Box to open European data centres after ECJ privacy ruling

Box, which offers online storage and collaboration software to companies, is working towards allowing its customers to choose where to store their data

Aaron Levie said: 'The problem is that none of our governments is able to comprehend the global nature of the internet in how it is used and how it has been architected' Photo: Reuters

By Christopher Williams

Box, one of Silicon Valley’s leading cloud computing providers, is planning to set up European data centres within a year, following a court ruling that stuck a heavy blow to a key transatlantic privacy agreement.

The European Court of Justice (ECJ) said this week that the "Safe Harbour" rules, which have allowed companies including Facebook and Google to store personal data in the US under EU privacy standards, were invalid.

Box, which offers online storage and collaboration software to companies, said it is now working towards allowing its customers to choose where to store their data.

The move is at the forefront of what is expected to be a wave of changes from US internet companies. Amazon has also begun building European data centres.

Aaron Levie, Box’s co-founder and chief executive, said: “In a year from now I would absolutely expect we will have customers storing their data internationally. We’re building towards it now.”

Aaron Levie, Box's co-founder and chief executive
Mr Levie, speaking last week ahead of the widely expected ECJ ruling, criticised “legacy” privacy laws that “make no sense”, but accepted there were good reasons why European countries would want personal data to remain inside the EU.
He suggested the end of Safe Harbour had been caused by a combination of Europe’s more privacy-sensitive culture, political and trade concerns about the dominance of American internet giants and practical concerns such as the ability of law enforcement agencies to access data.
Mr Levie said: “The problem is that none of our governments is able to comprehend the global nature of the internet in how it is used and how it has been architected.
“Until we really appreciate how global and interconnected our societies and businesses are, we’ll probably never have legislation or policies that truly get to the heart of how you should regulate the internet.”
Box’s new “data residency” strategy is likely to depend on its commercial partnership with IBM. The IT giant already has data centres in Europe, avoiding the need for Box, which made its stock market debut this year, to build its own.
Facebook claimed its transfers of personal data to the US are legal
Dan Levin, Box’s chief operating officer, added: “Allowing our customers to store their data where they want to is an important future direction for us.”
Facebook, which was at the centre of the ECJ judgment, claimed that its transfers of personal data to the US are legal.
A Box spokesman said the company was confident its current data storage arrangements were legal despite its plans and the ECJ ruling.
He said: "We're committed to ensuring Box is the most trusted platform for enterprise content management and collaboration globally."