Facebook and Instagram’s services in Europe will end unless new transatlantic transfer rules on user data are established, Meta said in paperwork filed with the U.S. Securities and Exchange Commission.
The company told The Washington Times on Monday it does not want to leave Europe but that its paperwork filed with the SEC last week was intended to acknowledge the consequences of laws and regulations governing user-data transfers to the U.S.
Meta’s paperwork makes clear it will exit Europe if it is pushed out.
“If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on [Standard Contractual Clauses] 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, which would materially and adversely affect our business, financial condition, and results of operations,” read Meta’s 10-K filed with the SEC.
The data-transfer framework Facebook has operated under has changed in recent years. A July 2020 decision by the European Union’s top court invalidated a data transfer agreement with the U.S. amid European concerns that private data isn’t safe in the U.S., kickstarting the squeeze on Facebook.
Meta told the SEC that the Irish Data Protection Commission said in an August 2020 draft decision that transfers of people’s data from Europe to the U.S. should be suspended because Meta’s reliance on standard contractual clauses did not comply with European regulations.
A final decision from Europe about the standard contractual clauses Meta uses to transfer data could come “as early as the first half of 2022,” according to Meta’s paperwork.
Meta said Monday it does not have an exit strategy.
“We have absolutely no desire and no plans to withdraw from Europe, but the simple reality is that Meta, and many other businesses, organizations and services, rely on data transfers between the EU and the U.S. in order to operate global services,” a Meta spokesperson said in a statement.
The crackdown from European regulators comes as federal policymakers in the U.S. have also pursued proposals that would place new restrictions on Meta’s social networking behemoths, Facebook and Instagram.
Lawmakers are debating several plans that would change Facebook and Instagram’s businesses, including new antitrust policy, changes to legal liability protections pertaining to speech online, and guidelines for social media platforms offering their services to children.
Facebook reorganized as Meta in October 2021 and announced a shift toward metaverse products, focused on augmented and virtual reality experiences, over its social networking businesses.
The shift coincided with an unprecedented drop in users worldwide, as Meta reported last week that the number of people using Facebook daily declined nearly 500,000 people globally in 2021’s final three months.
The exodus from Facebook sent Meta’s stock tumbling, dropping 26% last Thursday alone and erasing more than $250 billion in market value, according to Bloomberg.
• Ryan Lovelace can be reached at rlovelace@washingtontimes.com.
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