Europe will resume sending details of private bank transaction to the US on 1 August following the European Parliament's ratification of a revised deal on the processing and transfer of financial messaging data for the US's Terrorist Finance Tracking Program (TFTP).
The White House welcomed the move, saying it restored an "important counterterrorism tool" and protected the US and Europe against terrorists.
The deal contains improved data privacy safeguards compared to the wholesale supply of bank account details from the Swift international interbank communications system.
However, European Data Protection Supervisor Peter Hustinx said the changes were insufficent and hoped that "the gaps will be eliminated in the coming years".
Hustinx earlier called for a prohibition of the transfer of bulk data, for shorter storage times, for a court to review US Treasury requests for data, for the effective enforcement in the US of citizens' data privacy rights, and enhanced independent oversight of the scheme, the European Parliament said in a statement.
Instead of allowing bulk data transfer, MEPs agreed to set up a European equivalent of the TFTP within a year. This meant it would need transfer only data that related to a specific terrorist track.
Europol, the EU's criminal intelligence agency, would be allowed to block data transfers to the US. "Europol will have to check that every data transfer request by the US Treasury is justified by counter-terrorism needs and that the volume of data requested is as small as possible," the European Parliament said.
The agreement now allows the US to use the data exclusively for counter-terrorism purposes. The EU would appoint someone to monitor this use, and to a question a data request and to block any they deemed illegitimate.
"The agreement prohibits the US from data mining or any other type of algorithmic or automated profiling or computer filtering," the statement said. "Any searches of Swift data will have to be based on existing information [that shows] that the object of the search relates to terrorism or terrorism finance."
The agreement also requires the US to provide a judicial right of redress, regardless of nationality, equivalent to those applied to data held in the EU.
The White House said protecting privacy and civil liberties was a top priority of the Obama administration.
It said the TFTP had provided more than 1,550 investigative leads to EU member states since its creation after the 9/11 attacks. It said these leads had prevented of helped investigations into attacks in Bali (2002), Madrid (2004), London (2005), the shoe bomb plot (2006), New York's John F. Kennedy airport (2007), Germany (2007), Mumbai (2008), and Jakarta (2009).