THE EU-ASEAN Business Council (EU-ABC) said that Southeast Asia must improve secure cross-border data transfers to achieve a projected $300-billion Internet economy in five years.

The council in a report said the importance of data security and protection has been highlighted in the wake of the coronavirus disease 2019 (COVID-19) pandemic.

“As countries in the region are in varying levels of physical lockdowns due to COVID-19, millions more citizens are taking to digital tools such as online learning, video conferencing and telemedicine. This places ever greater importance on data security and privacy protection,” EU-ABC Chairman Donald Kanak said in a statement.

The report, Data Governance in ASEAN: From Rhetoric to Reality, listed the Philippines among Southeast Asian countries that are modernizing their data protection frameworks, noting that the country did not make it to the top 50 in a survey of 100 economies studying their ability to benefit from digitization.

The council, however, does not support data localization, or the requirement that data must be processed and stored within a country to meet local privacy laws prior to being transferred to another country.

“Instead, the council encourages the government to permit data transfers in the regular course of business, with exceptions where necessary for privacy or security purposes.”

The council said that ASEAN member states must allow secure data transfers across borders by using leading technologies and harmonized rules.

“Develop a coherent, transparent and consistent data classification framework which can promote interoperability across sectors. This will facilitate data to flow easily, efficiently and securely within and across multiple sectors.”

The group said that companies must be ordered to adhere to international standards, which it said will help small and medium-sized enterprises build trust with different stakeholders within the region.

They said rules must be compatible with the European Union’s General Data Protection Regulation (GDPR), adding that ASEAN businesses have to apply these regulations when offering goods and services to people living in the European Union.

“There is an urgency for businesses in Southeast Asia to incorporate GDPR to their day-to-day operations or risking losing out in a $17-trillion economy,” according to the report.

EU-ABC said that harmonized cross-border flows will not only promote intra-ASEAN trade but also trade and investment with key dialogue partners, including the European Union.

“The Council encourages governments to design legal frameworks that facilitate data transfers in the regular course of business, while ensuring that such transfers take place with appropriate privacy and data security safeguards.” — Jenina P. Ibañez