Meta Could Shut Down Facebook and Instagram in Europe Due to Data Sharing Ban with U.S.

Posted on February 7, 2022 by Laurent Giret in Social with 41 Comments

Meta is considering shutting down Facebook and Instagram in Europe if the company isn’t allowed to process data from European users in the U.S. The company made this pretty serious threat in its annual report for the Securities and Exchange Commission, where it addressed the “complex and evolving U.S. and foreign laws” that could “harm” Meta’s business.

In the report, the company emphasized the need to find a new transatlantic data framework to transfer data from European users to the U.S. after the Privacy Shield was invalidated by the Court of Justine of the European Union in July 2020. The current Standard Contractual Clauses (SCCs) that Meta currently uses for transatlantic data transfers are also under regulatory and judicial scrutiny in the EU.

“If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on 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, which would materially and adversely affect our business, financial condition, and results of operations,” Meta explained in the report.

It’s pretty hard to imagine Facebook and Instagram halting operations in the European Union, but the impossibility for Meta to transfer user data across regions would hurt the company’s ad targeting capabilities, and ultimately the company’s bottom line. To make things worse, Meta’s latest earnings reports also revealed that Facebook actually lost users for the first time in the company’s 18-year history.

In a statement shared with City A.M., Nick Clegg, Meta’s VP of Global Affairs and Communications reflected on the urgency of the situation. “While policymakers are working towards a sustainable, long-term solution, we urge regulators to adopt a proportionate and pragmatic approach to minimize disruption to the many thousands of businesses who, like Facebook, have been relying on these mechanisms in good faith to transfer data in a safe and secure way,” the exec said.

Tagged with , ,

Join the discussion!


Don't have a login but want to join the conversation? Become a Thurrott Premium or Basic User to participate

Comments (41)

41 responses to “Meta Could Shut Down Facebook and Instagram in Europe Due to Data Sharing Ban with U.S.”

  1. roundaboutskid

    Everyone in the rest of the world: ?

    Everyone in the EU: "Rejoice!"

  2. darfnix

    I'm wondering whether the EU laws also ban the storage of user data in Asia. If so, all those low-cost home automation devices should be banned too.

  3. red.radar

    I wonder if the issue is technical.... You would think a cloud company like Facebook would know who to link data from multiple sources...

    I wonder if the data is cached around the world for performance reasons.

    Or.... they really are doing something nefarious and violating EU laws.

    • david.thunderbird

      They are nefarious!

    • wright_is

      The data can only be stored and processed in the EU (or other territories with similar levels of data protection, including parts of South America, Japan and about half a dozen other countries, but not the USA), because SCCs and Privacy Shield have been shown to be null and void, because the US failed to implement their side of the bargain between 2016 and 2020.

      On top of that, they are breaking EU laws. For example, WhatsApp uploads the user's contacts to the Facebook mothership, which is illegal - they have to obtain the written permission of each contact in order to do that! Signal, for example, gets around this by using a hash of the contact's phone number, so that it can be compared when new users sign up, but the contact's name, address, email addresses etc. aren't uploaded and used for other purposes.

      • karlinhigh

        > a hash of the contact's phone number

        I'm pretty sure we discussed this before. But refresh my memory: phone numbers are a known pattern of digits, likely very easy to reverse the hash via Rainbow Tables. Does the hash really provide any data protection value?

        • wright_is

          It depends on the salt and the number of iterations, but, yes, it is a good method of obfuscation, and it is one way, you can’t take the hash and recreate the original number.

  4. stimshady

    Who even uses Facebook anymore. Lame.

    • bkkcanuck

      Old people still use it... maybe one day it will be the AOL of social media (past the prime, still existing but not important). Well, I can dream...

  5. david.thunderbird

    About face, book it...

  6. christianwilson

    Hmm. Nice. I'll talk to my wife about relocating to Europe.

  7. Jogy

    > the Privacy Shield was invalidated by the Court of Justine of the European Union in July 2020

    They have had a year and a half to try to comply and do data centers located in EU. Apparently, they chose not to, and now are trying to bully their way.

  8. owenm

    Good. Do it. Shut it down. Few people in Europe care

  9. nbplopes

    Don’t know if people will care that much. I could easily see Microsoft getting into the playfield quick….

  10. andy72

    Hello there from EU. I would just EFFIN love it. But Mark has no balls. Ballless it is? This is weird word with 3 consecutive L's. Since all I know is Euroenglish, I'll go for it!!!!

    @PAUL: 1200 episodes. Are you out of your mind. Or what.

