The European Commission has presented the Data Act. The proposal forces organizations to share data with customers, competitors and governments.
The world’s largest organizations develop the most used products. The most used products produce the most data. Data makes it possible to develop even better products, find opportunities and make money. Hence, the world’s largest organizations enjoy a position of privilege. The European Commission wants to level the playing field. The new Data Act proposes that organizations can be forced to share data with governments, competitors and customers.
Do we need a Data Act?
When a machine breaks down in a manufacturing company, a repairing service can depend on data to fix the machine. The data is often owned by the machine’s manufacturer. The manufacturer is not obliged to share the data with others. Hence, only the manufacturer can repair the machine. This greatly impacts the customer, because even when an alternative repair service is way cheaper, it’s impossible to choose an alternative.
The Data Act can force the manufacturer to share data with an alternative repair service. The same applies to cloud providers: they can be forced to share customer data with other providers when a customer wants to make the switch.
If the bill becomes a reality, organizations lose the right to define data generated by sold products as their property. Data must be stored in open formats to be easily shared with others upon request.
Update | The Data Act has been greenlit. It’s no longer a bill, but official regulation. The rules were confirmed on 23 June 2022. Companies have 15 months to prepare. The new rules take effect in September 2023.
Governments can claim data as well
Remarkably, the Data Act emphasizes that governments gain more control over the organizations’ data. The bill states that organizations can be required to share data with a government in case of urgency. Urgency doesn’t just entail natural disasters or crises such as COVID-19, but the enforcement of regulations as well.
We’re not there yet
Every European legislative proposal, including the Data Act, is examined by the European Council and the European Parliament. Legislative proposals must be agreed upon by a majority of the Council and Parliament. Most proposals are repeatedly amended before being finalized. The current version of the Data Act may differ drastically from the final result.