TheChek News Flow

Mark Zuckerberg and team consider shutting down Facebook and Instagram in Europe if Meta can not process Europeans’ data on US servers

If Meta is not given the option to transfer, store and process data from its European users on US-based servers, Facebook and Instagram may be shut down across Europe, the social media giants’ owner reportedly warned in its annual report.

The key issue for Meta is transatlantic data transfers, regulated via the so-called Privacy Shield and other model agreements that Meta uses or used to store data from European users on American servers. The current agreements to enable data transfers are currently under heavy scrutiny in the EU.

In its annual report to the U.S. Securities and Exchange Commission, Meta warns that if a new framework is not adopted and the company is no longer allowed to use the current model agreements “or alternatives,” the company will “probably” no longer be able to offer many of its “most significant products and services,” including Facebook and Instagram, in the EU, according to various media reports, including in iTWire, The Guardian newspaper and Side Line Magazine.

Sharing data between countries and regions is crucial for the provision of its services and targeted advertising, Meta stressed.

Therefore, it previously used the transatlantic data transfer framework called Privacy Shield as the legal basis to carry out those data transfers.

However, this treaty was annulled by the European Court of Justice in July 2020, because of data protection violations. Since then, the EU and the US did stress they are working on a new or updated version of the treaty.

READ MORE

Mysterious Covid variant BA.2 spreads like lightning into over 40 countries but Omicron acts as ‘super booster’ to new coronavirus mutation

In addition to the Privacy Shield, Meta also uses so-called model agreements, or Standard Contractual Clauses, as the primary legal basis for processing data from European users on American servers.

These model agreements are equally under scrutiny in Brussels and other parts of the EU.

Facebook response

When contacted by City A.M. today, John Nolan, Meta’s London-based tech media and advertising communications leader, did not deny or play down the reports.

Instead, he shared a statement from Nick Clegg, Meta’s VP of Global Affairs and Communications.

Clegg warned that “a lack of safe, secure and legal international data transfers would damage the economy and hamper the growth of data-driven businesses in the EU, just as we seek a recovery from Covid-19.”

“The impact would be felt by businesses large and small, across multiple sectors,” he continued.

“Businesses need clear, global rules, underpinned by the strong rule of law, to protect transatlantic data flows over the long term.”

Nick Clegg, VP of Global Affairs and Communications.

“In the worst case scenario, this could mean that a small tech start up in Germany would no longer be able to use a US-based cloud provider. A Spanish product development company could no longer be able to run an operation across multiple time zones.”

Weekend Papers Summary

NEW YORK TIMES

-More than 2,600 Americans are dying from Covid-19 each day, with the virus claiming a total of more than 900,000 lives across the United States. But simultaneously, new case reports and hospitalizations are waning, leaving many wondering what long-term coexistence with the virus might look like. New York City’s Hospitals Withstood the Omicron Surge. Vaccines and a milder variant helped, but health care workers also learned from hard-won experience in 2020 how to limit severe illness and death.

-Protesters against vaccine mandates and other Covid measures have paralyzed Ottawa for a week and are expected in Toronto and Quebec City. President Erdogan of Turkey tested positive two days after meeting Ukraine’s president.

-The Islamic State is a shadow of its former self. But it’s likely to keep adapting and enduring, even after the U.S. raid that killed its top commander.

-Martial Simon, mentally ill and homeless, spent years in and out of hospitals before being accused of shoving Michelle Go in front of a subway train in New3 York City last month.

-The environmentally unfriendly secret of winter sports is that many competitions take place on artificial snow. China’s water-scarce capital had to go to enormous lengths to make enough of it.

-Roger Ailes understood the appeal Mr. Trump had for Fox viewers. He didn’t foresee how together they would redefine the limits of political discourse.

-A declining birthrate and pandemic deaths helped drive US population growth to historic lows. But immigration appears to be back on the rise.

-Many countries competing in the Africa Cup of Nations are enduring security, economic and political crises, but the tournament offers visions of unity, solidarity and joy.

-Lawmakers press Amazon on sales of chemical used in suicides even as grieving families tried to warn Amazon and other e-commerce sites of the danger, there were more purchases and more deaths.

THE FINANCIAL TIMES

-Investors have rushed into the derivatives market to protect corporate bond portfolios from a possible sell-off, as they grapple with the growing risk that the recent slump in stock prices will spread to companies’ debt.

-Fundraising figures released this week underline the continuing political potency of the Trump brand. According to the filings, Trump’s political operation and affiliated political action committees, or super-PACs which raise money for political causes, now have more than $143M of cash in hand after hauling in $64M in the second half of last year.

-US military and intelligence officials believe that Russia is planning to hold a big nuclear weapons exercise this month as a warning to Nato not to intervene if President Vladimir Putin decides to invade Ukraine.

-Nike and Amazon are separately evaluating bids for Peloton, which has come under fire from an activist investor who has urged the board of the maker of connected fitness bikes and treadmills to sack its chief executive and explore a sale.

-The painful start to the year for global equities has knocked the performance of many star stockpickers, with Facebook parent Meta’s disappointing results this week deepening the pain in some technology stocks. Among those nursing outsized losses is William Danoff. His $131bn Fidelity Contrafund — one of the investment industry’s largest traditional, actively managed equity funds — was down over 11 per cent for 2022 as of Thursday’s close, after shares in Facebook owner Meta, its biggest bet, fell by a quarter in a single day.

-British Prime Minister Boris Johnson was braced for further departures of senior aides from his Downing Street team on Friday as some government ministers were said to be considering their position.

-Earlier this week, Heather Boushey and other members of US president Joe Biden’s economic team warned that the Omicron variant might have temporarily depressed employment, and therefore the January jobs report should be taken with a pinch of salt.

But when the data landed on Friday morning, with payrolls surging above expectations in addition to large revisions to previous months, it served both as a sign of the resilience of the recovery and a vindication of Biden’s economic record.

-Gerhard Schröder, the former German chancellor, has been nominated to join the board of Russian energy giant Gazprom, fuelling scrutiny of his close links to the Kremlin-controlled company as tension mounts between Moscow and the Wst over whether Russia is preparing to invade Ukraine.

THE NEW YORK POST

-The soft-on-crime approach espoused by Manhattan District Attorney Alvin Bragg and other progressive prosecutors in troubled Democratic cities has been nurtured and advanced by a policy center at John Jay College of Criminal Justice, no less. The public college in Hell’s Kitchen, where many future cops are educated, is home to the Institute for Innovation in Prosecution, which since 2016 — with the help of controversial figures such as Chicago prosecutor Kim Foxx, Los Angeles DA George Gascón and San Francisco’s Chesa Boudin — has been instrumental in reshaping how prosecutors across the country view crime and punishment.

- One month before the application deadline, the Department of Education unveiled its long-awaited new admission system, lowering the bar for entry into many competitive high schools — and tossing kids with a range of academic achievement into a random hopper. “It’s now essentially a lottery system masquerading as a selective process,” said Effie Zakry, a vice-president of the Citywide Council on High Schools, a DOE parental advisory body.

- A day after Facebook owner Meta suffered the deepest loss of stock market value in history for a US company, Amazon logged the greatest ever one-day increase in value. FB Shares surged 13.5% on Friday following its blowout quarterly report.