Internet Firms to Be Subject to New Cyber-Security Rules in EU

Internet firms such as Cisco, Google and Amazon will be subject to a new EU cyber-security law forcing them to adopt tough security measures and possibly report serious breaches to national authorities, according to a document seen by Reuters.

The so-called Network and Information Security Directive has been stuck in talks between member states and EU lawmakers because of disagreements over whether to include digital platforms such as search engines, social networks, e-commerce sites and cloud computing providers.

Members of the European Parliament want the law to only cover sectors they consider critical, such as energy, transport and finance.

But after months of negotiations, digital platforms will now fall under the law's remit, albeit with less onerous security obligations, according to the document, which did not provide details of the obligations.

The paper from Luxembourg, which holds the rotating European Union presidency, suggests adopting a lighter approach for digital service platforms which typically do not have direct links to physical infrastructure such as, for example, a nuclear power company.

Any firm meeting the law's definition of a digital service platform which is still under discussion would automatically be covered to avoid member states taking different approaches and causing fragmentation across the 28-nation EU.

A cloud computing provider or any other digital firm providing a service for an infrastructure operator would be subject to the same rules applying to that operator, according to the document, which could still change in discussions after the summer.

Internet firms will also be subject to notification requirements in cases of security breaches, although there is no agreement yet on whether these should be mandatory or voluntary.

The paper asks member states to express their preferences at a meeting in September, after which drafting of a full legal text will start.

Firms in the digital sphere oppose being included in the law's scope.

"We're pleased to see digital service platforms subject to a different regime but we're disappointed at the lack of recognition that it is the use of cloud that determines the security risk not the service itself," said Chris Gow, Senior Manager, Government Affairs at Cisco.

The European Commission the EU executive and some member states reckon that because of the widespread use of Internet services and the number of businesses that rely on the web they should also be subject to security rules and reporting requirements.

Currently there is no pan-European cyber-security law and only telecoms operators are subject to the incident-reporting requirements.

© Thomson Reuters 2015