CROSS-BORDER DATA FLOWS TAKING STOCK OF KEY POLICIES AND INITIATIVES OECD BACKGROUND REPORT FOR THE G7 DIGITAL AND TECHNOLOGY TRACK Germany 20222  This report was prepared by the Organisation for Economic Co -operation and Development (OECD) Directorate for Science, Technology and Innovation (STI) for the Federal Ministry for Economic Affairs and Climate Action, to inform discussions in the G7 Digital and Technol ogy Track under the auspices of the German G7 Presidency in 2022. The opinions expressed and arguments employed herein do not necessarily represent the official views of the member countries of the OECD or the G7. Acknowledgements The report was authored by Francesca Casalini of the OECD Digital Economy Policy Division, headed by Audrey Plonk, with contributions from Gallia Daor and David Gierten (OECD ), in co -ordination with Andreas Hartl , Alexander Wajnberg and Carl-Philipp Sassenrath of the German Federal Ministry for Economics and Climate Action and with the German 2022 G7 Presidency’s digital team in the German Federal Ministry for Digital and Transport. Many thanks to the German 2022 G7 Presidency and the working group members of the G7 Digital and Technology Track for their guidance in developing th e report and to OECD colleagues, Clarisse Girot ( Science, Technology and Innovation Directorate ), Javier López González (Trade and Agriculture Directorate), and Nejla Saula and Raffaella Centu relli (Global Relations and Co -operation Directorate) for valuable feedback in its finalis ation . This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international fro ntiers and boundaries and to the name of any territory, city or area. Cover image: © Martins Vanags/Shutterstock © OECD , 2022 The use of this work, whether digital or print, is governed by the Terms and Conditions to be found at http://www.oecd.org/termsandconditions.  3 Table of contents 1. Introduction 4 2. Unilateral policies and regulations 5 3. Inter -governmental processes 6 3.1 The G7 and G20 deliberations in the areas of Data Free Flow with Trust and cross -border data flows 7 3.2 Multilateral approaches 8 3.3 Regional arrangements 11 3.4 Preferential trade agreements 13 4. Technological and organisational measures 14 4.1 Data spaces 15 5. Conclusion 17 References 18 4  1. Introduction Over the past three decades, data access, sharing and use have become central drivers of economic growth and social well-being . Data, and in particular their transfer and sharing across borders, have become an integral part of every sector of the economy as well as a critical source of innovation for disruptive technologies such as the Internet of Things and Artificial Intelligen ce. However, the ubiquitous exchange of data across borders has amplified a range of conc erns for governments , businesses, and citizens, eroding trust among them. In response to this erosion of trust , policies and regulations addressing cross -border data flows are increasing. There are different reasons motivating countries to regulate cross -border data flows , often placing conditions o n its sharing abroad . One reason is to safeguard the privacy of individuals and their personal data. Co untries may also place conditions on the flow of data to ensure access by domestic authorities to data that are important for law enforcement or audit purposes. Conditions placed on cross -border data flows might also arise for the protection of information deemed to be sensitive from a security perspective. Lastly, some countries are using cross -border data regulation with a view to develop ing domestic capacity in digitally intensive sectors, as a form of digital industrial policy (OECD, 2020 [1]). However, th e resulting multi -layered landsca