Meta could be forced to shut down Facebook and Instagram in Europe, here’s why

Can you live in a world without Facebook and Instagram?

Highlights
  • Meta’s latest annual filing suggests that the company might have to shut down its operations in Europe.
  • The statement comes after EJC annulled the EU-US Privacy Shield, which allowed American companies to host the data gathered from Europe on American servers.
  • But, with no transatlantic data transfers between the US and Europe, Facebook has threatened to shut down Facebook and Instagram in Europe since it would affect operation and ad-targeting.

Can you imagine your life without Facebook or Instagram? Well, seems like Europeans should give it a thought as Meta (formerly known as Facebook) might have to shut down Facebook and Instagram in Europe. But why? According to this year’s annual report filed by Meta to Securities and Exchange Commission, the company might have to shut down Facebook and Instagram in the European region if it fails to comply with the recent EU regulations. 

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What are these new EU regulations? Remember the EU–US Privacy Shield? Well, that was European Justice Court declared the Privacy Shield invalid last year due to privacy violation concerns. Under the EU-US Privacy Shield, American companies operating in Europe were allowed to keep and process the European user’s data on servers based in the US. However, now the EU forbids such practice, meaning companies will have to keep and process the data on servers located in the European region. But, Meta (or Facebook) is not in favour of this new regulation, and that’s why it’s threatening to shut down two of the biggest social media networks – Facebook and Instagram in Europe. 

Meta says that transatlantic data transfers between the US and Europe are important for operations and ad-targeting. And with new changes to the “Privacy Shield” in effect, Meta can’t do that anymore. Because of that, the company won’t be able to offer its’ most significant products and services in Europe, which obviously includes Facebook and Instagram.

“​If we are unable to transfer data between and among countries and regions in which we operate, or if we are restricted from sharing data among our products and services, it could affect our ability to provide our services, the manner in which we provide our services or our ability to target ads,” the statement reads.

Meta expects to reach a new agreement with the European Union this year. And here’s what Meta has to say if things don’t fall in Meta’s favour, “we will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe.”

CityAM, a London-based financial newspaper, reached out to Facebook to clear things up. Reverting to the CityAM, NMick Clegg, Meta’s VP of Global Affairs and Communications, said, “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.”

Recently, Meta’s shares plummeted by 25%, one of the biggest in US history. Meta lost $251 billion in value soon after the company reported a drop in Facebook’s active user base, saying it’s facing stiff competition from rivals like TikTok.