The European Commission has the power to determine, on the basis of article 45 of Regulation (EU) 2016/679 whether a country outside the EU offers an adequate level of data protection, whether by its domestic legislation or of the international commitments it has entered into.
The adoption of an adequacy decision involves
- a proposal from the European Commission
- an opinion of the of the European Data Protection Board
- an approval from representatives of EU countries
- the adoption of the decision by the European Commissioners
At any time, the European Parliament and the Council may request the European Commission to maintain, amend or withdraw the adequacy decision on the grounds that its act exceeds the implementing powers provided for in the regulation.
The effect of such a decision is that personal data can flow from the EU (and Norway, Liechtenstein and Iceland) to that third country without any further safeguard being necessary. In others words, transfers to the country in question will be assimilated to intra-EU transmissions of data.
The European Commission has so far recognised Andorra, Argentina, Canada (commercial organisations), Faroe Islands, Guernsey, Israel, Isle of Man, Jersey, New Zealand, Switzerland, Uruguay and the United States of America (limited to the Privacy Shield framework) as providing adequate protection.
Adequacy talks are ongoing with South Korea. The adoption procedure of the adequacy decision concerning Japan was launched on 5 September 2018.
These adequacy decisions do not cover data exchanges in the law enforcement sector which are governed by the "Police Directive" (article 36 of Directive (EU) 2016/680).
For special arrangements concerning exchanges of data in this field, see the PNR (Passenger Name Record) and TFTP (Terrorist Financing Tracking Programme) agreements.