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Data Regulation Concept: a Business Perspective

Is Russia able to gain success in the big data market? How to maintain the balance in the relationship between the State, citizens and the business community? What are the barriers that exist in this sector? These issues, among others, were discussed by experts at the IX St. Petersburg International Legal Forum. The participants of the session on a business perspective of the data regulation concept agreed that big data have strong potential.

The discussion was joined by Nikita Danilov, Chief for relations with executive bodies, MegaFon PJSC – Head of the Legal and Compliance Committee, Big Data Association, Igor Drozdov, Chairman of the Executive Board, Skolkovo Foundation, Steven Crown, Vice-President, Microsoft Corporation, Iskender Nurbekov, Executive Director Ecosystem Development Department, SberX, Sberbank, Vladislav Onishchenko, Head, Analytical Center for the Government of the Russian Federation, Dmitry Petrov, CEO, Cometrica LLC, Alexander Savelyev, Associate professor of Higher School of Economics, Legal Counsel of IBM Russia/CIS, Dmitry Ter-Stepanov, Chief of Regulatory Affairs, ANO Digital Economy, Russian Federation, Savva Shipov, Deputy Minister of Economic Development of the Russian Federation. The session was moderated by Anna Serebryanikova, President, Big Data Association, Member of the Board of Directors, MegaFon.

Anna Serebryanikova started the discussion outlining the importance and the potential of big data. She added that by 2025 the big data market is estimated to reach 300 bln rubles and 1.5% increase of the GDP.

 “We believe that Russian companies are able to win their share in the market, it is actively growing. There are plenty of mathematically-talented people in Russia, and at the same time we do not have yet regulatory barriers that would prevent the development of technology, algorithms, and artificial intelligence. I am convinced that Russia is able to win this race”, she said and suggested that the participants of the discussion considered the big data issue from three angles, through relationship between the State, citizens and the business community.

Savva Shipov, Deputy Minister of Economic Development of the Russian Federation, was the first to take the floor. He underscored that it is high time we raised the issue of big data as currently various legislation on personal data is being drafted. There are two sides of the same coin, on the one side, we have citizens that are interested in digital services, on the other side, we have those who are not eager to follow the path of digital economy. “We have to bear in mind that not everyone is planning to shift to new technology. Therefore, my first point is that the regulation must be inclusive. Digitalization should not be indiscriminate and forced. My second point is that the State as the collector and the largest holder of big data has to be able to handle it”, said the Deputy Minister and noted that currently, for various reasons, data in many systems are overlapping and lack alignment.      

“How do we address this issue? We can establish a national data management system. It is widely debated but unfortunately it is not widely known. When I am asked about the system and about the future data controller I answer that the national data management system is not an information system, it is a management tool. It is a comprehensive system for relationship data management”, underlined Savva Shipov.

Igor Drozdov, Chairman of the Executive Board, Skolkovo Foundation, agreed with the three aspect approach and suggested that small and large business should be treated separately. He believes that it is necessary due to potentially oppositely directed interests of these businesses.

Besides, the speaker supported Savva Shipov regarding concerns about potential personal data leakage. It might harm people, and they are concerned about it. “When we are discussing the future or data we see that they have a negative connotation for people. We have not been able yet to convince them that data flow will generate new products and make life easier (for example, through personalized health services). On the other hand, it seems clear that data can be used as a surveillance and discreditation tool. A lot of work will be needed to explain the benefits of data economy”, said Drozdov.

Dmitry Ter-Stepanov, Chief of Regulatory Affairs, ANO Digital Economy, Russian Federation, brought to the attention of the participants that dealing with big data and access to it is essential to differentiate the data funded by the State and the data collected by it. “The State does not generate that much data, mostly collecting it at no cost”, said the speaker and elaborated further on regulation that should govern management of this data.

 “Our legislation should be more innovative and empowering than protective. When it comes to data protection we use a paternalistic model and presume that citizens deal with data and data collection very often. […] If we think broader, we will certainly be able to find a model that will enable citizens to respond in case of a violation of their rights and access to such tools that will ensure protection of rights. Probably, we will be able to conceive mechanisms that will enable an individual to protect their rights”, said Dmitry Ter-Stepanov.

The participants raised another significant issue related to big data definitions, e. g. personal data and their types.

“I think this discussion [on personal data] will never come to an end because our attempt to come up with a definition looks like an attempt to construct a perpetual motion machine. We undertook certain attempts within an advisory board of the Federal Supervision Agency for Communications, Information Technology and Mass Media and on other platforms. All of them failed. However, if we cannot define what it is, it does not mean that we cannot define what it is not. Here the notion of impersonalisation and anonymization play a great role because big data processing is largely impersonalized. There is still some trace that can lead to identification of a person”, expressed his point of view Alexander Savelyev, Associate professor of Higher School of Economics, Legal Counsel of IBM Russia/CIS.

Steven Crown, Vice-President, Microsoft Corporation, provided a global perspective on the development of big data in Russia and noted that, as he sees, Russia has started to work actively in this respect. “Russia can be proud of various technological advantages and should be a leading country in this sector. The GDP growth is projected at 2.5%. It is significantly higher than human productivity earlier on. This productivity boost has been generated through information technology. The growth rate will be impressive, and that is why we have to continue investing in this sector and we should not lag behind this process”, he concluded.  

St. Petersburg International Legal Forum takes place in the Eastern Wing of the General Staff Building of the State Hermitage from May 14 to 18. It is organized with the support of the President of the Russian Federation and the Ministry of Justice of the Russian Federation.