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The European Union’s top court ruled Thursday that an agreement that allows thousands of companies — from tech giants to small financial firms — to transfer data to the United States is invalid because the American government can snoop on people’s data.
The ruling to invalidate Privacy Shield will complicate business for some 5,000 companies, and it could require regulators to vet any new data transfers to make sure Europeans’ personal information remains protected according to the EU’s stringent standards.
It will no longer simply be assumed that tech companies like Facebook will adequately protect the privacy of its European users’ data when it sends it to the U.S. Rather, the EU and U.S. will likely have to find a new agreement that guarantees that Europeans’ data is afforded the same privacy protection in the U.S. as it is in the EU.
Privacy activists hailed the court ruling as a major victory, while business groups worried about the potential to disrupt commerce, depending on how the ruling is implemented. Companies like Facebook routinely move such data among their servers around the world and the practice underpins billions of dollars in business.  
“It is clear that the U.S. will have to seriously change their surveillance laws, if U.S. companies want to continue to play a major role on the EU market,” said Max Schrems, an Austrian activist whose complaints about the handling of his Facebook data triggered the ruling after years of legal procedures.
He first filed a complaint in 2013, after former U.S. National Security Agency contractor Edward Snowden revealed that the American government was snooping on people’s online data and communications. The revelations included detail on how Facebook gave U.S. security agencies access to the personal data of Europeans.
Though the legal case was triggered by concerns over Facebook in particular, it could have far-reaching implications not only for tech companies but also businesses in sectors like finance and the auto industry.  
Things like email, flight and hotel reservations would not be affected in the short term, experts say. Cloud services by providers like Microsoft will also continue, pending any intervention from a regulator.
Companies use legal mechanisms called standard contractual clauses that force businesses to abide by strict EU privacy standards when transferring messages, photos and other information. The clauses — which are stock terms and conditions — are used to ensure the EU rules are maintained when data leaves the bloc.
The Court of Justice of the EU ruled Thursday that those clauses are still valid in principle. However, it declared invalid the Privacy Shield agreement between the U.S. and EU on data transfers over concerns that the U.S. can demand access to consumer data for national security reasons.
It said that in cases where there are concerns about data privacy, EU regulators should vet, and if needed block, the transfer of data. That raises the prospect that EU regulators will block Facebook, for example, from transferring any more European data to the U.S.
The court noted in its ruling that there are “limitations on the protection of personal data arising from the domestic law of the United States on the access and use by U.S. public authorities of such data transferred from the European Union to that third country.”
Government surveillance of personal data is something the U.S. in its turn accuses China of doing through tech companies  like Huawei. It highlights the growing importance of data as the basis of modern business and politics globally.  
Data drives much of the world’s biggest companies, like Facebook, Google, Alibaba and Amazon, and is also prized for national security to prevent extremist attacks, for example. Mining large sets of people’s data has also become crucial to winning elections, such as the use of Facebook data for Donald Trump’s presidential victory in 2016.
Alexandre Roure, a senior manager at Computer & Communications Industry Association, said the decision “creates legal uncertainty for the thousands of large and small companies on both sides of the Atlantic that rely on Privacy Shield for their daily commercial data transfers.  
“We trust that EU and U.S. decision-makers will swiftly develop a sustainable solution, in line with EU law, to ensure the continuation of data flows which underpins the trans-Atlantic economy.” 
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Global financial markets are in freefall Thursday, despite China’s economic rebound in the second quarter of this year.   In Europe, both the FTSE in London and the DAX index in Frankfurt are down 0.6% in late afternoon trading, while Paris’s CAC-40 index is 0.8% lower. The big selloff began earlier Thursday in Asia, with the Nikkei finishing the day 0.7%.  The Hang Seng in Hong Kong dropped 2%, while Shanghai’s Composite index lost a staggering 4.5%. Sydney’s S&P/ASX index fell 0.6%.  Seoul’s KOSPI index closed 0.8% lower, and the TSEC in Taipei ended down 0.3%.  Mumbai’s Sensex is trading one percent higher in late afternoon trading. In other market news, U.S. crude oil is selling at $40.75 per barrel, down one percent, while Brent crude is selling at $43.50 per barrel, down 0.6%.China revealed Thursday that its economy grew 3.2% in the period between April and June compared to the previous year, but that good news was tempered by worse-than-expected data on domestic retail sales.  The growing tensions between the United States and China also contributed to investors’ nervousness about a post-pandemic recovery. In futures trading, all three major U.S. indices were trending downward hours ahead of Thursday’s opening bell on Wall Street.   
