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TRUSTe, which sponsors a Web site privacy seal program, announced Wednesday the launch of the new “EU Safe Harbor Privacy Seal” to coincide with the launch of the controversial data-sharing agreement hammered out earlier this year between the U.S. and the 15-nation European Union. Beginning Wednesday, U.S. companies that transfer personal data about EU citizens out of Europe can apply for a spot on a “safe harbor” list maintained by the U.S. Department of Commerce. Entering the safe harbor will immunize the companies from complying with the EU’s Data Protection Directive, a set of stringent data privacy protections that went into effect in Europe two years ago. The San Jose, Calif.-based TRUSTe, which licenses its existing privacy seal to some 2,000 Web sites around the world, is launching the new safe harbor seal to “globalize privacy protection and alternative dispute resolution,” according to the company’s statement. Short of negotiating directly with European authorities, or physically processing relevant information only within EU borders, American companies will have no choice but to subscribe to the safe harbor, lest they risk losing remote access to data about European customers, employees or business partners. Companies entering the safe harbor agree to provide notices about data use, a choice regarding some data transfers, and reasonable access to data and data security. The Federal Trade Commission has been named the safe harbor enforcer. But TRUSTe is aiming to also certify safe harbor compliance and provide an alternative dispute-resolution process that encompasses both online and offline privacy problems. “Realizing the promise of the Internet must not come with the risk of privacy loss,” says TRUSTe President Bob Lewin. The launch of the EU safe harbor, which took more than a year to negotiate and is taking effect over some objections in both Europe and the U.S., comes as the U.S. Congress is gearing up to pass some form of broad online privacy legislation next year. Some Europeans argue that the American privacy regime is still too weak to ensure adequate data privacy. U.S. privacy advocates argue that the EU’s more stringent model, which includes national data protection czars and a private right of legal action for EU citizens who fear privacy violations, should be instituted in the U.S. Regardless, American companies subscribing to the arrangement will find themselves in the awkward position of formally promising EU citizens a much higher level of general online data protection than legally mandated for their domestic clients. That could lead some companies to observe the same set of rules for everyone. “Most companies we’re dealing with don’t want to provide different levels of protection for their customers, so they’re looking at changes in their policies,” says Rebecca Whitener, co-founder of Fiderus Strategic Security & Privacy Services. “For many of them, it’s not feasible to try to separate and not comply with one set of principles.” Copyright � 2000 The Industry Standard

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