EN EN EUROPEAN COMMISSION Brussels, 23.2.2022 COM(2022) 68 final 2022/0047 (COD) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on harmonised rules on fair access to and use of data (Data Act) (Text with EEA relevance) {SEC(2022) 81 final} - {SWD(2022) 34 final} - {SWD(2022) 35 final} EN 1 EN EXPLANATORY MEMORANDUM 1. CONTEXT OF THE PROPOSAL • Reasons for and objectives of the proposal This explanatory memorandum accompanies the proposal for a Regulation on harmonised rules on fair access to and use of data (Data Act). Data is a core component of the digital economy, and an essential resource to secure the green and digital transitions. The volume of data generated by humans and machines has been increasing exponentially in recent years. Most data are unused however, or its value is concentrated in the hands of relatively few large companies. Low trust, conflicting economic incentives and technological obstacles impede the full realisation of the potential of data - driven innovation. It is therefore crucial to unlock such potential by providing opportunities for the reuse of data, as well as by removing barriers to the developm ent of the European data economy in compliance with European rules and fully respecting European values , and in line with the mission to reduc e the digital divide so that everyone benefits from these opportunities. Ensuring greater balance in the distribut ion of the value from data in step with the new wave of non- personal industrial data and the proliferation of products connected to the Internet of Things means there is enormous potential for boosting a sustainable data economy in Europe. Regulating data access and use is a fundamental prerequisite for seizing the opportunities presented by the digital age we live in . The President of the Commission, Ursula von der Leyen, stated in her political guidelines for the 2019- 2024 Commission that Europe must ‘balance the flow and use of data while preserving high privacy, security, safety and ethical standards ’ 1. The Commission Work Programme 20202 set out several strategic objectives, including the European strategy for d ata3, adopted in February 2020. That strategy aims at building a genuine single market for data and at making Europe a global leader in the data - agile economy. For this reason, the Data Act is a key pillar and the second major initiative announced in the data strategy. In particular, it contributes to the creation of a cross -sectoral governance framework for data access and use by legislating on matters that affect relations between data economy actors, in order to provide incentives for horizontal data sharing across sectors. The European Council’s Conclusions of 21- 22 October 2021 underlined ‘ the importance of making rapid progress on existing and future initiatives, in particular unlocking the value of data in Europe, notably through a comprehensive regulatory framework that is conducive to innovation and facilitates better data portability, fair access to data and ensures interoperability ’ 4. On 25 March 2021, the European Council reiterated ‘ the importance of better exploiting the potential of data and digital technologies for the benefit of the society and economy ’5. On 1- 2 October 2020, it stressed ‘ the need to make high- quality data more readily available and to promote and enable better sharing and pooling of data, as well as 1 Ursula von der Leyen, A Union that strives for more - My agenda for Europe, Political guidelines for the next European Commission 2019- 2024 , 16 July 2019 2 European Commiss ion, Annexes to the Commission Work Programme 2020 - A Union that strives for more , COM(2020) 37, 29 January 2020 3 COM/2020/66 final 4 European Council, European Council meeting (21 -22 October 2021) - Conclusion EUCO 17/21, 2021 , p. 2. 5 European Council, Statement of the members of the Eur