Tech Industry Asks Congress to Press for Trade Barrier Relief

Tech allies are wary of some nations' privacy endeavors and data localization, and Congress can play a role, a House Digital Trade Subcommittee heard Thursday. Keeping data flowing across borders benefits jobs and economic growth, tech industry officials testified, as expected (see 1710110045). Officials pressed lawmakers to pursue favorable digital trade policies and urge the administration to work with governments on North American Free Trade Agreement negotiations. Chairman Bob Latta, R-Ohio, said the hearing is a “jumping-off point for a closer examination” of non-tariff trade issues in months to come. “Congress can play a significant role in supporting the people and businesses that depend on the free and open flow of data,” Latta said. He criticized actions some U.S. trading partners took to restrict cross-border data flows through requirements to localize data storage, production and facilities, raising costs for U.S. businesses. Such restrictions are “counterproductive to data security and privacy,” said ranking member Jan Schakowsky, D-Ill. Differences among countries “create challenges,” she said. The U.S. should balance between constructing policies that remove harmful barriers and those protecting privacy and security where “current law is lacking,” Schakowsky said, citing Equifax's breach and urging Congress to compel more answers (see 1710120016). Data flow across borders is a big, new policy concern, said BSA|The Software Alliance CEO Victoria Espinel. “NAFTA is a good place to start,” she said, urging the administration to work broadly with countries around the world to “set ground rules on international data.” Information Technology Industry Council President Dean Garfield said Congress can provide the “kinds of oversight and support” to create policies supporting growth in the sector. He cited a recent Information Technology and Innovation Foundation study that said EU states "differ significantly" on how much they used data to illustrate the uneven perspectives among trading partners. Requiring some data be stored locally is counterproductive to open borders, and harmful to companies that can’t afford the costs, ACT|The App Association President Morgan Reed said. “Companies will opt out of global opportunities if there are restrictions.” Reed praised the Privacy Shield framework (see 1709210011) as a workable cross-border policy, saying his members “have undertaken significant effort” to comply.