Meta Platforms struggles with the rather strict and unclear European privacy legislation. According to the recently released annual report, this could mean the end of services like Facebook and Instagram in Europe. How realistic is this scenario?
Meta must meet many conditions to store personal data of European users on American servers. Until recently, the multinational relied on the so-called Privacy Shield-agreement. This was an agreement between the European Union and the United States, so that American companies could correctly process personal data of Europeans.
The European Court rejected the Privacy Shield agreement in the summer of 2020. The reason was that the agreement did not meet the strict requirements of the General Data Protection Regulation (GDPR). In short, according to the Court, personal data in America is less well protected than in Europe.
Since this ruling, Meta and other American (tech) companies do not know exactly where they stand. There is not yet a new treaty, although the European Union and the United States are in talks about new privacy regulations for international data flows. These negotiations have been going on for about a year and a half now.
Serious threat or bluff poker?
Currently, Meta uses (temporary) model agreements to enable data transfer across the Atlantic Ocean. The parent company of Facebook and Instagram fears that those agreements will eventually be changed or will expire, while no successor to the Privacy Shield treaty has yet been prepared.
In that case, Meta, in its own words, may not be able to make a large part of its services available in Europe, including Instagram and Facebook. For advertising purposes and services, the exchange of personal data between different countries is a crucial factor, according to the American superpower.
Looking for a structural solution
Presumably, Meta just wants to put some pressure on the policymakers with the passages in question in its own annual report. Recently, the billion-dollar group announced that there are absolutely no concrete plans to leave Europe. In short, the soup is not eaten as hot as it is served. The financial interests are also far too great for that.
However, the parent company wants a structural solution in the short term to transfer personal data between the two continents in a lawful manner. Meta finds the current temporary model agreements too uncertain to serve as a basis for the exploitation of global services.
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