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After long, drawn-out negotiations, an agreement was finally signed, on June 28, 2010, granting the US access to the SWIFT database. This agreement between Brussels and Washington is meant to help combat terrorism by making it easier to follow the financial trail left by suspected terrorists.

This deal was so hard to reach because of concerns by EU lawmakers that sharing data on bank transfers could violate the privacy of EU citizens.  The long and intense negotiations were finally brought to a successful close after the US made substantial concessions. The agreement, which was signed by the Spanish Commissioner for Home Affairs (because Spain had the presidency of the EU for a few more days, until July 1, 2010), and the US Embassy’s Economic Officer to the EU, still needs to be ratified by the EU Parliament.  The Parliament is expected to give its blessing to the deal, in a July plenary session, since key MEPs from the three main political groups–the centre-right European People’s Party, the Socialists and the Liberals—seem satisfied with the US concessions.

The agreement allows the US Treasury Department to receive EU financial data from the Society for Worldwide Interbank Financial Telecommunications (SWIFT), which is a messaging network, headquartered in Belgium, used by banks and financial institutions worldwide. The information will be used to investigate, find, identify and prosecute alleged terrorists and their financiers.

One of the important aspects of the agreement is the involvement of Europol, the EU’s agency for police cooperation. Europol will scrutinize the data requests from the US and supervise the data transfers to ensure that they comply with the privacy safeguards. Also, only searches on specific, identified terrorist leads can be conducted; no “fishing expeditions” in the database will be allowed. Additionally, an EU watchdog will be appointed to supervise the US’ extraction of the encrypted data from the SWIFT servers.  A sunset clause has also been included in the agreement which provides that if the EU has not set up its own system for safeguarding privacy within 5 years, this agreement will not be renewed.