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How Data Transfer Laws Slow Down Digital Trade

– Business Daily Africa

A look at national regulations around data and how they can impede free trade

This article states that, while the pandemic has highlighted the importance of the digital economy, there are currently barriers that prevent it from achieving its full potential. Restrictions on data that crosses borders, such as GDPR or localization requirements, limit the ability of free-flowing data.

“As a result, different regimes will enact their own data protection laws and require adherence by the residents of third countries, ending in a “spaghetti bowl” of regulations that will be tough to traverse.”

Data localization requirements mean that the storage and processing of data must occur within the country’s borders. The authors argue that this makes it harder for outside companies to carry out customer identification and money laundering checks, and highlight the example of when these requirements meant Paypal had to suspend its service in Turkey.

Global economies need to identify common principles between their data protection regimes, to enable mutual recognition of different frameworks across the different jurisdictions and eliminate barriers to cross-border data transfers

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