European eID Regulation aims to facilitate cross border transactions

To address this issue, the European Commission recently proposed framework for a European Digital Identity. The proposal aims to facilitate proof of identity and enable the sharing of electronic documents from a European Digital Identity app, referred to as a "wallet". If adopted, the system will allow citizens, residents, and businesses in the EU to access online services with their national digital identification, which will be recognised across all the Member States.

There are national digital ID schemes currently available in 14 EU countries, but with uneven results. While Estonia, for example, has pioneered the use of eID, the take-up of such services in other Member States has been low.

With the newly proposed framework, the Commission hopes to facilitate access to services across borders and remove hurdles to such acts as opening a bank account or renting an apartment in another Member State. This, in turn, should allow smaller companies to offer a wider range of services that require official identification.

Very large online platforms will be required to accept the use of European Digital Identity wallets, for example, for the purposes of age verification, but this should always be at the request of the user. In this way, the Commission hopes to reduce the number of instances in which recipients of online services are required to supply a range of personal data to access websites or log on to platforms.

An overall policy aim is to reduce the instances of online fraud and encourage consumer trust in e-commerce.

Background

The Commission's 2030 Digital Compass set out a number of targets and milestones, which it aims to realise by establishing a European Digital Identity. One goal is for all key public services to be available online by 2030, with all citizens having access to electronic medical records and 80 per cent of citizens using an eID solution.

This new eID initiative is built on the existing cross-border legal framework for trusted digital identities, the European electronic identification and trust services initiative (eIDAS Regulation), which was adopted in 2014. To recall, the eIDAS Regulation provides the basis for cross-border electronic identification, authentication and website certification within the Union. However, there is no requirement for Member States to develop a national digital ID or to make it interoperable with similar schemes in other Member States, so the system had a minimal effect across borders.

Therefore, the current proposal is designed to boost the framework's effectiveness, extend trusted digital identities to the private sector and make them mobile-friendly.

Elements of the new framework

Under the proposed Regulation, Member States will offer citizens and businesses apps, referred to as "digital wallets," that will be able to link their national digital identities with other personal documents such as a driving licence, diplomas or bank account). These wallets may be provided by public authorities or private entities but must be recognised by a Member State.

According to the Commission, the European Digital Identity will be:

• Available to all: Any EU citizen, resident, and business in the Union who would like to make use of the European Digital Identity will be able to do so;
• Widely useable: The European Digital Identity wallets will be useable widely as a way either to identify users or to prove certain personal attributes to access public and private digital services across the Union;
• Users in control of their data: The European Digital Identity wallets will enable people to choose which aspects of their identity, data and certificates they share with third parties and keep track of such sharing. User control ensures that only information that needs to be shared will be shared.

To speed up the eventual adoption of the new system, the Commission issued a Recommendation alongside the proposal. The Commission has invited Member States to establish a common "toolbox" by September 2022 and immediately start the necessary preparatory work. This toolbox should include the technical architecture and standards, as well as guidelines for best practices.

Next Steps

The Proposal for a European Digital Identity will now be discussed and amended by the European parliament, where Romana Jerkovic (S&D, Croatia) has been appointed rapporteur for the lead Committee on Industry, Research & Energy. In parallel, the Council will also hold discussions with a view to reaching a consensus on a final text. The EU plans to start testing the "digital wallet" in October 2022, if Member States have reached an agreement.

In parallel, the Commission will work with Member States and the private sector on technical aspects of the European Digital Identity. A number of projects in this field of e-government solutions have also been included in nation plans under the Recovery and Resilience Facility.

For further information contact Francine Cunningham

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