Thursday, August 4, 2022
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Meta threathens to shut down Facebook and Instagram in Europe

The social media giant warned that it might 'be unable to offer' some its 'most significant products and services'

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  • European regulators are currently re-working data regulations
  • Company said exit may be option if it couldn’t rely on rules

Meta Platforms Inc. has threatened to pull out Facebook and Instagram from Europe if it is unable to continue transmitting user data back to the United States, amid talks between authorities to replace a cancelled privacy accord.

Meta warned last Thursday in its annual report to the US Securities and Exchange Commission, the country’s financial regulator, that if no new framework is approved and the firm can no longer use the current model of agreements, it will most likely have to leave the continent.

According to Meta, processing user data across borders is critical for business and ad targeting.

“​If we are unable to transfer data between and among countries and regions in which we operate, or if we are restricted from sharing data among our products and services, it could affect our ability to provide our services, the manner in which we provide our services or our ability to target ads,” the statement read.

Meta clarified that it believes it will be able to achieve a new agreement this year, but stated that if it does not, “We will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe”.

Meta is unable to store European data on American servers due to data rules in Europe. This is a concern for the organization because user data is critical. Meta conducts commerce and ad targeting by transferring user data across borders.

The company is prohibited from collecting user data under European legislation such as the General Data Protection Regulation (GDPR). As a result, the corporation is having difficulty running its services across Europe. Meta has threatened to discontinue operating Instagram and Facebook in Europe.

“We have absolutely no desire and no plans to withdraw from Europe, but the simple reality is that Meta, and many other businesses, organisations and services, rely on data transfers between the EU and the US,” the Meta spokesperson said.

Previously, Meta could utilize the Privacy Shield data transfer framework as the legal basis for transatlantic data transfers. However, the European Court of Justice invalidated the pact in July 2020 due to data protection concerns. The EU’s highest legal body argued that the standard does not effectively protect the privacy of European residents.

As a result, US companies have been limited in their ability to transport European customer data to the US and have had to rely on SCCs (standard contractual clauses). The EU and the United States have stated that they are working on a new or updated version of the pact.

SourceBloomberg

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