The new agreement has been approved by the various European governments. The original agreement allowed companies in the US to self-certify that they had taken the appropriate steps to protect European data. However, there were leaks which proved that data security was not strong enough, and the European Court of Justice decided to throw out the former agreement.
There has been strong approval of the new policy by the EU and this means that formal adoption of this new agreement can take place within a few days. The Privacy Shield ensures a high level of data protection and is very different from the agreement that it replaces.
There has been some uncertainty in recent months, particularly for tech companies, but the new agreement covers everything from employee data to online transaction records. US companies were able to get around some EU regulations when Safe Harbour was in place, and its downfall came about after there were revelations that the NSA was carrying out surveillance using supposedly protected data.
The Privacy Shield now has stronger and clearer safeguards and limitations on data security, forcing US companies to protect EU data to the same level of protection that the data is protected in the EU. Industry experts have welcomed the news of the new agreement, which has undergone multiple revisions when the early drafts did not provide sufficient reassurance.