Proposed EU Data reforms âworse for UK businessesâ than feared

The Direct Marketing Association (DMA) has raised industry concerns that the latest changes to EU proposals on consumer data protection reforms are "far worse for UK businesses" than originally conceived. The DMA’s comments follow the publication (8 January 2013) of the latest version of the European Parliament Committee’s proposed amendments to the draft EU Data Protection Regulation.

The amendments to the Regulation were made by German Green Party MEP Jan Albrecht of the European Parliament's Civil Liberties, Justice & Home Affairs Committee.

According to the DMA, Albrecht's amendments to clauses such as those regarding the definition of personal data, limitations on customer profiling, consent to direct marketing and the so-called 'right to be forgotten' will severely infringe the right of businesses to use data to market their goods and services to consumers. This would have an immediate knock-on effect for businesses; recent research published by the DMA revealed that UK businesses invested £14.2 billion in data-driven marketing in 2012, which generated 23% of their total sales.

The trade association, which represents the UK’s multi-billion pound direct marketing industry, fears that EU lawmakers have failed to address the industry’s concerns on the original proposals as they have yet to strike the appropriate balance between protecting consumer rights to data privacy and the legitimate interests of business.

Commenting on the European Parliament’s Draft Report, Caroline Roberts, Director of Public Affairs of the DMA, said:

“The original draft of the Regulation posed a severe threat to the viability of UK businesses that depend on direct marketing to drive sales. These amendments are even worse for UK businesses. The proposed legislation is overly strict and unworkable. It will stifle innovation, add considerable cost to business and place unnecessary obstacles to e-commerce jobs and growth.”

“This announcement has now made data protection a priority for businesses, and we call on them as a matter of urgency to get involved. Our data protection conference on 8 February will help businesses to get informed and get involved to raise political awareness of what's at stake."

Roberts added:

"We’ve been leading the industry’s efforts since 2009 to ensure that the EU’s policymakers take the industry’s interests into full consideration. We'll continue to lobby both UK Ministers and MEPs, alongside our industry colleagues under the umbrella of the Advertising Association, to ensure they understand the need to create a balanced piece of legislation that protects the data privacy rights of individuals and the commercial interests of businesses."

Research published by the DMA in August 2012, estimated that the draft Regulation in its current form could cost UK businesses an estimated £47 billion in lost sales and additional regulatory costs.

Data Protection 2013 will feature Information Commssioner Christopher Graham, Microsoft's chief envisaging officer Dave Coplin and speakers from the DMA.

Contact
Lakruwani Herath-Culley, PR executive
Tel. 020 7291 3324
Email lakruwani@dma.org.uk

Tristan Garrick, Head of PR & Content
Tel. 020 7291 3315
Email tristan.garrick@dma.org.uk

Notes to Editors

• Mr. Albrecht’s Report is likely to be amended before a final vote is taken by all MEPs in the early summer. The draft Regulation is also being considered by the governments of the 27 EU Member States in the Council of Ministers. Their final positions of the Parliament and the Council need to be agreed with the European Commission and negotiations are likely to take some months. It is unlikely that final legislation would become law throughout Europe until 2015/16.
• The original proposals from the European Commission were not at all helpful to the direct marketing industry, as they did not strike the appropriate balance between consumer rights and the legitimate interests of business. Mr Albrecht’s report does nothing to redress this balance. For example:

Profiling – Almost a general ban on profiling is proposed, including any form of automated processing of personal data intended to indicate personal preferences. It is well documented that profiling benefits consumers as they receive relevant and targeted marketing communications

Consent (legitimate interest) – This proposal would severely restrict direct marketing as it would only be possible to be carried out without the consent of the recipient where that person is an existing customer of the marketer and the marketing communication only relates to similar products and services.

Definition of personal data – the Report recognises that not all data is the same and advocates different treatment of anonymous and pseudonymous data but these definitions are too narrow. This does not reflect how data is used in today’s online world. Individual IP addresses would come within the scope of the Regulation, although the Report recognises that IP addresses used by companies should be excluded.

Right to be Forgotten – although the Report allows some concessions, it is still not clear that if a customer requests the removal of all the data the marketer holds on them, that the marketer can retain a small amount of information to ensure that no future marketing is sent to them (i.e. suppression rather than deletion). This needs to be clarified.