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A little-known nonprofit organization backed by the U.S. government has become the center of a maelstrom as the Trump administration changes its leadership.The Open Technology Fund, an independent, private nonprofit corporation, receives funding from the U.S. Agency for Global Media (USAGM), the agency that oversees Voice of America. Since its founding in 2012, OTF has helped fund some of the most important digital tools available to dissidents, activists and others as repressive governments worldwide beef up their ability to surveil and block their own citizens.But the future of the organization, which has a 2020 annual budget of about $21 million, may be at stake, according to digital rights groups worldwide.A change of leadership at USAGM that removed its chief executive, president and board threatens to upend the organization that rights groups say has become the backbone of the internet freedom community. They fear a new OTF will move away from supporting “open-source” projects — apps, software and technology made with code that all can see and test — and instead turn to “closed-source” technologies, making it harder for activists, journalists and others to know whether they can trust it.In June, Michael Pack, the new chief executive of USAGM, fired several of the heads of organizations that report to him. Pack removed Libby Liu, the chief executive and co-founder of OTF, and Laura Cunningham, the president of the corporation, and replaced the OTF board. Funding was frozen during the restructure.Four former board members, including two former U.S. ambassadors, attempted to block the changes via a lawsuit against USAGM, but the suit was denied by a federal judge. They are appealing that decision.More than 500 organizations, including the digital rights group Electronic Frontier Foundation and Mozilla, the maker of the Firefox internet browser, have signed a petition asking the U.S. Congress to look at recent changes at OTF.“There are serious concerns that the new leadership within the USAGM will seek to dismantle OTF and re-allocate all of its U.S. government funding to support a narrow set of anti-censorship tools without a transparent and open review process,” the petition reads.USAGM declined multiple requests for comment.A tech arms raceOTF was created as a program in Radio Free Asia to finance early-stage digital tools, before becoming an independent nonprofit corporation in September 2019. In addition to the $21 million annual grant from USAGM, OTF also receives private funds.Digital rights groups, activists and tech startups can apply for funding for projects via OTF’s website. For example, more than 50 organizations received money from its Internet Freedom Fund, which awards contracts between $50,000 and $200,000.In addition to providing rapid-response funding for activists facing immediate censorship threats, OTF trains people worldwide on digital safety, sponsors yearlong fellowships, runs several laboratories on technology, legal and other internet freedom areas, performs security audits of technology tools, and translates new apps and software into more than 200 languages.Some of OTF’s awardees are among the most widely used technologies among dissidents and activists. Between 2013 and 2016, OTF awarded more than $3 million to help fund Signal technology, which provides end-to-end encryption for communications. The same technology is now part of the foundation of WhatsApp, the Facebook messaging app.During the same time frame, OTF awarded $3 million to Tor, which allows people to anonymously access news and information blocked by their governments.Other projects included Let’s Encrypt, which allows organizations and small businesses to protect websites against hackers and cyber criminals, and WireGuard, a virtual private network (VPN) code that closed vulnerabilities that could be exploited by repressive regimes, according to technologists.Question of ScaleOTF is not without its critics. Competing visions both inside and outside of the organization, including on what OTF should be doing, predate the arrival of Pack and the new leadership team.These include whether it should focus on financing circumvention tools that help USAGM’s TV, radio and digital programming and news circumvent government firewalls to reach more than 300 million people worldwide, a mission some argue is aligned with a federally funded international broadcast agency. Or whether OTF should continue handing out financial grants to people building anti-surveillance tools to help activists on the ground communicate and evade government detection.While OTF has accomplished a lot, it can do more, said Katrina Lantos Swett, president of the Lantos Foundation, a human rights organization named after her father, Rep. Tom Lantos, a Democrat from California. She is also a past chair of the U.S. Commission on International Religious Freedom.