The EU is forging a relationship with California on data privacy

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When European Commissioner for Justice Didier Reynders traveled to San Francisco last week before his latest D.C. visit, his agenda featured a notable name: Ashkan Soltani, chief of the California agency tasked with overseeing the state’s landmark data privacy law.

Reynders said the session was meant to strengthen coordination between the California Privacy Protection Agency (CPPA) and the European Union — which in 2018 enacted its own watershed privacy rules.

“We are maybe closer to California about the way to put into place the regulation,” Reynders told Cat Zakrzewski and I in an interview at The Washington Post on Monday.

The meeting underscores California’s outsize role in tech regulation in the United States, where the federal policymakers have struggled to advance their own rule books on data privacy and other major tech fronts.

Reynders, who last year announced an “informal dialogue” on protection issues with the Federal Trade Commission and on Monday unveiled a new one with the Consumer Financial Protection Bureau, said the aim was to develop a similarly close relationship with the state agency.

“To promote such a collaboration would be very helpful for different concrete discussions but maybe also to show that the fragmentation is a real risk, and so that we have to work more together about international standards,” Reynders said.

Reynders said the exchange between European and California officials is particularly important given the lack of federal privacy standards, and he expressed hope that together the two sides could “continue to promote a … possible federal privacy law or a common approach” on tech.

California’s privacy law for years has been a divisive factor in the federal debate around privacy legislation, even as more and more states pass their own rules.

The CPPA and other state officials last year came out against a bipartisan privacy bill that became the first of its kind to advance out of committee on Capitol Hill, amid fears it could hinder enforcement of the California law. A few weeks later, former House speaker Nancy Pelosi (D-Calif.) voiced similar concerns, dealing a blow to the proposal’s prospects.

Republican lawmakers have pushed back on the criticisms and called for a federal law to override California’s measure to harmonize privacy protections across the United States.

Reynders separately addressed the deal he recently helped broker between the United States and E.U. providing a framework to allow companies to transfer data between countries, saying he was “quite confident” it would withstand any future legal challenges.

“After a long period of discussion, it was possible to agree … on a very robust new solution, due to the fact that there are huge changes in the process,” he said.

And Reynders pushed back on criticisms that the agreement, intended to safeguard European user data from potential spying by U.S. intelligence agencies, will not adequately head off those concerns without congressional legislation to limit federal surveillance powers.

“Our goal was not to change the entire intelligence system in the U.S. It was to be sure that we have a correct application of the requirements of the [E.U.] Court of Justice,” he said.

Reynders also discussed the bloc’s next steps on artificial intelligence, expressing hope that they could find agreement on a new potential liability framework for when AI tools cause harm before the E.U. elections next year.

“If it’s possible to conclude the discussions before the end of my mandate, that would help to do that … we need to solve the legislative fight,” he said.

Reynders said he did not think the bloc needed to hold off on debating his liability framework until after it adopted its broader package, known as the E.U. AI Act.

“It’s possible … to have some discussions, so we have put the file on the table and now it’s just a question of the negotiations with the so-called co-legislators in Europe … and the Parliament,” he said.

Sen. Elizabeth Warren (D-Mass.) on Monday asked the Securities and Exchange Commission to open an investigation into Tesla’s board of directors, alleging it failed to manage the actions of CEO Elon Musk in his role running both the electric vehicle company and Twitter.

“Mr. Musk’s actions since purchasing Twitter and becoming its Chief Executive Officer (CEO) — while remaining Tesla’s CEO — have raised concerns about conflicts of interest, misappropriation of corporate assets, and other negative impacts to Tesla shareholders,” she wrote in the letter addressed to SEC Chair Gary Gensler.

Warren last year sent a related letter to Tesla’s board over potential corporate governance issues related to Musk’s Twitter purchase. It cited potential conflicts including Musk reportedly directing Tesla staff to work on his takeover of Twitter and Twitter’s reliance on advertising revenue from Tesla's competitors.

“Mr. Musk’s personal wealth — and his personal relationships with Board members — do not shield him or the Tesla Board from meeting basic SEC governance and disclosure rules,” Warren said in the July 17 request. The SEC, Tesla and Twitter did not return a request for comment.

Microsoft is nearing completion of its $69 billion purchase of video game company Activision Blizzard, but it will likely not close the transaction by a Tuesday deadline, Leah Nylen and Dina Bass report for Bloomberg News, citing people familiar with the deal.

They write: “The companies don’t plan to walk away from the deal and will continue seeking the final regulatory approvals needed for closing, said the people, who declined to be named because they were not authorized to speak publicly on the matter.” The purchase agreement was originally set for Tuesday.

Several legal pathways have recently been cleared for the deal to proceed after the U.S. Federal Trade Commission unsuccessfully blocked the transaction in court, while the U.K.’s Competition and Markets Authority allowed for new negotiations over the purchase after previously blocking it.

Microsoft and Activision declined to comment. The U.K. and Microsoft had “productive” conversations, Bloomberg News’s Katharine Gemmell reported Monday morning, citing a lawyer from the nation’s competition watchdog.

The executives of top chipmaking companies met with Biden administration officials on Monday to discuss China policies, David Shepardson and Stephen Nellis report for Reuters.

They write: “Secretary of State Antony Blinken talked with chip company chief executives about the industry and supply chains after his recent trip to China, a department spokesperson told reporters.”

Additionally, Commerce Secretary Gina Raimondo, National Economic Council Director Lael Brainard and National Security Council Director Jake Sullivan were among other officials that met with the CEOs of Intel, Qualcomm and Nvidia, the report adds, citing a source familiar with the meeting.

The meeting comes shortly after China restricted exports of key minerals needed for chipmaking. Those restrictions, alongside U.S. chipmaking subsidies and China-linked chip supply chains, were discussed with Blinken and others, according to the report. The three companies have “crucial sales riding on China,” Reuters adds.

SEC’s Gensler warns AI risks financial stability (Bloomberg News)

U.S. lawmakers extend social media investigation to Meta's Threads (CNBC)

Plaintiffs ask US Supreme Court to temporarily halt Microsoft, Activision merger (Reuters)

US limits on China tech investment to be narrow and slow (Bloomberg News)

Apple can enforce anti-steering rule pending high court appeal (Bloomberg Law)

Facebook, Instagram face Norwegian ban from tracking users for ads (Politico)

Why people love sharing their locations, despite the risks (Axios)

Laid-off Twitter Africa team 'ghosted' without severance pay or benefits, former employees say (CNN)

The walk from Oppenheimer to Barbie https://t.co/mEDMQSxqQc pic.twitter.com/G2FZphSK8B

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