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This article seeks to determine the economic costs and consequences of implementing the Data Retention Directive (Directive 2006/24/EC), an extraordinary counter terrorism measure that mandates the a priori retention of communications data on every European citizen, by drawing on the insights of economic analysis. It also explores the monetary costs of the Directive on subscribers and communications service providers of Member States within the EU. Furthermore, it examines the implications of the Directive on the economic sector of the European Union, by focusing on the Directive’s impact on EU competitiveness and other EU policies such as the Lisbon Strategy. This analysis is motivated by the following questions: what are the monetary costs of creating and maintaining the proposed database for data retention? What are the effects of these measures on individuals? What obstacles arise for the global competitiveness of EU telecommunications and electronic communications service providers as a result of these measures? Are other policies in the European Union affected by this measure? If so, which ones?
