Safe harbor
Encyclopedia
The term safe harbor has several special usages, in an analogy
with its literal meaning, that of a harbor
or haven which provides safety
from weather
or attack.
or a regulation that reduces or eliminates a party's liability
under the law, on the condition that the party performed its actions in good faith
or in compliance with defined standards. Legislators may include safe-harbor provisions to protect legitimate or excusable violations, or to incentivize the adoption of desirable practices.
An example of safe harbor is performance of a Phase I Environmental Site Assessment
by a property purchaser: thus effecting due diligence
and a "safe harbor" outcome if future contamination is found caused by a prior owner.
Another example is regarding insider information laws
. Broker-dealer
s are required to have in place Chinese wall
s (also called information barriers) that prevent the transmission of insider information from one department to another. Each broker-dealer firm is required to have its own barriers and to enforce them on its own. Thus, there is no safe harbor regarding this issue.
A third example can be found in the EU Data Protection Directive, which sets comparatively strict privacy protections for EU citizens. It prohibits European firms from transferring personal data to overseas jurisdictions with weaker privacy laws, but creates exceptions where the overseas recipients have voluntarily agreed to meet EU standards under the Directive's Safe Harbor Principles
.
, particularly in the United States of America, the term safe harbor can refer to the hours during which broadcasters may transmit material deemed indecent for children. This "safe harbor", enforced by the Federal Communications Commission
, extends—legally—from 10 PM to 6 AM.
consequences than follow the precise requirements of their respective tax codes.
Analogy
Analogy is a cognitive process of transferring information or meaning from a particular subject to another particular subject , and a linguistic expression corresponding to such a process...
with its literal meaning, that of a harbor
Harbor
A harbor or harbour , or haven, is a place where ships, boats, and barges can seek shelter from stormy weather, or else are stored for future use. Harbors can be natural or artificial...
or haven which provides safety
Safety
Safety is the state of being "safe" , the condition of being protected against physical, social, spiritual, financial, political, emotional, occupational, psychological, educational or other types or consequences of failure, damage, error, accidents, harm or any other event which could be...
from weather
Weather
Weather is the state of the atmosphere, to the degree that it is hot or cold, wet or dry, calm or stormy, clear or cloudy. Most weather phenomena occur in the troposphere, just below the stratosphere. Weather refers, generally, to day-to-day temperature and precipitation activity, whereas climate...
or attack.
Legal definition
A safe harbor is a provision of a statuteStatute
A statute is a formal written enactment of a legislative authority that governs a state, city, or county. Typically, statutes command or prohibit something, or declare policy. The word is often used to distinguish law made by legislative bodies from case law, decided by courts, and regulations...
or a regulation that reduces or eliminates a party's liability
Legal liability
Legal liability is the legal bound obligation to pay debts.* In law a person is said to be legally liable when they are financially and legally responsible for something. Legal liability concerns both civil law and criminal law. See Strict liability. Under English law, with the passing of the Theft...
under the law, on the condition that the party performed its actions in good faith
Good faith
In philosophy, the concept of Good faith—Latin bona fides “good faith”, bona fide “in good faith”—denotes sincere, honest intention or belief, regardless of the outcome of an action; the opposed concepts are bad faith, mala fides and perfidy...
or in compliance with defined standards. Legislators may include safe-harbor provisions to protect legitimate or excusable violations, or to incentivize the adoption of desirable practices.
An example of safe harbor is performance of a Phase I Environmental Site Assessment
Phase I Environmental Site Assessment
In the United States, an environmental site assessment is a report prepared for a real estate holding which identifies potential or existing environmental contamination liabilities. The analysis, often called an ESA, typically addresses both the underlying land as well as physical improvements to...
by a property purchaser: thus effecting due diligence
Due diligence
"Due diligence" is a term used for a number of concepts involving either an investigation of a business or person prior to signing a contract, or an act with a certain standard of care. It can be a legal obligation, but the term will more commonly apply to voluntary investigations...
and a "safe harbor" outcome if future contamination is found caused by a prior owner.
Another example is regarding insider information laws
Securities regulation in the United States
Securities regulation in the United States is the field of U.S. law that covers various aspects of transactions and other dealings with securities...
. Broker-dealer
Broker-dealer
A broker-dealer is a term used in United States financial services regulations. It is a natural person, a company or other organization that trades securities for its own account or on behalf of its customers....
s are required to have in place Chinese wall
Chinese wall
In business, a Chinese wall or firewall is an information barrier implemented within a firm to separate and isolate persons who make investment decisions from persons who are privy to undisclosed material information which may influence those decisions...
s (also called information barriers) that prevent the transmission of insider information from one department to another. Each broker-dealer firm is required to have its own barriers and to enforce them on its own. Thus, there is no safe harbor regarding this issue.
A third example can be found in the EU Data Protection Directive, which sets comparatively strict privacy protections for EU citizens. It prohibits European firms from transferring personal data to overseas jurisdictions with weaker privacy laws, but creates exceptions where the overseas recipients have voluntarily agreed to meet EU standards under the Directive's Safe Harbor Principles
Safe Harbor Principles
US-EU Safe Harbor is a streamlined process for US companies to comply with the EU Directive 95/46/EC on the protection of personal data.Intended for organizations within the EU or US that store customer data, the Safe Harbor Principles are designed to prevent accidental information disclosure or loss...
.
Broadcasting
In broadcastingBroadcasting
Broadcasting is the distribution of audio and video content to a dispersed audience via any audio visual medium. Receiving parties may include the general public or a relatively large subset of thereof...
