Facebook parent company Meta has warned that it may have to withdraw products and services, including Facebook and Instagram, from Europe if it's prevented from transferring data from the EU to the US due to the lack of an international agreement.
The warning, issued in its annual report last week, was followed up by a statement from a Meta spokesperson on Monday that called for the two powers to establish "clear, global rules to protect transatlantic data flows over the long term."
Europe has strict privacy laws that provide protection to internet users across the European Union, but this poses a problem for US tech companies such as Meta. These companies rely on international data transfer agreements in order to transfer, store and process data at their data centers in the US. But because the US doesn't provide adequate protections for EU citizens against government snooping, the most recent data transfer agreement between the EU and US wasby a top European court.
Data transfers have been allowed to continue while a new agreement is hammered out thanks to a mechanism known as standard contractual clauses. But even this process is at risk, due to a ruling by the Irish data protection agency in August 2020. A final decision on the legality of using standard contractual clauses for data transfers is due is the coming months.
With the future of EU-US data transfers uncertain, Meta is concerned that it won't be able to rely on either standard contractual clauses or a new agreement to continue its operations. As a result, it warned in its annual report that it may "be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe."
"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 US in order to operate global services," said the company spokesperson.
Meta is far from the only company dealing with the uncertainty, although it may be among the biggest and most high profile. Many companies based in the US and EU, both big and small, are concerned about the future of data transfers and are keenly awaiting a new agreement that will ensure the future of their operations.