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governments across Europe began trading data with one another – data protection officials
organized to resolve cross border frictions. National data protection commissioners, a
product of national legislation from the 1970s, as the standard bearer of individual rights
worked at the supranational level to not only ease transaction costs associated with
international business but also enhance data privacy liberties. Pursuing a tactic I term
enlightened divergence, the expert data protection community leveraged their export control
over cross-border information flows to force European Union regulation. The national data
protection commissioners simultaneously called for increased protection of personal
information and reinforced their national regulatory powers.
The paper is organized into four sections. The first section presents several
alternative explanations for the evolution of the directive before previewing the chapter
argument. The second section follows the development of the directive from the late 1980s
until its passage in 1995. A third section provides a more detailed account of the resulting
document and its effects. The fourth and final section examines the case and elaborates
several suggestions for theories of regulatory intensification by trading up, epistemic
communities, and European integration. For the trading up literature, the paper suggests that
firms from the largest markets calculate the cost/benefits of high harmonization and often
choose to stick with the sunk costs of existing regulation. Instead of global players or partisan
governments initiating regulatory change, independent regulators wielding export controls
over their markets may force regulatory intensification. For the epistemic community
literature, the paper concludes that experts may push for a common international goal while
also attempting to enhance national regulatory authority. Finally, the historical narrative
provides evidence for theories that pit transnational actors, especially regulatory agencies, as
prime movers of European integration.
Convention