Shutdown threat by Meta to Facebook

The shutdown threat by meta to Facebook and Instagram in Europe is becoming very serious.

Meta (The company formerly known as Facebook) is threatening to pull its social networks Facebook and Instagram out of the EU if regulators won’t let it process personal user data in both Europe and the US. The company is making this clear in a report to the US Securities and Exchange Commission (via Pocketnow).

The issue comes down to European data regulations that prevent Meta, the company formerly known as Facebook, from transferring, storing, and processing Europeans’ data on US-based servers.

In its annual report to the US Securities and Exchange Commission, the country’s financial authority, Meta warned that if no new framework is adopted and the company could no longer use the current model of agreements it would probably have to walk away from the continent.

The reason for the shutdown threat by meta to Facebook are:

Meta could previously use a data transfer framework called Privacy Shield as the legal basis to carry out transatlantic data transfers. But In July 2020, the European Court of Justice annulled the treaty due to violations of data protection. The bloc\’s highest legal authority argued the standard does not adequately protect European citizens’ privacy.

As a result, US companies were restricted in sending European user data to the US and have had to rely on SCCs (standard contractual clauses) which leads to the shutdown threat by meta to Facebook and Instagram.

Interestingly, the company isn’t mentioning its encrypted messenger WhatsApp as an argument. While the service could be implicitly meant with the “including Facebook and Instagram” language in the statement, it would seem weird that the company wouldn’t use WhatsApp as additional leverage since it’s pretty much the de-facto messaging standard in many EU countries. Given the encrypted nature of WhatsApp and a lack of advertisements within the service, it’s possible that decoupling European and American data just wouldn’t make much of an impact on the company’s bottom line.

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