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On 21st February, Google customers in the UK were informed that Google was updating its Terms of Service from 31 March 2020. As of that date, and in response to the UK leaving the EU, the US arm of Google will become the data controller responsible for UK customer data (previously this role was fulfilled within the EU by Google Ireland).
Reaction to this news among CISOs has varied, but I thought it would be useful to capture some items worth thinking about.
Firstly, will this move of Google see an exodus of customers looking for a local service alternative? Probably not.
For enterprises that are concerned by the US Cloud Act, it’s worth remembering that from a practical point of view the Act requires confirmation that the data subject at the centre of order is a US citizen. Further assessments take place as part of the order, such as whether the request to the cloud provider breaches local law; whether there is an executive agreement in place; whether there are defeating arguments in place against the order; and whether there is a need for a comity analysis by a US court. These steps easily debunk myths that the US Cloud Act simply allows the US to demand access to any information.
For CISOs whose organisations are still in the EU this February, existing GDPR regulations allow you to store and process data in any jurisdiction as long as that data is processed in compliance with the GDPR. For UK CISOs, this may be the root of a concern, as their organisations move outside of broader EU protection over the coming 12 months. There is a 12 month negotiation period during which all EU protections are still afforded to UK citizens, but by the time the clock runs down we will be hoping to see the UK government review and ratify the Data Protection Act 2018 as part of its comprehensive review of all legislation that is impacted by the country’s exit from the EU. This Act was finalised as the UK enactment of the EU GDPR legislation so should provide a lot of reassurances on data protection, but it will still also need to go to the EU for ratification of ‘adequacy approval’ to confirm its equivalency to GDPR to allow for UK-EU and EU-UK data transfers.
The other item UK CISOs will want to watch in the coming year will be the status of a UK – US Privacy Shield framework agreement. Privacy Shield replaced the US Safe Harbor agreement and promises that “HR and non-HR’” data transferred to the US has the same protection as if it is held in an EU jurisdiction. Until now, UK organisations were able to sign up for EU-US Privacy Shield, but as the UK has left the EU this protection will need clarifying over the next few months. Switzerland has its own Privacy Shield agreement with the US and the most obvious model would be for the UK to do likewise.
If Privacy Shield is not a consideration, Standard Contractual Clauses (SCCs) are the fall back for organisations wanting a contractual agreement that covers the fundamentals of data protection. A review of existing contracts to determine which international data transfer agreement is in place is recommended. This is definitely worth preparing for as the average enterprise uses 2,415 distinct cloud services and apps – and there is no way at all that these all have a contract in place, with specified contract clauses which conform to organisational and regulatory data protection policies.
Earlier I asserted that we wouldn’t see an exodus of Google’s UK customer base migrating to local service providers, so what do I think we might see? I believe that without a current market dominance in the productivity segment, we will see very large enterprise G Suite customers in a good position to make demands about where their own data is held, even if these demands fall outside of the normal Google operational model. There are significant flagship G Suite customers in the UK and it may be that they can attain exceptions for their own data residency.
For those G Suite customers who are not so powerful, but are still uncomfortable with their data potentially sitting within the US jurisdiction, I think the EUUG is a fascinating model to consider. EUUG is the European User Group for Enterprise and Cloud Data Protection, and it was formed initially to give some of Europe’s financial institutions unionised empowerment in negotiations with Microsoft. UK CISOs can perhaps take heart from the naming of this group and the fact that they are still in Europe even if they are no longer in the EU.
In the future, perhaps distrust around international data protection will see more organisational coalitions formed, with cloud customers creating groups of organisations that can resist unilateral decisions around data residency and jurisdiction.
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