U.S. companies failing to comply with the General Data Protection Regulation (GDPR) when they are doing business in Europe face losing billions of dollars in lawsuits.
“We’re talking about a law that has 99 articles,” Scott Vernick, a Fox Rothschild law partner, told Liz Claman during a FOX Business interview on Friday. “It’s over 200 pages long, it’s very complex.”
The GDPR, which governs the collection of personal information of individuals within the European Union, went into effect Friday. It requires that all companies operating in the EU must obtain people’s consent before using or selling any of their personal information.
Some U.S. news websites including the Chicago Tribune and the Los Angeles Times were unavailable in Europe as they worked to comply with the rule.
Facebook and Google are accused of violating GDPR regulations and face $8.8 billion in potential fines combined. Vernick said the multibillion-dollar lawsuit against the U.S. tech giants was filed by the privacy advocate Max Schrems.
The cost for American companies to stay in compliance has been incredibly high, averaging an estimated $16 million, according to Vernick.
“On average, companies will have to hire maybe five full-time professionals in order to keep themselves in compliance,” he said.