly ahead of the US for a number of reasons. In the US you have specific constitutional protections on free speech. That imposes a barrier, making lawmakers cautious.

From a practical point of view, most of the large tech success stories are American and there’s a risk of the US perceiving these measures as targeting US tech companies and as being protectionist. I think there is a consensus between the current US Administration and the EU that tech needs to be regulated. There is no need for this issue to generate massive tension. It’s good that both sides are discussing it at the Trade and Technology Council.

Lucinda Creighton is a non-resident Senior Fellow at CEPA and the former Irish Minister of European Affairs.  She is a Senior Europe Advisor to the Counter Extremism Project.

Photo: French police block the access to the Bataclan concert hall before the visit of members of a French parliamentary committee investigating government measures to fight shooting and bombing attacks at the site four months after a series of attacks at several sites in Paris, France, March 17, 2016. REUTERS/Benoit TessierTPX IMAGES OF THE DAY