Multiple media reports, citing sources, indicate that Meta, the parent company of Facebook, is set to face a fine exceeding $800 million. The fine is reportedly being imposed due to Meta’s failure to comply with a warning issued by the top European Union (EU) court regarding the transfer of data of Facebook’s EU users to servers in the United States.
The reason behind the fine stems from Meta’s disregard of a court warning aimed at safeguarding users’ data from being accessed by US security services once it is transferred to servers across the Atlantic. Ireland’s Data Protection Commission, as per an anonymous source cited by Bloomberg, is expected to penalize the social media giant.
Reports suggest that Ireland’s data protection watchdog will confirm the fine on Monday and is likely to halt the transfer of data from Facebook’s European users to the US. Additionally, the court may demand that Facebook ceases using standard contract clauses, a legal mechanism employed to transfer EU data to the US, according to Politico.
Sources have informed Reuters that the penalty will surpass the previous record fine imposed on Amazon, which amounted to $821 million (746 euros). Luxembourg imposed this fine on Amazon in 2021 for similar violations of EU privacy standards.
The impending decision is said to have been prompted by the revelations made by Edward Snowden, a former US National Security Agency contractor, in 2013, as well as a legal challenge initiated by Austrian privacy campaigner Max Schrems. Schrems has expressed concerns about the lack of adequate protection for European users’ data from US intelligence agencies, particularly after Snowden disclosed that officials had repeatedly accessed individuals’ information through tech companies like Facebook and Google.
Schrems’ lawsuit instigated a decade-long legal battle over the legality of transferring EU data to the US. EU regulators, led by Ireland’s Data Protection Commissioner Helen Dixon, have been finalizing the ban on a legal tool used by Facebook for transferring European user data, as per Reuters. In April, the Irish Data Protection Commission was given a month to outline the details of an order to block Facebook’s transatlantic data flows, with the ban expected to come into effect in mid-May.
In 2020, Europe’s highest court ruled that the EU-US data transfer agreement was invalid, highlighting Washington’s insufficient data protection measures.
Facebook, which also owns WhatsApp and Instagram, has warned that suspending data transfers based on standard contractual clauses (SCCs) could have far-reaching implications for businesses relying on SCCs and for the availability of online services used by many individuals and businesses. Meta has reiterated that without SCCs or alternative means of data transfers, it would likely be unable to provide access to social media platforms like Facebook and Instagram throughout Europe.
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