Israel will become just the seventh country to have its data protection laws approved by the European Union. The approval means that companies can transfer personal data to that country freely, without breaking EU law.
Uruguay's application for the same treatment has been backed by a technical committee but still requires political approval before making it on to the list of approved nations.
The Data Protection Directive generally prevents personal data being sent outside of the European Economic Area – except to countries whose data protection regimes are deemed to give "adequate" protection, unless the transfer can be justified by other means.
A European Commission list of countries (54-page / 349KB PDF) deemed to be adequate consists of Switzerland, Argentina, the Bailiwick of Guernsey, the Isle of Man, the Bailiwick of Jersey and Canada, as long as the recipient of the information is subject to the Canadian Personal Information Protection and Electronic Documents Act.
Data can also be transferred to the US if the organisation receiving the material subscribes to the US Department of Commerce's Safe Harbor Privacy Principles.
Israel will join the approved list in a month. Though the European Parliament has a month to scrutinise the decision, it cannot change it, a European Commission spokeswoman said.
"The draft Commission Decision on the adequate protection of personal data in the State of Israel has been adopted on 25 October in the comitology procedure (so called Article 31 Committee)," said the spokeswoman. "The European Parliament has one month of scrutiny. Its opinion is however not binding for the Commission."
"So after the expiry of the scrutiny period, the Commission decision is adopted via the normal written procedure. The adequacy of Israel should therefore be formally approved by the end of the year," she said.
Israel's inclusion on the list was opposed by Ireland in the aftermath of the use of eight Irish passports in an assassination carried out in Dubai. Israeli secret service Mossad was widely alleged to have been behind the action.
The Article 29 Working Party, which is made up of data protection watchdogs from the EU's 27 member states, has separately approved Uruguay's application (20-page / 85KB PDF) to join the list of nations with adequate data proteciton regimes.
That application was made in 2008 but the Working Party has only now approved the country's laws, following the commissioning of an academic report into its legislation.
Countries that outsource work which demands the transfer of personal data to countries outside of the EU must ensure that the material is protected.
If that country is not in the short list of "adequate" countries, then companies must use specially-drafted "model clauses" created by the EU in their contracts with companies. Failing that, they can use "binding corporate rules" to ensure that the data is protected.
Copyright © 2010, OUT-LAW.com
OUT-LAW.COM is part of international law firm Pinsent Masons.