The billionaire fine to Facebook for carelessness with user data

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At the heart of this decision is the use of standard contractual clauses to move data from the European Union to the US. Facebook announces Meta, the new name of its parent company Europe and the United States. Issued by Ireland’s Data Protection Commission (DPC), this is the largest fine ever imposed under the European Union’s General Data Protection Regulation (GDPR) privacy law. The GDPR sets out rules that companies must follow to transfer user data outside the European bloc. Meta said it will file an appeal against the “unjustified and unnecessary” decision. At the heart of this decision is the use of standard contractual clauses (SCCs) to move data from the European Union to the US. These legal contracts, drawn up by the European Commission, contain safeguards to ensure that personal data remains protected when transferred outside Europe. But there are concerns that these data streams will still expose Europeans to weaker US privacy laws — and US intelligence could access the data. This decision does not affect Facebook in the UK. ‘Dangerous precedent’ Most large companies have complex networks for transferring data — which can include email addresses, phone numbers and financial information — to overseas recipients, much of which relies on SCCs. And Meta says its widespread use makes the fine unfair. “We are therefore disappointed to have been singled out using the same legal mechanism as thousands of other companies looking to provide services in Europe,” said Facebook President Nick Clegg. “This decision is flawed, unwarranted and sets a dangerous precedent for countless other companies transferring data between the EU and the US.” Decade-long battle In 2013, former US National Security Agency contractor Edward Snowden disclosed that US authorities had repeatedly accessed people’s data through technology companies like Facebook and Google. And Austrian privacy activist Max Schrems has taken legal action against Facebook for failing to protect his privacy rights, starting a decade-long battle over the legality of transferring data from the European Union to the US. Europe’s highest court, the European Court of Justice (ECJ), has repeatedly said that Washington does not have sufficient controls in place to protect Europeans’ information. And in 2020, the ECJ declared a data transfer agreement from the European Union to the US invalid. But the court left the door open for companies to use SCCs, saying that transferring data to any other country outside the bloc was valid as long as it guaranteed an “adequate level of data protection”. It was this test that Meta failed to pass. ‘Fundamentally restructure’ Asked about the €1.2 billion fine, Schrems said he was “happy to see this decision after 10 years of litigation”, but it could have been much higher. “Unless US surveillance laws are corrected, Meta will have to fundamentally restructure its systems,” he added. Despite the record amount of the fine, experts say they believe Meta’s privacy practices will not change. “A billion euro traffic fine for illegal parking is meaningless to a company that makes many billions more from illegal parking,” says Johnny Ryan, member of the Irish Council for Civil Liberties. The US recently updated its internal legal protections to offer the European Union greater assurances that US intelligence agencies would follow the new rules governing such access to data. In 2021, Amazon was fined for similarly flouting the European Union’s privacy standard. Ireland’s Data Protection Commission has also fined WhatsApp, another company owned by Meta, for violating strict regulations regarding the transparency of data shared with its other subsidiaries.

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