“We believe there is a potential to bring down the Great Firewalls, writ large, and that we should also be funding large-scale circumvention tools with the ability to free vast numbers of people from what are, essentially, digital prisons,” Lantos Swett said. “It’s not an either/or scenario – open-source versus circumvention tools – but I believe a little bit of funding for the latter could yield tremendous results. China is spending hundreds of millions of dollars to shore up its firewall, so we should be willing to spend tens of millions to punch holes in it.”OTF has not previously funded large-scale projects but was looking into it, said people familiar with its operations. An additional issue, they say, is that some of the circumvention technology that the Lantos Foundation and others are promoting come with “closed-source technology,” which makes it harder for people to audit, test and trust.Chris Riley, director of government relations at Mozilla and an early advisory council member of OTF, said the group’s promotion of open-sourced technology has been critical.“OTF’s focus on open-source tools and the open-source developer community has been particularly valuable for the security and availability of these tools, for those who most need them,” Riley said. “A change in strategy for OTF away from open source would put significant parts of the secure, open internet, and the human rights and lives that depend on it, at greater risk.”In a July 2 interview with the site RealClearPolitics, Pack declined to discuss OTF but said he is still evaluating OTF’s role and has no plans to dismantle the organization.The interim head of OTF, James Miles, 78, is a former secretary of state of South Carolina. An attorney, Miles practiced labor and employment law but doesn’t appear to have technology or media experience. Miles did not respond to a VOA interview request about his new role.The tools for digital securityFor digital activists, OTF’s turmoil comes at a time when protesters in places such as Hong Kong face new crackdowns and surveillance.There is “an arms race” of digital tools between repressive regimes and dissidents and activists who are operating inside of them, said Bill Marczak, a research fellow at Citizen Lab, which is based at the University of Toronto, and one of the signatories of the petition.“There’s a benefit to make sure people have access to digital security when they need it,” said Marczak, who in 2014 received a one-year fellowship from OTF focusing on technology to detect servers used in hacking attacks.Raphael Mimoun, founder of Horizontal, is currently under contract with OTF for work improving Tella, a free app that encrypts photos, videos and other content on mobile devices.Despite the changes at OTF, Mimoun said he expects the organization will honor his firm’s contract for $53,000.But it’s the future he worries about. The Tella app is available on Android phones but not iPhones, a project that Mimoun might turn to OTF for funding.“In the long run, it will be a disaster if OTF was taken in a direction and hollowed out in what it does so well,” he said.  
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With the number of confirmed COVID-19 cases in the United States nearing 3.5 million and rising, more states, local jurisdictions and businesses are mandating facial coverings for residents and customers.Gov. Kay Ivey of the southern state of Alabama ordered all residents to begin wearing masks effective Thursday, as the state reported nearly 50 new deaths on Wednesday.  Montana Gov. Steve Bullock has imposed mandatory masks at all indoor public settings in counties where four more people have tested positive for COVID-19.The nation’s largest retailer, Walmart, is the latest to require customers to wear masks at all of its more than 5,000 outlet stores, joining the likes of tech giant Apple, coffeehouse chain Starbucks, electronics retailer Best Buy, and discount retailer Costco.But a handful of state leaders have refused to order mandatory face coverings despite an average of more than 60,000 new coronavirus cases per day in the U.S. since early June.  One such governor is Oklahoma’s Kevin Stitt, who announced Wednesday that he had tested positive for the novel coronavirus. Stitt, a Republican, attended President Donald Trump’s campaign rally in Tulsa last month, which health experts believe likely contributed to a spike in COVID-19 cases there.Another governor who has declined to issue a statewide order requiring masks is Ron DeSantis of Florida, which has surpassed 300,000 confirmed cases and where the number of new infections reached a crisis point, as hospitals are near or at full capacity.Florida is one of several states across the southern and western U.S. undergoing a surge of coronavirus infections and deaths, including Arizona, Texas and California.  Organizers of the annual Tournament of Roses Parade, held on New Year’s Day in the southern California city of Pasadena, announced Wednesday that it has canceled the 2021 edition due to the pandemic.With the death toll in the United States now well above 137,000, a new model developed by the Institute for Health Metrics and Evaluation at the University of Washington is now projecting the number of people to die from COVID-19 will reach 224,000 people by November 1, an increase of 16,000 from a prior forecast. 
