On January 11, 2024, the Data Act came into force and will be applicable from September 12, 2025.
With the advent of the Internet of Things, more and more everyday devices are connected to the internet and users generate large amounts of data with their use, which companies then use. Let's take the example of a washing machine with a Wi-Fi connection: it could collect data such as which programs are most used; The company could then use the usage dataset to perform an analysis on which programs are most successful and which others they might want to remove from their washing machines.
The process that has been followed in this example would be: the user generates data with its use and shares it with the company (owner of the data), and the company processes that data and gives it meaning (generates value from the data).
This regulation covers the first point of the process: the raw or pre-processed data generated by users. It seeks to balance the relationship between users and data subjects, allowing the user to request the manufacturer to share certain data generated with its use with third parties (e.g., with a repair service of their choice).
The Data Act clarifies who can use the data we generate through our use and under what conditions, as well as encouraging its use in key economic sectors and areas of public interest. To this end, an EU single data market will also be created that will ultimately benefit both the European economy and society at large.
Thus, thanks to this regulation, connected products must be designed and manufactured in a way that allows users to easily and securely access, use and share the data generated. These provisions apply to all raw and pre-processed data generated from the use of a connected product or related service that is readily available to the data subject.
More specifically, the following measures are taken:
Allow consumers to access the data they create, ensuring they can access and share the data with third parties.
Create fair, reasonable and non-discriminatory conditions for data exchange between companies. As an incentive for data sharing, data subjects who are required to share can request "reasonable compensation."
Public sector bodies will be able to access and use data held by the private sector, and use it to help respond to public emergencies or to comply with a legal mandate and the required data is not otherwise available.
A framework for customers to switch between different cloud data service providers, in order to unlock the EU cloud data market.
Protect SMEs against unfair practices by establishing a non-exhaustive list of terms that are always considered unfair and terms that are presumed to be unfair.
Clear rules on the permissible use of data and the conditions of its sharing. The Commission will also develop model contractual clauses to assist market participants in developing and negotiating fair data-sharing contracts.
A revision of certain aspects of the Database Directive, to ensure a balance between the interests of data subjects and users.
This Act is a key pillar of the European Data Strategy, and will be a significant contribution to the Digital Decade's goal of advancing digital transformation, complementing the Data Governance Act, applicable since September 2023, which seeks to increase trust in voluntary data sharing.