Meta warns it could pull Instagram and Facebook in Europe if it loses a data-sharing ruling

• Ireland's data watchdog warned in 2020 that Meta's data-sharing practices may be illegal.
• Meta warned Thursday it could pull Instagram and Facebook in Europe if it loses a ruling on the matter.

Meta appears to be heading for another stand-off with the European Union.

The tech giant said in its annual report Thursday that it may choose to pull some of its products in Europe if EU rules are enacted to stop it sending data back to the US.

Ireland's data protection watchdog warned Meta in September 2020 that the legal mechanism it uses to share EU user data with its US servers, called Standard Contractual Clauses (SCCs), may not be legal.

Meta said in its annual report that it's expecting a final ruling in the first half of 2022 on whether it can continue to use SCCs.

"If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on SCCs or rely upon other alternative means of data transfers from Europe to the United States, we will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe," Meta wrote in its annual report.

The Irish watchdog's warning came after the European Court of Justice invalidated Privacy Shield, a data-sharing arrangement between the EU and the US. Privacy Shield was struck down on the basis that US data surveillance did not comply with EU data protection standards.

The ruling on Privacy Shield upheld SCCs as a potential transfer mechanism with other countries, but said that those countries' data protection laws must be in line with EU regulations. The watchdog's concern was that US data surveillance may be too intrusive to qualify, The Wall Street Journal reported in September 2020.

Axel Voss, a member of the European Parliament, on Tuesday accused Meta of trying to strong arm Europe into weakening its data protection laws. "Meta cannot just blackmail the EU into giving up its data protection standards, leaving the EU would be their loss," Voss tweeted.

Roughly 24% of Meta's 2021 revenue came from Europe, according to its annual report.

A Meta spokesperson told Insider: "We have absolutely no desire and no plans to withdraw from Europe, but the simple reality is that Meta, and many other businesses, organisations and services, rely on data transfers between the EU and the US in order to operate global services."

The spokesperson added: "Like other companies, we have followed European rules and rely on Standard Contractual Clauses, and appropriate data safeguards, to operate a global service. Fundamentally, businesses need clear, global rules to protect transatlantic data flows over the long term, and like more than 70 other companies across a wide range of industries, we are closely monitoring the potential impact on our European operations as these developments progress."