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A suspected hacking attack caused the site of North Macedonia’s electoral commission to crash for hours after polls closed in national elections Wednesday, delaying preliminary results that showed the pro-Western Social Democrats narrowly leading the center-right opposition. The commission said early Thursday that with nearly 94% of the vote counted the Social Democrats have 36% and VMRO-DPMNE follow at more than 34%. The ethnic Albanian Democratic Union for Integration was third at 11%, while a coalition of two smaller ethnic Albanian parties followed at nearly 9%. The Commission gave no projections on how many seats each party stood to win in the 120-member parliament. Shortly afterwards, Social Democrats leader Zoran Zaev declared victory. Addressing cheering supporters in the capital Skopje, he promised fast reforms to help the country’s European Union accession hopes end revive the battered economy. Electoral commission head Oliver Derkoski said the suspected hack affected the official website designed to give fast online results. Vote counting was proceeding normally as the commission’s central server was not affected, he said. Derkovski added that police have been informed and will investigate the attack and who might be behind it. Another official told The Associated Press that “an outside hacker attack spread a virus … so the public cannot see the results online.” “Our technical team is working to solve the problem,” he said, speaking on condition of anonymity as he was not authorized to discuss the matter with the media. The election — delayed for months due to the pandemic — was held amid a resurgence of the coronavirus in the small Balkan country, with voters donning obligatory masks. Polling stations closed later than usual to encourage turnout, and authorities also organized two days of advance voting to allow people in quarantine or at greater risk from the virus to cast their ballots from home. North Macedonia, a former Yugoslav republic with a population of around 2 million, reported more than 8,500 cases, including 393 deaths, as of Wednesday, with 198 new cases and four deaths reported over the previous 24 hours. The country saw new cases rise in recent weeks after infection-control restrictions were lifted. Election authorities said turnout had reached 50.8% half an hour before polls closed, which is lower than in previous elections. Zaev’s governing Social Democrats called the early parliamentary election when he resigned as prime minister in January after the European Union failed to give North Macedonia a start date for EU membership talks. Zaev faced a strong challenge from VMRO’s Hristijan Mickoski. The party has softened its earlier opposition to a landmark 2018 deal with Greece that saw the country change its name from Macedonia to North Macedonia, clearing objections for it to join NATO earlier this year. Zaev, 45, ran much of his campaign on the accomplishment of securing the agreement with Greece that ended a dispute of nearly 30 years. “I believe our positive campaign has won over citizens,” Zaev said after voting. North Macedonia has had a caretaker government since his resignation as prime minister in January. Election campaigns were limited by social distancing rules and calmer than in past elections, which produced vitriolic animosity between the two main parties. The Social Democrats have governed since 2016 after beating populist conservative Nikola Gruevski of VMRO-DPMNE, who fled to Hungary to avoid serving a two-year jail sentence for abuse of power and corruption. Gruevski’s successor, Hristijan Mickoski, moved the party toward the center-right but aimed his campaign at voters are still disappointed by the country’s name change. “People are going to the polls in large numbers from what we can see,” Mickoski said. “They are ready for a big change.” If neither party can achieve an outright victory, the winner will most likely have to seek a power-sharing deal with parties representing the country’s large ethnic Albanian minority. The election is being monitored by a team of international observers.  
