U.S. Official Warns of Localizing EU Data Without Transfer Pact (1)

A Commerce Department official warned U.S. senators about the risks of forcing companies that collect data on European Union citizens to keep that data inside the bloc if a now-defunct privacy pact for transatlantic transfers isn’t replaced.

So-called data localization is “a very significant concern for us,” James Sullivan, deputy assistant secretary for services at the department’s International Trade Administration told the Senate’s Commerce Committee at a hearing Wednesday.

Without a privacy pact in place, companies facing hefty fines from European regulators could turn to data localization as a solution.

Under data localization, data collected on Europeans would need to ...