Meta might be considering shutting down Facebook and Instagram in Europe. This is coming after a new law in Europe that requires that data of users in the region to be kept and processed in Europe’s servers only.
It seems Meta is finding it difficult to comply with the new law. In a report submitted by Meta to the Securities and Exchange Commission, the company pointed out a scenario where it could shut down Instagram and Facebook in Europe.
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According to Meta, it can’t have user data kept and process in one region. Meta currently processes the data of its users across the US and Europe. The company said that data processing across continents is crucial for its business both for ad targeting and its operations.
So far, Meta has not been able to company with the new user data rules set up in Europe. Since the company is unable to comply with the new user data rules in Europe, Meta says can no longer offer good services in Europe (including Facebook and Instagram services).
According to a report submitted to Securities and Exchange Commission, Meta says:
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.
London-based CityAm also reached out to Meta for statement on the issue. Nick Clegg, VP of Global Affairs in Meta said the new user data rules in Europe could have bad effect on all business owners. He said, “The impact would be felt by businesses large and small, across multiple sectors.”
Clegg told CityAm, “While policymakers are working towards a sustainable, long-term solution, we urge regulators to adopt a proportionate and pragmatic approach to minimise 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.”
Across the world, lots of small, medium, and big business rely on Instagram and Facebook ads to grow their businesses. And shutting down the services of Facebook and Instagram in Europe could have effect on business not only in Europe but globally.
The report sent by Meta to SEC is meant to point out why the company finds it difficult to comply with the new user data rules. But, it’s also a nice way to share what Meta could do eventually if push comes to shove.
We don’t know if SEC will readjust or find a way to work with Meta on this issue. However, Meta has made its stand clear with the report the company just sent over to SEC.