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President Donald Trump shook up his campaign staff Wednesday amid sinking poll numbers, replacing campaign manager Brad Parscale with veteran GOP operative Bill Stepien.The relationship between Trump and Parscale had been strained since a Tulsa, Oklahoma, rally last month that drew an unexpectedly low crowd, infuriating the president. Trump has been struggling in his reelection campaign against presumptive Democratic presidential nominee Joe Biden as the country faces health and economic crises during a pandemic that has killed more than 135,000 Americans.Trump announced the move on Facebook late Wednesday. “I am pleased to announce that Bill Stepien has been promoted to the role of Trump Campaign Manager,” he said. “Brad Parscale, who has been with me for a very long time and has led our tremendous digital and data strategies, will remain in that role, while being a Senior Advisor to the campaign.”The shakeup injected familiar turmoil to Trump’s 2020 campaign, which had so far largely avoided the regular staff churn that dominated the president’s 2016 campaign and his White House. But the staff change was not expected to alter the day-to-day running of the campaign.FILE – Brad Parscale, then-campaign manager for President Donald Trump, speaks to supporters during a panel discussion, Oct. 15, 2019, in San Antonio.Parscale, a political novice, ran Trump’s digital advertising in 2016 and was credited with helping bring about his surprise victory that year. Stepien has been in politics for years, working for former New Jersey Governor Chris Christie and serving as Trump’s national field director in 2016.Parscale had been increasingly sidelined in the weeks since the Tulsa rally and as the president’s public and private poll numbers have taken a hit amid the coronavirus pandemic. Speculation had been rampant about who might be promoted to lead the operation, with names like former Trump strategist Steve Bannon floated.Parscale is a close ally of Trump son-in-law and White House senior adviser Jared Kushner, who wields ultimate control over the campaign.Trump has been pressed by allies in recent months to expand his political circle and more forcefully define his run against Biden. On Tuesday, he relented to weeks of lobbying by his political advisers, delivering a broadside against the former vice president from the Rose Garden and framing the November election as the starkest choice in the nation’s history.Biden’s changesBiden also shuffled his campaign team amid a disastrous stretch in his campaign, albeit much earlier in the cycle. For Biden, the moves marked genuine shakeups that expanded and changed how his campaign operated.Biden elevated Anita Dunn, effectively displacing his first campaign manager, Greg Schultz, after a fourth-place Iowa finish and after he was already headed for a second embarrassing finish in New Hampshire. Dunn had joined Biden at the outset of his campaign after having served President Barack Obama as a top communications adviser.With Dunn’s urging, Biden hired his current campaign manager, Jen O’Malley Dillon, in March after Dunn and others helped resurrect Biden in Nevada and South Carolina and put him on the path to the nomination. Schultz is now at the Democratic National Committee, helping lead the joint battleground strategy among the national party, the Biden campaign and state parties.
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Several New York City police officers were attacked and injured Wednesday as pro-police and anti-police protesters clashed on the Brooklyn Bridge. At least four officers were hurt, including Chief of Department Terence Monahan, and 37 people were arrested, police said. Information on charges was not immediately available. Surveillance video posted on social media by the police department showed a man on the bridge’s pedestrian walkway rushing toward a group of officers and reaching over a fence to bash their heads with a cane. A Black Lives Matter protester and NYPD officers scuffle on the Brooklyn Bridge during a demonstration, in New York, July 15, 2020.Police photos of the aftermath showed a lieutenant with a bloodied face, a detective holding a bandage to his head, and a bicycle officer helping a fellow officer dress a head wound. Monahan, who last month knelt in a show of solidarity with protesters, sustained injuries to his hand. He and the other injured officers were marching with a pro-police group led by local clergy when they were met on the bridge by anti-police activists, some of whom have been camping outside City Hall in recent weeks to demand severe cuts to police funding. Some people in the pro-police group marched with a banner that said, “We Support the NYPD.” The leader of that group said they were calling for an end to a recent spate of violence, including the shooting death of a 1-year-old boy in Brooklyn. Wednesday’s demonstrations were the latest in a wave of protest activity across the country since George Floyd was killed May 25 by Minneapolis police. The first few nights of protests in New York City were marred by stealing, unrest and violence inflicted both by and on police officers. Since then, protests have largely been peaceful. 