    Sorry for that Euroenglish, you know how it is in U-rop.

  11. bkkcanuck

    Empty threat, but if they did... there would be quickly a replacement and Facebook and Instagram would not be able to recover market share when that happened. I would like to see them follow through on the threat...

  12. brettscoast

    The hypocrisy from a company that mines and manipulates users' data day in day out. Couldn't happen to a nicer bunch.

  13. skinnyjm

    Oh well...see ya later Mark!

  14. justme

    As nice as this sounds, I cant see this happening. Mark would be forced to give up the data of 300 million -ish users, and he's not about to do that willingly or easily regardless of the law.

    No, he'll kick and scream and squirm and throw his toys out of the cot trying to get his way. And the EU will smack him. And the world will applaud.

  15. jimchamplin

    Shoot 'em in the pocketbook with artillery.

  16. Bart

    Europe has never been this excited n its entire history

  17. Rik

    Meanwhile in the EU: "Don't threaten us with a good time."

    How empty of a demand is this even. They just saw 25% of the market value go up in smoke over losing .5 million users. And now they're demanding an exception on European privacy laws or otherwise they'll loose another 300 million users?

    • bkkcanuck

      Actually, it does not state the threat is really targeted at the EU (though I would like to see them 'forced' to carry through on the threat). Data cannot be hosted in the US because the US does not guarantee enough security to the data as per EU requirements that EU data can no longer be housed in the US. For Facebook it would be less damaging if the US just guaranteed EU data was protected as per EU requirements - if they had that treaty in place... it would solve the largest issue.

    • ontariopundit

      Don't forget that those 300 million users are highly profitable users from high income countries. Losing Europe would wipe out 90% of its value since it would allow a competitor to emerge.

      This would be the best thing that could happen for the health of democracy. As is, Facebook/Meta is probably as much of an existential threat to global liberal democracy as is the combination of the US Republican Party, working in concert with China and Russia.

      For that matter, it is Facebook that is allowing these actors to inflict the harm they do on the health of our democracies.

  18. navarac

    Good riddance to Facebook.

  19. oasis

    Please don't make promises you won't keep. Welcome to the site Laurent....

  20. wunderbar

    Yeah, there is zero chance this happens. Facebook is not going to give up 300 Million users and the revenue that brings.

    Everything is a negotiation.

  21. lwetzel

    Maybe they will shut down in the US also. I won't mind.

  22. LT1 Z51

    Sounds like it's time to build data centers in the EU and comply with EU law.

    The Internet does not give you the right to ignore other countries if you want to take money from their citizens. This is something I think the new (Post-Google) big tech like Meta needs to learn.

    • wright_is

      And if they really want to have a go at anyone, they should pound on the US Government, which has totally failed to fulfill its responsibilities with Safe Harbor, which was overturned because they failed to meet the requirements they had agreed to.

      So that was replaced by Privacy Shield, which the US Government totally failed to meet the requirements they had agreed to...

      And the EU even gave them nearly 6 years to comply, before declaring Privacy Shield null and void.

      But that isn't the real problem. If they have to comply with GDPR (whether that includes EU servers or a new EU-US agreement), the big problem is that they can't track users without their permission - and they must still be able to use the service, even if they refuse to be tracked, that is one of the requirements of GDPR and they can't sell or share user information with third parties.

      (Information about one's self that users post on Facebook is excepted, but tracked information or information that users post about other people, especially those that don't have a Facebook account, cannot be shared with others, either inside Facebook/Instagram or with third parties.)

  23. Daekar

    So... I don't really care one way or another about Facebook, but this seems an odd response to data sovereignty laws. I believe Microsoft has responded to this kind of requirement by simply building datacenters in locations that allow them to do what they need while still complying with the law. Is that right?

    • vladimir

      YEs, it's right and it's a huge competitive advantage that Microsoft has in the EU. At my work, sharepoint/onedrive are the only allowed cloud storage services that we are allowed to use for this reason

  24. RobertJasiek

    Has Meta not understood yet that it is not a legislature but actually does need to comply with laws to do business?

    • winner

      My hypothesis is that we're seeing an extension of Zuckerberg's personality here.

  25. vladimir

    Wow... I guess we will see a migration wave of smart people to the EU if Meta holds up to their threat

  26. simont

    This is the first time that Facebook usage number have dropped, so I can't really see Meta/Facebook shutting down in Europe which means 300+ million users would loose access. That would really kill their stock price. It is an empty threat

  27. ruivo

    "We have your daughter. Enclosed on this box is a severed ear. It is mine. Pay us or tomorrow I'll cut my other ear!"