The European Parliament has voted to approve the Data Act, a contentious piece of legislation that includes a requirement that smart contracts be able to be terminated.

According to a press release issued on November 9, the legislation was approved by 481 votes to 31 against.

To become law, it must now be approved by the European Council, which consists of the leaders of the 27 European Union member states.

The adopted Data Act specifies that smart contracts "can be interrupted and terminated," as well as controls that allow functions to reset or stop the contract.

Critics of the Act have raised concerns about the smart contract clause, claiming that it is too broad and lacks specifics on when interruptions or terminations should occur.

According to an open letter sent in June by EU blockchain advocacy organizations and signed by dozens of crypto firms, the Data Act could result in smart contracts that use data from public blockchains like Ethereum being deemed illegal.

However, the European Commission has reportedly stated that the Data Act is unrelated to blockchain and that concerns that the Act would make smart contracts illegal are unfounded.

Sources:

https://cointelegraph.com/news/eu-backs-data-act-clause-shut-off-smart-contracts

https://www.europarl.europa.eu/news/en/press-room/20231106IPR09025/parliament-backs-plans-for-better-access-to-and-use-of-data

https://www.europarl.europa.eu/doceo/document/TA-9-2023-0385_EN.pdf

https://data-act.info/wp-content/uploads/2023/06/Open-Letter-About-Concerns-No-Logos-4.pdf

https://www.dlnews.com/articles/defi/polygon-criticises-eu-push-to-regulate-smart-contracts/