A PYMNTS Company

Japanese Tech Lobby Urges Revision of EU Cybersecurity Labelling Scheme

 |  December 5, 2023

In a collaborative effort with U.S. Big Tech, the Japan Association of New Economy, a prominent business lobby group, has issued a cautionary statement against the proposed European Union (EU) cybersecurity labelling rules.

These rules, aimed at establishing the EU Certification Scheme (EUCS), have raised concerns among Japanese and American tech giants, suggesting potential impediments to market access within the EU, reported Reuters.

The EU’s initiative seeks to implement a certification scheme to guarantee the cybersecurity integrity of cloud services. The intended outcome is to assist governments and companies within the bloc in making informed decisions when selecting secure vendors for their operations.

However, a contentious requirement within the proposed scheme stipulates that non-EU cloud providers, including industry giants Amazon, Google, and Microsoft, must form joint ventures with EU-based companies to qualify for the coveted EU cybersecurity label.

This particular provision has drawn criticism from both within the EU and overseas vendors. The Japan Association of New Economy, through its director Hiroshi Mikitani, expressed its disapproval in a letter addressed to EU industry chief Thierry Breton, dated November 28 and obtained by Reuters.

Related: EU Agrees New Cybersecurity Legislation

In the letter, Mikitani argued that the requirement could inadvertently create a de facto market access barrier, adversely affecting businesses in both the EU and Japan. He urged a reevaluation of the EUCS in consideration of the existing EU-Japan Digital Partnership, the Japan-EU mutual adequacy arrangement, and the Agreement in Principle on Negotiations Concerning Provisions on the ‘Free Flow of Data’ under the Japan-EU Economic Partnership Agreement.

The Japan Association of New Economy, a renowned business lobby group with a focus on e-business and the development of new industries, boasts the membership of influential business leaders. Hiroshi Mikitani, the chief executive of Japanese e-commerce and fintech firm Rakuten, leads the organization.

As the debate over the EU cybersecurity labelling scheme continues, it remains to be seen how the concerns raised by the Japan Association of New Economy and other industry stakeholders will influence the finalization of these proposed regulations. The intersection of global tech interests and regional regulatory frameworks continues to shape the evolving landscape of cybersecurity and market access.

Source: Reuters