 
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The Trump administration is prepared to terminate a 2013 agreement between U.S. and Chinese auditing authorities in a move aimed at increasing pressure on Chinese-listed companies in the United States to comply with U.S. auditing standards.The Reuters news agency cited Keith Krach, undersecretary for economic growth, energy and the environment at the State Department, who said a lack of transparency has prompted officials to lay the groundwork to exit the 2013 memorandum of understanding.“This is a national security issue because we cannot continue to afford to put American shareholders at risk, to put American companies at a disadvantage and allow our preeminence of being the gold standard for financial markets to erode,” Krach told Reuters.The development follows years of tension between American auditors and Chinese companies over the financial documentation required of companies that list shares on U.S. exchanges, especially the technology-oriented Nasdaq exchange.Legislative responseReuters said termination of the 2013 agreement would not immediately threaten the listed status of those companies. Legislation currently moving through the U.S. Congress, however, eventually could force the delisting of Chinese companies that fail to comply with certain terms of the agreement.Under the agreement, procedures were established for an agency known as the Public Company Accounting Oversight Board (PCAOB) to seek documents in enforcement cases against Chinese auditors. But the PCAOB says it still cannot get the access to audits that it needs to ensure that listed Chinese companies have accurate financial and corporate records.FILE – Tao Sang Tong, center, chairman of Tencent Music Entertainment; Cussion Kar Shun Pang, right, the company’s CEO; and Guomin Xie, its co-president, are pictured at the New York Stock Exchange prior to the Chinese company’s IPO, Dec. 12, 2018.William Duhnke, chairman of the PCAOB, said last week that there had been discussions with his Chinese counterparts on improving oversight of U.S.-listed Chinese companies, though little progress had been made.“From our perspective, any further discussions about access are unlikely to be productive unless and until the Chinese authorities are willing to embrace certain principles that ensure our fundamental ability to accomplish our mission,” Duhnke said at a virtual round-table discussion organized by the U.S. Securities and Exchange Commission (SEC).’State secrets’The PCAOB was established by the Sarbanes-Oxley Act in 2002 to oversee the audits of public companies traded on U.S. exchanges. China is one of the only countries in the world that have failed since then to reach an agreement with the board.
When asked to disclose financial information to U.S. auditors, many Chinese companies with significant government links refuse on the ground that they would be revealing “state secrets.”Yet these companies are often embroiled in accounting scandals and accused of inflating their financial records to attract more capital. The latest scandal involves the Xiamen-based coffee chain Luckin, which overstated the company’s 2019 sales by about $310 million. The company’s share value fell by 80% after the disclosure.The U.S. Senate in early May passed a bill that could bar many Chinese companies from listing shares on U.S. exchanges unless they abide by U.S. auditing rules.The Holding Foreign Companies Accountable Act would require Chinese companies to demonstrate they are neither owned nor controlled by a foreign government. It would also require the companies to submit to an audit that can be reviewed by the PCAOB, or face delisting from U.S. exchanges.FILE – Financial market information is displayed on a big screen inside the London Stock Exchange, Tuesday, Aug. 25, 2015.Not all American investors welcome the move. Some have voiced concerns that the bill, if it becomes law, could shut them out of high-yield investment opportunities that would remain open to investors in other countries.Guo Yafu, CEO of TJ Capital Management, told VOA the efforts of Congress and the Trump administration could be a double-edged sword. He said the new rules could greatly limit the growth of these Chinese companies, but “it will also hurt Wall Street.”“These Chinese companies might seek secondary listings in Hong Kong, London or Singapore,’ he told VOA.Guo said both London and Singapore were trying to attract these companies by offering to cover part of their listing fees. “For example, the Singapore government says they will cover 20% of listing fees for foreign companies willing to list in its exchange, and 75% in the case of high-tech companies,” he said.Hong KongHong Kong also is a hot destination for secondary listings for Chinese firms. Alibaba, the e-commerce giant based in China, already has a secondary listing on the Hong Kong stock exchange.New doubts have arisen about the safety of capital invested in Hong Kong, however, with the passing by Beijing of a controversial new national security law. U.S. President Donald Trump responded to that law Tuesday by signing an executive order that ended America’s special trade treatment of Hong Kong.“Hong Kong will now be treated the same as mainland China — no special privileges, no special economic treatment and no export of sensitive technologies,” Trump said at a press conference.These new developments have many companies rethinking their choice of secondary listing destinations.Yet Alicia Gracia-Herrero, chief economist for Asia Pacific at French investment bank Natixis, told VOA that Hong Kong remains a viable choice for Chinese companies.“Hong Kong is still an option since the bulk of the funds there are not U.S.-related but China/Asia-related. Subsidiaries of major Chinese companies and financial institutions are major investors in Hong Kong and they are bound to stay, the more so if they are [partially] state-owned,” she told VOA.According to an analysis by the Harvard Business Review, China is still very dependent on Hong Kong for trade, foreign direct investment, equity and debt capital, and foreign currency exchange. “That self-interest should keep its leaders from going too far with implementing the security law,” it said.Nevertheless, Gracia-Herrero said America’s Nasdaq exchange remains unequaled as a platform for high-tech companies to secure U.S. dollar financing.
 
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