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The Cost of Data Inadequacy: The economic impacts of the UK failing to secure EU data adequacy

23 November 2020

Report with the New Economics Foundation

Image of a woman using a touchscreen ipad to complete a payment transaction at a rustic looking coffeeshop

The Cost of Data Inadequacy: The economic impacts of the UK failing to secure an EU data adequacy decision
UCL European Institute report with the New Economics Foundation


Authors

  • Oliver Patel - Research Associate, UCL European Institute
  • Duncan McCann - Senior Researcher, New Economics Foundation
  • Javier Ruiz - Digital Policy Consultant, independent

Download Report (pdf)

Overview

Following the end of the Brexit transition period on 31 December 2020, the legal basis for transferring personal data across the Channel fundamentally changes. Unless the UK receives an adequacy decision from the EU, businesses and other organisations will no longer be able to freely transfer data from the EU to the UK, without putting in place their own additional measures. These measures can be costly, bureaucratic, and time-consuming to implement.

Although the UK has high standards of data protection via the Data Protection Act 2018, which enacted the General Data Protection Regulation (GDPR) in UK law, an EU adequacy decision is not guaranteed. Potential EU concerns with UK national security, surveillance and human rights frameworks, as well as a future trade deal with the US, render adequacy uncertain. Furthermore, EU-UK data flows are at the whim of the wider Brexit process and negotiations.

This landmark report outlines the economic cost and implications of the UK not receiving an adequacy decision from the EU. We look at the impact on businesses, different economic sectors, and the wider economy. We believe that this is the first comprehensive report analysing this issue from an economic perspective.

Through extensive interviews with over sixty legal professionals, data protection officers, business representatives, and academics, from both the UK and EU, we found that the risk of the UK failing to secure an adequacy decision is both real and serious, and that the impacts would be complex, leading to significant uncertainty. 
 

Report coverage in the media:

The Guardian - UK should not sign EU Deal at any price, says Sunak
The Telegraph - 
British companies risk billions in new costs if EU blocks data sharing deal 
Euractiv - UK firms face hefty compliance costs without EU data deal, report warns
ZDNet Keeping data flowing could soon cost billions, businesses warned
Yahoo News - British firms could face £1.6bn hit if no-deal Brexit limits UK-EU data flows
TechCrunch - Brexit's data compliance burden could cost UK firms up to £1.6bn, says think tank
Daily Express - British companies to lose BILLIONS in legal fees post-Brexit if EU blocks data laws deal
Diginomica - The high price of Brexit - the £1.6 billion cost of the UK not securing a data adequacy deal with the EU (and it impacts US firms as well)
Global Data Review UK companies could pay billions if adequacy not secured

Download Report (pdf)