FBI's Fight With Apple Over Encryption May Erode European Trust in U.S.

Security cameras are seen near the main entrance of the European Union Council building in Brussels in July 2013. REUTERS/Francois Lenoir

With Apple openly fighting court orders backed by the FBI and the Department of Justice this week, several news outlets have reported on how Russia and China may use this case to expand their surveillance powers.

But this legal battle may have huge ripple effects among America's closest allies in Europe as well. The United States and the European Union do not currently have an agreement on how to share data across the Atlantic. But both sides have recently reached a new transatlantic data protection agreement called Privacy Shield, which would allow companies to move data across the Atlantic lawfully and with protection against foreign threats.

But European public trust toward the United States remains shaky following the disclosure via Edward Snowden that the National Security Agency (NSA) engaged in large-scale data collection involving EU citizens. If the FBI is able to coerce Apple into opening encrypted smartphones, that trust—and maybe even Privacy Shield—could topple quickly, one security expert tells Newsweek.

"Privacy advocates will use this is as a bargaining position against Privacy Shield," says Stephen Cobb, a senior security researcher at the IT security company ESET. "They will cry, 'See, the United States is still not secure.'"

Wounded by the revelation that the NSA spied on European government leaders such as German Chancellor Angela Merkel, the European Union has been wary of American surveillance. Following the discovery, Europe's highest court in October ruled invalid a 15-year-old transatlantic data protection agreement called Safe Harbor, leaving thousands of businesses on both sides of the Atlantic scrambling over how to transfer data between the continents and store it.

Max Schrems, the Austrian who brought the Safe Harbor case to the European Court of Justice and won, tells Newsweek that the FBI's possible victory over Apple isn't too concerning to Europeans because it is a targeted access to data—not the pre-Snowden tactics of bulk data collection.

But Schrems believes it will have a side effect in angering Europeans more when it comes to the United States, which could lead to disastrous consequences for both the American government and businesses.

"I think trust in security is politically and commercially highly relevant‎," writes Schrems in an email. "When Europe did not trust in U.S. law they could still work with technical solutions that factually 'lock the US authorities out.' If this is now also undermined, companies and consumers have neither a legal nor a technical reason to trust these products."

While the European Union as a whole remains stricter on privacy issues compared to the United States, individual European countries have taken different courses on encryption. The United Kingdom for the last year has been considering a proposal to require backdoor access to encrypted products.

On the other side of the debate, the Netherlands publically announced it will not be pursuing encryption backdoors. "The Dutch government thinks undermining encryption will hurt its national security," says Victoria Espinel, president of BSA (The Software Alliance). Despite the November attacks on Paris, France too is leaning pro-encryption, according to Espinel.

With European states standing on both sides of the encryption debate, the Privacy Shield may pose an interesting test to the EU on its own stance on privacy. The agreement will need to be finalized in a vote by 28 European states. The details of Privacy Shield, which was agreed to on February 2, is still unknown to the public and even European privacy regulators.

Schrems believes there will be little to no changes to Privacy Shield from Safe Harbor. Privacy Shield is so far a gentleman's agreement, and both sides are finalizing the language of the bill over the next few weeks. One part of Privacy Shield has been been made public: To avoid NSA surveillance in Europe, American negotiators agreed to provide annual written assurances that European privacy rights are respected by United States agencies, according to The New York Times.

Despite the assurances, skeptical data privacy advocates are planning to challenge Privacy Shield in court once it's in effect. "It's not a 'Privacy Shield,' it's an accountability shield. Never seen a policy agreement so universally criticized," Snowden tweeted.

It's not a "Privacy Shield," it's an accountability shield. Never seen a policy agreement so universally criticized. https://t.co/VxXxxkIEPR

— Edward Snowden (@Snowden) February 2, 2016