Data Protection Commissioner Billy Hawkes has said he will take no action against Facebook and Apple over allegations that the companies breached EU law.
He said the companies have nothing to answer for.
Mr Hawkes's office had been asked to investigate accusations that the companies handed over the personal data of millions of Europeans to national security organisations.
Both Apple and Facebook have their European headquarters in Ireland.
It follows revelations from whistleblower Edward Snowden that the US National Security Agency harvests emails and other private data from the companies under the Prism spy programme.
Mr Hawkes told RTÉ's Morning Ireland that the "Safe Harbour" agreement between the EU and US allows for such data to be exchanged.
He said: "There is an agreement at European level that there's free movement of personal data between the EU and the US, provided companies agree to come under the jurisdiction of enforcement bodies in the US.
"Irish law faithfully transposes European law in this area, it lays down very clearly that once there's been a decision that data can flow to different countries, then I am bound by that decision and that is why there is nothing to investigate by me in this case."
The Austrian-based campaign group Europe v Facebook wanted the Irish Data Protection Commissioner to take action against the two multinationals.
Mr Hawkes said they were fully compliant with EU data protection law.
Asked whether he thought a whole new regime was needed to govern the area of personal data exchange, Mr Hawkes said: "Something that everybody aims for is international agreements on data protection.
"We are in the murky world of what intelligence agencies do, so trying to get agreement is going to be very challenging.
"All democratic countries allow for law enforcement access to personal data in certain circumstances, so you cannot give an absolute guarantee (that personal data will not be used).
"What you can reasonably say is that if you're not doing anything out of the way, you should not expect to have your data accessed."