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Data Act: Data donation business model

With the introduction of the Data Act, the EU aims to create a uniform legal framework for the access to and exchange of data. The draft Data Act was presented in February 2022 and has now been approved by the European Parliament. The legislative project should be completed by the end of 2023 and then come into force.

The aim of all this is to control data access while maintaining high ethical data protection and security standards. It is therefore important for companies to act quickly. Product development cycles are generally long and the Data Act is expected to come into force at the end of 2024.

 

The Data Act entails far-reaching changes that need to be taken into account as early as the product development stage. It is important that all companies in the European Union that develop smart products or services and generate this data take this into account. Unlike the GDPR, the Data Act is not limited to personal data, but covers all types of data, including data from vehicles, household appliances, consumer goods, health and lifestyle products. Products such as smartphones, servers and tablets, which were excluded in the original draft, now fall within the scope of the Data Act. This applies both to the products themselves and to the associated digital services and the necessary software.

The aim of the Data Act is to facilitate access to and use of data for users of smart products and companies. Smart products must be designed to be data-friendly in order to provide users with simple, secure and direct access to the generated data. If direct access is not possible, the data owners must make the data available to the user. Before concluding a contract, manufacturers must therefore provide clear information about data access and inform users about how they can access the data and whether they may pass the data on to third parties. Data should be made available quickly, free of charge and, if necessary, continuously and in real time. Companies must consider the technical implementation of these requirements. The provision of data by data owners must be fair and transparent in order to protect business secrets and avoid sanctions and high fines.

The Data Act thus brings the EU closer to its goal of a single market for data and the promotion of innovation through the increased use of data. However, manufacturers of intelligent products must meet the high requirements. The Data Act is currently at the draft legislation stage, but could quickly become law. Unlike directives, which generally give member states two years to implement them, the Data Act is a regulation that applies immediately in the EU. Companies must therefore act early and coordinate with product development in order to implement the requirements of the Data Act in good time.

We are here to help you better understand and implement the far-reaching implications of the Data Act for your business. We will support you with the requirements of the Act and help you to realize the full potential of your data. Let's explore the opportunities presented by the Data Act together and develop customized solutions tailored to your specific needs.

About the author

 

Rainer Duda is a Data & AI Consultant at M&M Software and advises companies on the development of data-driven business models and the realization of AI-supported applications. He worked for many years as a data scientist at the renowned Institute for Telematics (TECO) at the Karlsruhe Institute of Technology (KIT), including on the Smart Data Solution Center Baden-W├╝rttemberg (SDSC BW) project, and holds lectureships in multivariate statistics and applied data science.

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