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Growing focus on privacy in Asia

Trans-Atlantic data flow has been the focus of much attention for the past several years. Eye-catching court cases, the shift from Safe Harbor to Privacy Shield, and the imminent GDPR implementation have all served to draw the concentration of the privacy community. One would almost think that privacy is entirely concentrated between the U.S. and Europe.

However, a new privacy framework has been quietly gaining steam in Asia. As trade has increasingly included the flow of data, the Asia-Pacific Economic Cooperation has implemented its own Cross Border Privacy Rules (CBPR) framework to demonstrate adequate data protection standards and the world is taking notice.

The framework creates a critical safeguard in global trade. Digital global data flows are increasing global GDP (by at least 10 percent in 2013 alone) and the importance of protecting the information in those data flows is increasing as well. This global expansion leads to specific concerns for consumers on one side and companies and governments on the other. Consumers need to know that they can trust companies and governments with their data. Companies and governments need a way to show consumers that they are trustworthy. Into this gap steps privacy frameworks, like Privacy Shield in Europe and the current APEC CBPR framework in Asia.

President Obama directly recognized the importance of these privacy frameworks in an address at APEC 2016 in Lima, Peru. Four out of the U.S.’s five top trading partners are APEC members, making it likely that secure data transmission and processing will continue to be a priority for future administrations.

Within the U.S., the Federal Trade Commission recently displayed how seriously it will take the framework by bringing an enforcement action against VipVape for improperly claiming CBPR certification.

The growth of the APEC CBPR framework in the past year, through Japan becoming a full member of the framework and revisions to make the framework more streamlined, reflects cross-border privacy’s growth from a primarily US/EU concern to a global concern. APEC’s member economies represented approximately 59 percent of the world GDP and 49 percent of world trade in 2015. Though only Japan, the U.S., Mexico, and Canada have currently joined the CBPR system, a recent report that surveyed APEC member countries showed high prospective growth: Korea, Singapore, and the Philippines “plan to join,” while Australia, Hong Kong, Russia, Taiwan, and Vietnam are “considering” joining. On an individual company level, those that have been through the CBPR certification process include giants like Apple, HP, IBM, and Merck.

Government, business, and regulator stakeholders in APEC economies have identified several benefits of the growing CBPR framework. Government stakeholders pointed to the program’s potential to grow global trade and to benefit economic growth policy objectives by providing a trusted environment for the trade to take place. Business stakeholders emphasized the value of moving toward one global compliance system. They also claimed that CBPR certification lowered the time and cost of implementing EU binding corporate rules thanks to the level of interoperability between the two systems. Regulatory stakeholders reported that the framework allows regulators to reallocate resources and efforts if the regulators know that accountability agents within the CBPR system are effectively monitoring compliance. The efforts of major companies to certify, the membership and pending membership of so many APEC countries, and the active interest of stakeholders in the framework are all reflections of the growing prominence of the CBPR program.

Within the U.S., the Federal Trade Commission recently displayed how seriously it will take the framework by bringing an enforcement action against VipVape for improperly claiming CBPR certification. The Commission followed up on this action by sending warning letters to several other companies falsely claiming the certification. The IAPP FTC Casebook covers the VipVape enforcement and examines the connection between this enforcement action and past actions relating to Safe Harbor claims. The similarities in these enforcement actions point to parallels between how the U.S. has historically treated E.U. privacy frameworks and how it plans to treat the APEC CBPR privacy framework.

In response to the continued growth and prominence of the APEC CBPR framework and the growing shift in global data flows to include Asia more and more, the IAPP is also offering more resources to those privacy professionals who interact with Asia and the privacy regulations in the region. The new Certified Information Privacy Professional Asia designation will be offered for testing in February. This credential demonstrates expertise with the regulations and data privacy laws in the region with particular focus on Hong Kong, Singapore, and India. In addition, this spring’s Global Privacy Summit will offer a panel specifically addressing recent developments in APEC regulations and future growth, and the IAPP Asia Privacy Forum will return to Singapore this summer.

Written By

Calli Schroeder, CIPM, CIPP/US

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