Facebook, Instagram may exit EU due to data regulations

Meta is also concerned with the data privacy regulations in India, where it could be required to store and process data locally, according to the filing.

February 08, 2022 02:48 pm | Updated February 09, 2022 11:20 am IST

A woman holds smartphone with Facebook logo in front of a displayed Facebook's new rebrand logo Meta in this illustration picture

A woman holds smartphone with Facebook logo in front of a displayed Facebook's new rebrand logo Meta in this illustration picture

Meta Platforms Inc. may pull out Facebook and Instagram from EU region as the duo struggle with data privacy regulations in Europe.

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"If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on Standard Contractual Clauses (SCCs) or rely upon other alternative means of data transfers from Europe to the United States, we will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe," Meta said in its annual filing with the Securities and Exchange Commission.

The company is being challenged by evolving rules and regulations that dictate whether, how, and under what circumstances they can transfer data that is critical to their operations, Meta said in the filing.

This includes data shared between countries or regions in which they operate and data shared between their products and services.

Such restrictions can affect our ability to provide our services, Meta said.

Some bases upon which Meta relies to transfer such data, like SCCs, have been subjected to regulatory and judicial scrutiny.

In August 2020, the Irish Data Protection Commission (IDPC) considered Meta Platforms Ireland's reliance on SCCs in respect of European user data does not achieve compliance with the General Data Protection Regulation (GDPR) and proposed that such transfers of user data from the European Union to the United States should be suspended.

Meta expects a final decision in this inquiry in the first half of 2022.

The GDPR includes operational requirements for companies that receive or process personal data of residents of the European Union that are different from those previously in place in the European Union.

It requires submission of personal data breach notifications to the European Union privacy regulator, the IDPC, and includes significant penalties for non-compliance.

The Privacy Shield, a transfer framework that Meta relied on for data transferred from the European Union to the United States, was invalidated in July 2020 by the Court of Justice of the European Union (CJEU).

However, Meta said that is not wanting or “threatening” to leave Europe.

"We have absolutely no desire to withdraw from Europe; of course we don’t. But the simple reality is that Meta, like many other businesses, organisations and services, relies on data transfers between the EU and the US in order to operate our global services," Meta said in a blog.

"We disclosed that continuing uncertainty over EU-US data transfers mechanisms poses a threat to our ability to serve European consumers and operate our business in Europe."

Also Read | Google calls for a new EU-US data transfer set-up to secure data flow

Meta is also concerned with the data privacy regulations in India, where it could be required to store and process data locally, according to the filing.

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