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International Commercial Law - Digital Trade and Data Protection
Can you answer these practice questions about international commercial law? Good luck!
Based on a course by Andreas von Goldbeck.
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Last updated: October 12, 2024
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| First submitted | October 12, 2024 |
| Times taken | 7 |
| Average score | 60.0% | Report this quiz | Report |
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1. OceanCorp, a U.S.-based e-commerce company, handles significant volumes of personal data
from European customers. Following the Schrems II decision, the company can no longer rely
on the Privacy Shield for transferring data between the U.S. and the EU. OceanCorp decides
to use Standard Contractual Clauses (SCCs) instead, but its legal team is unsure whether the
SCCs provide sufficient protection given U.S. government surveillance practices. What must OceanCorp ensure to comply with GDPR when using SCCs to transfer
personal data from the EU to the U.S.?
Following the Schrems II decision, companies must implement additional measures beyond SCCs if there are concerns about foreign surveillance. They must ensure that the data transferred is protected in compliance with EU standards.
The SCCs must be signed by both the data exporter and the importer, and the U.S. must implement equivalent data protection laws as the EU.
The SCCs must include specific guarantees for protecting personal data from government surveillance in line with EU standards, and additional measures may be necessary.
OceanCorp can use SCCs without worrying about U.S. surveillance laws, as they are automatically considered sufficient under EU law.
OceanCorp must shift all data processing operations to the EU to comply with GDPR fully.
2. FinData, a fintech company, develops an AI-driven credit scoring tool. The system processes
vast amounts of customer data, including personal financial histories, to generate accurate
predictions. However, the company faces challenges complying with the GDPR’s principle of
data minimization, as the AI requires large datasets to function effectively. Which of the following strategies can FinData employ to ensure GDPR compliance
while still leveraging AI?
Pseudonymization is a technique that allows AI systems to use data while reducing risks of privacy violations, as it masks personal data but still allows processing under GDPR.
Continue processing all available data, as AI systems are exempt from the GDPR’s data minimization principle due to their complexity.
Use pseudonymization techniques to anonymize personal data while retaining its usefulness for AI processing.
Limit the data collection to only structured financial data and ignore unstructured data to minimize compliance risks.
Store data indefinitely to allow the AI to refine its predictions over time without violating GDPR’s purpose limitation.
3. SecureNet, a blockchain-based company, stores personal transaction data on a decentralized,
immutable ledger. A customer from the EU requests that SecureNet delete their personal data
in accordance with GDPR’s “Right to Be Forgotten.” However, due to the blockchain’s
immutability, SecureNet cannot directly alter the recorded data.
How can SecureNet address this request while remaining compliant with GDPR?
To reconcile blockchain’s immutability with GDPR’s “Right to Be Forgotten,” companies can store personal data off-chain while storing a cryptographic hash on the blockchain. This allows data modification or deletion off-chain.
Inform the customer that data stored on a blockchain cannot be deleted and refuse the request.
Use off-chain storage for personal data and store only cryptographic hashes on the blockchain, ensuring compliance with GDPR.
Transfer the customer’s data to a different blockchain that allows for deletion to comply with the request.
Encrypt the personal data on the blockchain and destroy the encryption keys to render the data inaccessible without altering the blockchain.
4. TechHire, an AI-powered recruitment platform, uses machine learning algorithms to screen job
applicants. It has been reported that the AI system tends to favor male candidates over female
candidates because the training data primarily consisted of male resumes. This raises concerns
about potential discrimination.
What should TechHire do to address the bias in its AI system while complying with
data protection regulations?
TechHire must address bias by retraining its AI system with a more balanced dataset. This reduces the risk of discriminatory outcomes and aligns with legal and ethical obligations under data protection laws.
Allow the AI to continue operating without changes, as any modifications could disrupt the recruitment process.
Retrain the AI model using more diverse datasets to reduce bias and ensure fairness in decision-making.
Inform candidates that AI decision-making is inherently biased and offer manual review options for female applicants only.
Remove the AI system entirely, as AI use in hiring violates GDPR’s data protection principles.
5. GlobalBank introduces an AI-driven credit scoring system that makes automated decisions on
loan approvals. An applicant who was denied a loan requests more information about how the
decision was made and asks for the decision to be reviewed by a human.
Which of the following rights under GDPR applies to this situation?
GDPR grants individuals the right to request human intervention in decisions made solely by automated systems, especially when such decisions have legal or significant effects on them.
The right to data portability, allowing the applicant to request a copy of the AI model used.
The right to rectification, which requires GlobalBank to adjust the applicant’s credit score upon request.
The right to be informed, requiring GlobalBank to provide clear information on how the AI decision was made.
The right not to be subject to a decision based solely on automated processing, allowing the applicant to request human intervention.
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