, particularly in the United States of America, the term safe harbor can refer to the hours during which broadcasters may transmit material deemed indecent for children. This "safe harbor", enforced by the Federal Communications Commission
Federal Communications Commission
The Federal Communications Commission is an independent agency of the United States government, created, Congressional statute , and with the majority of its commissioners appointed by the current President. The FCC works towards six goals in the areas of broadband, competition, the spectrum, the...
, extends—legally—from 10 PM to 6 AM.
Commerce
- In the context of commercial takeovers, safe harbors function as a form of shark repellentPoison pillA shareholder rights plan, colloquially known as a "poison pill", or simply "the pill" is a type of defensive tactic used by a corporation's board of directors against a takeover...
used to thwart hostile takeovers. Under implementation of this provision, a target company will acquire a troublesome firm in order to raise the acquisition price and make acquisition by other parties economically unattractive.
- The Private Securities Litigation Reform ActPrivate Securities Litigation Reform ActThe United States Private Securities Litigation Reform Act of 1995, Pub. L. 104-67, 109 Stat. 737 implemented several substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation, and...
of 1995 includes safe-harbor provisions to protect companies which make financial and investment forecasts in public markets.
- The United States Department of CommerceUnited States Department of CommerceThe United States Department of Commerce is the Cabinet department of the United States government concerned with promoting economic growth. It was originally created as the United States Department of Commerce and Labor on February 14, 1903...
runs a certification program which it calls Safe Harbor and which aims to harmonize data privacyData privacyInformation privacy, or data privacy is the relationship between collection and dissemination of data, technology, the public expectation of privacy, and the legal and political issues surrounding them....
practices in trading between the United States of America and the stricter privacy controls of the European UnionEuropean UnionThe European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
Directive 95/46/EC on the protection of personal dataDirective 95/46/EC on the protection of personal dataThe Data Protection Directive is a European Union directive which regulates the processing of personal data within the European Union...
. For more information, see Safe Harbor PrinciplesSafe Harbor PrinciplesUS-EU Safe Harbor is a streamlined process for US companies to comply with the EU Directive 95/46/EC on the protection of personal data.Intended for organizations within the EU or US that store customer data, the Safe Harbor Principles are designed to prevent accidental information disclosure or loss...
.
- The Public Health Service publishes a set of Safe Harbor rules within Title 42, Code of Federal Regulations, to preclude Life Science companies from withholding important medical information from the public for fear of being prosecuted for Medicare violations. It is illegal for a firm to advertise or promote a drug, biologic, or medical device for a purpose other than an indication approved by the Food and Drug AdministrationFood and Drug AdministrationThe Food and Drug Administration is an agency of the United States Department of Health and Human Services, one of the United States federal executive departments...
; recommending such off-label use for a product subject to reimbursement under Medicare or Medicaid constitutes felony fraud. Safe Harbor establishes rules defining when and how such information may be published (for example, medical journal reports of clinical trials) without the company running afoul of advertising and marketing restrictions.
Internet
- The Digital Millennium Copyright ActDigital Millennium Copyright ActThe Digital Millennium Copyright Act is a United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization . It criminalizes production and dissemination of technology, devices, or services intended to circumvent measures that control access to...
has notable safe-harbor provisions which protect Internet service providerInternet service providerAn Internet service provider is a company that provides access to the Internet. Access ISPs directly connect customers to the Internet using copper wires, wireless or fiber-optic connections. Hosting ISPs lease server space for smaller businesses and host other people servers...
s from the consequences of their users' actions (Similarly the EU directive on electronic commerce provides a similar provision of "mere conduit" which while not exactly the same, serves much the same function as the DMCA safe harbor in this instance). - The US Patent and Trademark Briefing on ISP Liability states that in order to be eligible for safe harbor the ISP must have adopted and reasonably implemented a policy that provides for the termination in appropriate circumstances of subscribers and account holders of the service provider’s system or network who are repeat infringers.
- DigitalRights provides a service to copyright owners to monitor ISPs compliance with their safe harbor eligibility.
Accounting
In accounting, the term safe harbor may refer to the method by which corporations would rather (typically) incur taxTax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...
consequences than follow the precise requirements of their respective tax codes.
See also
- Safe harborResearch exemptionIn patent law, the research exemption or safe harbour exemption is an exemption to the rights conferred by patents, which is especially relevant to drugs...
in patentPatentA patent is a form of intellectual property. It consists of a set of exclusive rights granted by a sovereign state to an inventor or their assignee for a limited period of time in exchange for the public disclosure of an invention....
law - The EU International Safe Harbor Privacy Principles
- No-action letterNo-action letterA no-action letter is a letter written by the staff members of a government agency, requested by an entity subject to regulation by that agency, indicating that the staff will not recommend that the agency take legal action against the entity should the entity engage in a course of action proposed...
in US regulation - Safe Harbor Certified SeafoodSafe Harbor Certified SeafoodSafe Harbor Certified Seafood is the first brand developed under San Rafael, California based Micro Analytical Systems, Inc. . Seafood bearing the Safe Harbor seal is tested for overall mercury content to be under the FDA's action level of 1ppm, histamine, Escherichia coli O157:H7 and salmonella...
External links
- 2000/520/EC: Commission Decision of 26 July 2000 pursuant to Directive 95/46/EC of the European Parliament and of the Council (Safe harbor principle)
- The Electronic Commerce (EC Directive) Regulations 2002- Section 17 "Mere Conduit"
- Safe Harbor Arrangement Official site