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  • Background. Company B-1 and Company B-2 are corporate affiliates who are under common ownership or control but are separate legal entities. While data is being directly sent from Controller A in Europe to Controller B-2 in the United States, Controller A has contracted only with Controller B-1 in Europe. Solid line indicates the data flow; dashed line indicates the contract relationships.
  • No mechanism needed for transfer from Company A to Company B-1. The GDPR does not require a safeguard mechanism for data transferred from a company in the EEA to another company in the EEA. In the visual depiction, while data is not being physically transferred from Company A to Company B-1, Company B-1 might be classified as a “controller” to the extent it determines the purpose and means of processing the data (e.g., while it is in the possession of Company B-2).
  • 1st SCC Module 1. Although Company B-1 and Company B-2 may be under common ownership or control, as separate legal entities they are required to put into place a safeguard when transferring data from the EEA to the US.[1] In this case, while no physical data is being transferred from Company B-1 to Company B-2, the parties might consider putting in place a Standard Contractual Clause (SCC) as the transfer of data is being done at the direction of Company B-1.
  • 2nd SCC Module 1. The GDPR requires that “any transfer of personal data” has an adequate safeguard.[2] As data is being physically transmitted by Company A to Company B-2, an argument could be made that an SCC Module 1 should be in place between those two entities, even if Company A transmitted the data pursuant to a separate contract with Company B-2’s corporate affiliate (i.e., Company B-1).
  • Transfer Impact Assessments. Section 14 of the SCCs requires that (Company A, Company B-1, and Company B-2) document a transfer impact assessment of U.S. law to determine whether any party has reason to believe the laws and practices of the United States that apply to the personal data transferred prevent Company B-2 from fulfilling its obligations under the SCCs.
  • Law enforcement request policy. Section 15 of the SCCs requires Company B-2 to take specific steps in the event it receives a request from a public authority for access to personal data. As a result, Company B-2 might consider creating a law enforcement request policy.

 

[1]EDPB, Guidelines 05/2021 on the interplay between the application of Article 3 and the provisions on international transfers as per Chapter V of the GDPR at para. 16.

[2]GDPR, Art. 44.