EU reaches agreement with US over data privacy

A long-running dispute between Europe and the US over data privacy law is drawing to a close.

The US Commerce Department has announced an agreement with the EU over the transfer of personal data from Europe - although the European paliament has yet to ratify it.

EU member states have approved an agreement dubbed "safe harbour". It will allow international organisations to transfer personal data to the US while complying with EU data protection laws. The agreement is not expected to come into force until October this year.

The deal has been under discussion for over two years. It was developed in response to the European Data Privacy Directive, which prohibits the transfer of personal data to non-EU countries that do not meet the EU's standards for privacy protection.

A US government spokeswoman said European governments had been concerned about which US government agency would act as enforcer in the event of a breach of privacy. It has now been agreed that that agency responsible will be the Federal Trade Commission, the spokeswoman said.

Although the agreement will only be voluntary, most US multinationals are expected to sign up to it.