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Increased Uncertainty of Data Laws Takes a Toll on U.S. Businesses

June 25, 2019

New Report Identifies Seven Costs Incurred by U.S. Companies Due to Growing Patchwork Of Data Regulation

WASHINGTON – A report released today by the Data Catalyst Institute (DCI) identifies and details the wide-range of costs of uncertainty around data protection and data privacy laws. The report was written by George Mason University Law School professor, Dr. Murat Mungan, and published by DCI as part of its economic research, topical white papers, and public policy analysis.

In the report, Professor Mungan identifies seven types of costs that companies experience because of regulatory uncertainty and ambiguity: research costs, deterrence of entry/less competition, stifling of R&D, avoidance costs, free riding, deterrence reduction, and quality reduction.

“Data protection and privacy regulations take place through a patchwork of regulation across the globe,” said Dr. Mungan. “A business in the United States may have to comply with state, federal, European, and other regulations, depending on the reach of its activities creating a great deal of uncertainty. This report serves as a guide for policymakers to understand how this uncertainty translates into real costs to companies.”

In addition to the report, DCI also released an analysis of India’s recent proposal to create a national e-commerce policy. The proposal received a score of 35 out of 100; the lowest score given to date.

“As policymakers consider regulation and legislation aimed at shaping data privacy policies, it is important they understand what is at stake,” said Peter Cherukuri, Executive Director & Publisher of the Data Catalyst Institute. “Dr. Mungan’s analysis of data regulation costs and our scorecard on India’s e-commerce proposal provides tangible insights for policymakers and industry stakeholders to navigate this uncharted terrain.”

The Data Catalyst Institute is the leading data policy think tank and producer of academic research and policy analysis. DCI will release more than a dozen additional white papers and research reports covering the data regulation landscape. Topics include:

  • Consent Frameworks
  • Information Fiduciaries – lessons learned from the Biomedical Industry
  • Protecting the Right to Encrypt
  • Understanding Informational Injury
  • Data Localization – what can the US learn from India
  • Data Processors as Fiduciaries
  • Ownership and Control in the Data Economy
  • Rise of Data Nationalism
  • Data Mobility Privacy Responsibilities and Liabilities
  • Minors in the Digital Economy and Challenges in Age Verification
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