The European Network and Information Security Agency (ENISA) will co-ordinate a network of specially created security agencies in each EU member state who will have unprecedented powers to demand data from public bodies and Internet companies, the Daily Mail reported.
British privacy laws have till now protected citizens from intrusion into their personal lives, but MPs and privacy-rights groups have warned that such new powers may pose a threat to individual security.
"This represents a dangerous escalation in the way that cyber security is being justified as a reason to monitor us all," Nick Pickles, director of privacy and civil liberties campaign group Big Brother Watch, was quoted as saying.
A spokesman for Britain's information commissioner said: "Any measures to improve cyber security should not be at the unnecessary expense of people's privacy."
Britain's own draft bill for surveillance of citizens, the Communications Data Bill, has come to a halt in the face of fierce opposition.
Now, information on National Health Service trusts, police forces, councils, Google and Facebook could be shared with other European agencies.
Under the European proposals, agents will be able to force disclosure of personal data where they suspect a company or public authority has been the victim of or is unable to prevent online hacking or any other cyber crime.