Regulating Cross-Border Data Flow Between EU and India Using Digital Trade Agreement: An Explorative Analysis

Abstract

With data flows forming an integral part of cross-border digital trade and e-commerce models, cross-border data protection measures have gained prominence in the domain of international trade. However, provisions regarding the same in Europe and India lay down several conditions to regulate such flows. On one hand, provisions of EU may create the “Brussels effect” (requiring the world to comply with its unilateral restrictions), and on the other hand, countries such as India seem to be introducing protectionist measures such as data localization as part of its proposed data protection regime. Therefore, this chapter analyzes the questions whether such cross-border data flows, as part of digital trade between EU and India, be regulated by a digital trade agreement to avoid an e-commerce splinternet. To answer this, the question of whether restrictive cross-border data transfer mechanisms as well as fragmented rules may create an e-commerce splinternet, qualifying further as a trade barrier under the ambit of international trade law, specifically the GATS, is pondered over. The paper concludes by recommending factors to be taken into consideration in case a trade agreement is proposed between the EU and India, to facilitate e-commerce between the two countries and to resolve the issue of fragmented regulations concerning digital trade.