Cross-Border ‘Data Adequacy’ Frameworks under GATS Article VII: Aligning WTO Members’ Rights to Protect Personal Data with Their International Commitments

The exponential growth of cross-border data flows and fragmented national and regional data protection standards have intensified regulatory challenges in global trade. The effects of regulatory divergence are amplified by a lack of transparency, potentially masking discriminatory practices. Article VII of the General Agreement on Trade in Services (GATS) offers a framework for recognition agreements to bridge these gaps but is not utilized in practice. This paper examines the interplay between GATS Article VII and the EU data adequacy decisions – currently the most comprehensive bilateral framework for assessing compatibility between data protection regimes among other WTO members. It argues that data adequacy frameworks qualify as recognition agreements/arrangements under GATS, offering potential to reduce the trade effects of differences in data protection laws globally while safeguarding regulatory autonomy. A roadmap for leveraging Article VII to advance international alignment is developed to help realize the dual goals of enhancing global cooperation and strengthening privacy protection.