Privacy Shield Program: What It Means for Your Business

By SecYork Technology

In today’s digital age, data privacy and international data transfers are more important than ever. Companies operating across borders—especially between the U.S. and Europe—face increasing scrutiny over how they handle personal data. That’s where the Privacy Shield Program once stepped in.

But what exactly was the Privacy Shield, why was it invalidated, and what does that mean for your organization today?

What Was the Privacy Shield Program?

The EU-U.S. and Swiss-U.S. Privacy Shield Frameworks were agreements designed to facilitate transatlantic data transfers while ensuring compliance with European data protection laws, specifically the General Data Protection Regulation (GDPR).

Launched in 2016 by the U.S. Department of Commerce and the European Commission, the program allowed U.S. companies to self-certify that they complied with strict privacy principles around:

• Notice and choice

• Data integrity and purpose limitation

• Access and recourse

• Security and enforcement

By participating in the Privacy Shield, companies could legally transfer EU citizens’ personal data to the U.S., without the need for additional safeguards like Standard Contractual Clauses (SCCs).

Why Was the Privacy Shield Invalidated?

In July 2020, the Court of Justice of the European Union (CJEU) ruled the Privacy Shield invalid in the Schrems II case. The court found that:

• U.S. surveillance practices (e.g., under FISA 702 and Executive Order 12333) did not provide sufficient protection for EU citizens' data.

• EU citizens had limited legal recourse against misuse or surveillance by U.S. intelligence agencies.

As a result, Privacy Shield was no longer a valid mechanism for GDPR-compliant data transfers.

What Replaced the Privacy Shield?

In 2023, the U.S. and EU introduced a new agreement called the EU-U.S. Data Privacy Framework (DPF). This framework aims to address the shortcomings of Privacy Shield by:

• Creating a more independent Data Protection Review Court.

• Placing stronger limits and oversight on U.S. intelligence agencies.

• Strengthening commitments from U.S. companies to protect EU data.

U.S. businesses that were previously Privacy Shield-certified have been encouraged to transition to the new Data Privacy Framework.

What Does This Mean for Your Business?

If your company handles data from EU or Swiss citizens, you must ensure your data transfers are GDPR-compliant. Here's how SecYork recommends you move forward:

1. Review Your Data Transfer Mechanisms

• Use Standard Contractual Clauses (SCCs) or the new EU-U.S. Data Privacy Framework.

• Avoid relying on the now-invalidated Privacy Shield alone.

2. Update Privacy Policies and Vendor Agreements

• Make sure your public privacy policy reflects your current compliance method.

• Confirm third-party vendors also follow proper data transfer protocols.

3. Monitor Regulatory Developments

• The data privacy landscape is rapidly evolving. Work with a cybersecurity and legal team to stay compliant with changing laws.

4. Conduct a Data Protection Impact Assessment (DPIA)

• Especially if you're processing sensitive or large volumes of EU data.

Final Thoughts from SecYork

Data privacy is not just a compliance checkbox—it’s a foundation of customer trust and international credibility. With the Privacy Shield now defunct, organizations must adopt updated, lawful mechanisms for handling global data transfers.

At SecYork Technology, we help businesses navigate data protection regulations like GDPR, the Data Privacy Framework, and other global standards. From compliance assessments to privacy policy development, we’re here to ensure your data flows are secure, lawful, and future-proof.

Need help with GDPR compliance or cross-border data transfer security?Contact SecYork today for a free consultation with one of our privacy and security experts.