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Fact-check: Is the EU digital identity wallet going to strip away our privacy?

European Commissioner for Internal Market Thierry Breton speaks during a media conference at EU headquarters in Brussels, Thursday, June 3, 2021.
European Commissioner for Internal Market Thierry Breton speaks during a media conference at EU headquarters in Brussels, Thursday, June 3, 2021. Copyright Stephanie Lecocq/AP
Copyright Stephanie Lecocq/AP
By James Thomas
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The EU's new digital identity wallet, designed to streamline personal information storage and sharing, has raised concerns and conspiracy theories. The Cube takes a look at them.

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The EU’s incoming digital identity wallet has sparked claims on social media and by politicians that Brussels intends to strip away citizens’ privacy and exert control over their lives.

The wallet, which is still in the pipeline, is an app that will let users store key information like official ID and bank details in a single, secure place. It will allow citizens, residents and businesses to prove their identity to access public and private services across Europe.

The European Commission states that the wallet will provide a simple and safe way to control how much information people wish to share with services that ask for personal data, taking control of one’s data from large organisations and giving it back to the individual.

“Every time an app or website asks us to create a new digital identity or to easily log on via a big platform, we have no idea what happens to our data in reality,” European Commission President Ursula von der Leyen said when unveiling the wallet in her 2020 State of the Union address.

“That is why the Commission will propose a secure European e-identity. One that we trust and that any citizen can use anywhere in Europe to do anything from paying your taxes to renting a bicycle,” she added. “A technology where we can control ourselves what data is used and how.”

Yet despite this, many have taken to social media to voice their fears: some with legitimate concerns, and others with bizarre theories.

Even though the EU has assured that the wallet’s users will have full control over which information is shared and with whom, some say it will strip citizens of their freedom and privacy.

Others say Brussels plans to use the wallet to deny people rights and control them.

The Cube put some of the claims to experts to see what they made of them.

Will the wallet strip away our privacy?

First, we asked whether the wallet is likely to constitute a privacy breach, based on fears that so much personal data will be stored on a single app.

Lilly Schmidt, research associate and programme lead at the Digital Society Institute at the European School of Management and Technology in Berlin, said that the true aim of the wallet is to enhance our privacy, not undermine it.

“I get where [the fear] comes from because the fear of a state solution in general or the trust in governments is always hard to obtain, especially in the digital world,” she said. “But actually what the regulation is trying to do is really to get rid of the ‘black box’ and to enhance transparency.”

Professor Bart Jacobs at Radboud University Nijmegen took a more cautious approach, noting that identity wallets can be “both good and bad for our privacy”. He said that, when you want to watch an age-rated film online, for example, it’s more privacy-friendly to use your wallet to only disclose your age, rather than upload a copy of your passport to confirm how old you are.

“That’s why I argue in favour of tough supervision for this kind of new technology,” said Jacobs, who is one of the people behind Yivi - a similar digital identity app in the Netherlands. “It’s against the law to abuse these kinds of systems, but the law should be maintained.”

It’s also important for citizens to be informed on the subject so that they fully understand the consequences of data sharing, according to experts.

Sanna Toropainen, doctoral researcher at the University of Helsinki, noted that GDPR, the EU’s landmark data protection regulation, gives individuals the right to delete their data, but only in certain situations.

“For instance, when the public authority processes personal data for a legal obligation, you don’t have the right to delete data,” she said. “So, while the wallet does not 'hollow out or strip away our privacy', it places the so-called regulatory burden in our hands, and we need to be educated enough to use the wallet so that we know what happens to our data after we share it and what are our rights.”

Will we be at the mercy of big business and governments?

Another accusation levied against the digital wallet is that it will make EU citizens powerless against large corporations and governments that will farm their data.

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Experts highlighted the importance of consent, and that ultimately whether to share personal data or not is up to citizens, rather the establishment.

“Consent is a weak mechanism because people can be pressured,” Jacobs said. “So it’s, in the end, a limited form of protection, but it’s certainly not the case that people are powerless in these situations.”

Schmidt also noted that citizens will be able to see how their data is being used, withdraw their consent if they see any misuse and report it to the authorities. She added that the wallet legislation is still being worked on so might yet provide additional protections.

Regardless, the EU digital identity wallet will provide an alternative to the likes of Meta or Google’s login systems, according to Toropainen. She said that while these are convenient, the companies remain in control of your data and you don’t know exactly how it will be used.

“With EU digital identity wallet, you can log into Facebook and alike, knowing what data is shared as it is stipulated in the regulation,” she said.

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Toropainen added however that a potential downside of the wallet is that you will not be able to stay fully anonymous when using it, as it will be linked to your legal identity and so your name will be shared along with any other information you hand over.

Is Europe heading toward Chinese-style social credit system?

Other social media users have asserted that the EU digital identity wallet is a step away from China’s controversial social credit system, which gives individuals, businesses and government entities a credit score based on their trustworthiness.

This trustworthiness is based on one’s social behaviour and is regulated through actions such as paying bills on time and abiding by the law.

Schmidt said it’s normal that people might feel a degree of fear when governments introduce new technological solutions, but once again assured that the EU digital identity wallet is a case of the government handing the control of data from itself over to citizens.

“So in that sense, it’s almost the opposite direction from the Chinese credit system,” she said.

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Jacobs voiced a similar opinion, arguing that the idea the EU digital identity wallet is akin to a social credit system has no basis.

“China’s social credit system is of a totally different order and requires really the kind of political decision that I don’t think we’re ready in Europe to take,” he said. “And of course, wallets could be used for such technology. But ordinary passports can also be used for such technology. So I think they are fairly independent issues.”

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