The “Brussels Effect” Has a Real Influence on US Crypto Regulation
European Union leads the way in global cryptocurrency regulation.
Opinion
The right to privacy is enshrined in many legal traditions around the world. In the United States, it is protected by the Fourth Amendment; in the European Union, it falls under Article 8 of the European Convention on Human Rights. Although definitions differ from jurisdiction to jurisdiction, most of us are entitled to a reasonable expectation of privacy in our correspondence, in our homes and about our persons.
In the 1970s, businesses, families, and individuals began to generate data like never before, and the extent to which it fell within existing privacy mandates was increasingly unclear. This data proliferation was first recognized as a problem in the late 1970s and accelerated in the decade that followed. In response, the EU introduced its Data Protection Directive in 1995, guaranteeing certain fundamental rights regarding the processing of personal data.
The crucial thing to understand in this context is that an EU directive leaves it up to member states to determine how it will be incorporated into national laws. This is a recommendation, not a rule that would legally bind members to enforce the laws from a specific date.
From 1995, privacy regulation in the EU took a well-trodden path. First a guideline, it eventually became the General Data Protection Regulation (GDPR), which became a legal requirement in 2018.
Related: Biden's cryptocurrency framework is a step in the right direction
The GDPR has become the benchmark for privacy legislation and has influenced regulation in other jurisdictions, including the United States. It's a phenomenon that Anu Bradford coined the "Brussels effect", where EU law sets the global regulatory standard. We've seen it happen in a number of areas other than data privacy, such as environmental law and online hate speech, which often enter the United States through a similar mechanism: "California Effect", whereby Californ...
European Union leads the way in global cryptocurrency regulation.
Opinion
The right to privacy is enshrined in many legal traditions around the world. In the United States, it is protected by the Fourth Amendment; in the European Union, it falls under Article 8 of the European Convention on Human Rights. Although definitions differ from jurisdiction to jurisdiction, most of us are entitled to a reasonable expectation of privacy in our correspondence, in our homes and about our persons.
In the 1970s, businesses, families, and individuals began to generate data like never before, and the extent to which it fell within existing privacy mandates was increasingly unclear. This data proliferation was first recognized as a problem in the late 1970s and accelerated in the decade that followed. In response, the EU introduced its Data Protection Directive in 1995, guaranteeing certain fundamental rights regarding the processing of personal data.
The crucial thing to understand in this context is that an EU directive leaves it up to member states to determine how it will be incorporated into national laws. This is a recommendation, not a rule that would legally bind members to enforce the laws from a specific date.
From 1995, privacy regulation in the EU took a well-trodden path. First a guideline, it eventually became the General Data Protection Regulation (GDPR), which became a legal requirement in 2018.
Related: Biden's cryptocurrency framework is a step in the right direction
The GDPR has become the benchmark for privacy legislation and has influenced regulation in other jurisdictions, including the United States. It's a phenomenon that Anu Bradford coined the "Brussels effect", where EU law sets the global regulatory standard. We've seen it happen in a number of areas other than data privacy, such as environmental law and online hate speech, which often enter the United States through a similar mechanism: "California Effect", whereby Californ...
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