Meta Platforms, Inc. threatened to pull two of its most popular platforms, Facebook and Instagram, out of Europe due to a recent European Union court ruling restricting how the company uses European users’ data to target online advertising.
Comments have been included in Meta Annual Financial Statement Form 10-K 2021filed with the US Securities and Exchange Commission (SEC) on February 2 by the company’s CFO David Wehner.
Facebook renamed to Meta October last year, in conjunction with CEO By Mark Zuckerberg efforts to build the platform’s “metaverse” and include many of the company’s broader social media platforms, including Instagram, Facebook Messenger, and WhatsApp.
Reasons for Meta’s threat to withdraw its platforms from Europe, as flagged by report by ITWire’s David M. Williamsto be Schrems II decision of the Court of Justice of the EU in July 2020.
The case dates back to 2011 when an Austrian lawyer named Maximillian Schrems analyzed 1,222 pages of information Facebook had collected about him and “discovered details that he believed he had deleted and that other details he did not agree to be shared.”
In Europe, Facebook is regulated by Ireland, which it chose for tax reasons, so Schrems filed a complaint there with the Irish data protection commissioner.
The court, Williams writes, has ruled that a US law that permits the collection of personal data from European Union subjects failed to provide “appropriate safeguards” for individual privacy individuals or “effective means of seeking to oppose the United States Government” and thereby not complying with the European General Data Protection Regulation (GDPR). Meta is continuing to challenge that ruling.
As part of their required disclosures, Meta’s Form 10-K (can be viewed here; The relevant section starting on page 8) lists factors that may affect their business and therefore their stock price.
In the section titled “Government Regulations,” Meta’s 2021 report notes that the company is “subject to a variety of laws and regulations in the United States and abroad regarding central issues in its business operations.” our business, many of which are still growing and are under court examination and could be construed in a way that harms our business,” and then listed various areas of regulation. including “privacy, data use, data and personal information protection, biometrics, encryption, right of publicity” and other privacy related issues.
The report continued, citing specifically how some of these laws and regulations, including those that “stipulate whether we may transfer, process and/or receive certain data that are critical to our operations.” our services, including data shared between the countries or regions in which we operate, and data shared between our products and services. ”
“If we are unable to transfer data between and between the countries and regions in which we operate, or if we are restricted from sharing data between our products and services, that may affect to our ability to provide services, the way we provide services, or our ability to target advertising, which may adversely affect our financial results,” the report said. statement, before leading to some sentences discussing about Schrems II The decision of the court of the European Union and specifically spells out the threat of a complete withdrawal from Europe:
If a new transatlantic data transmission framework is not adopted and we cannot continue to rely on SCCs or on other alternative means of data transmission from Europe to the United States, we will not may offer certain products and services, including Facebook and Instagram, in Europe, which will materially and adversely affect our business, financial condition and results of operations.
The report also notes that new or proposed laws and regulations in the United States and around the world “could significantly affect our business” by imposing compliance costs or causing they decided to recall other products. For example, a citation report might “[n]Electronic laws or regulatory decisions that limit our ability to collect and use information about minors “may be” as a result of[ing] within the limits of our advertising services or our ability to provide products and services to minors in certain jurisdictions. ”
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https://www.mediaite.com/tech/metas-latest-sec-filing-contains-a-threat-to-pull-facebook-and-instagram-from-europe-if-they-cant-keep-targeting-ads/ Meta threatens to pull Facebook out of EU if it can’t target ads