Facebook-parent Meta has said that its inability to transfer data “between and among countries and regions” in which it operates could affect its ability to provide services to its users and therefore impact its financial results. The company said this in its annual statement to the US Securities and Exchange Commission, the country’s financial authority. “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, which could adversely affect our financial results,” social media giant Meta said the statement.
The statement said that countries such as India are considering or have passed legislation implementing data protection requirements or requiring local storage and processing of data or similar requirements that could increase the cost and complexity of delivering our services. New legislation or regulatory decisions that restrict our ability to collect and use information about minors may also result in limitations on our advertising services or our ability to offer products and services to minors in certain jurisdictions.
These legal requirements “could increase the cost and complexity of delivering our services, cause us to cease the offering of our products and services in certain countries, or result in fines or other penalties,” the company said in Form 10-K.
Form 10-K offers a comprehensive overview of the company’s business and financial condition and includes audited financial statements.
Lawsuits over WhatsApp privacy policy
The company said that it had been facing investigations and lawsuits in Europe and India as well as other jurisdictions for the 2016 and 2021 update to WhatsApp’s terms of service and privacy policy. The 2021 privacy policy update by WhatsApp has been challenged through several lawsuits in India and some of these cases are pending hearing before the Supreme Court of India. “In addition, we have been managing investigations and lawsuits in Europe, India, and other jurisdictions regarding the August 2016 update to WhatsApp’s terms of service and privacy policy and its sharing of certain data with other Meta products and services, including a lawsuit currently pending before the Supreme Court of India, and also became subject to government inquiries and lawsuits regarding the 2021 update to WhatsApp’s terms of service and privacy policy. 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, which could adversely affect our financial results.”
The company also cautioned its shareholders that it could face new fines and orders on restriction, blocking of services, or other government-imposed remedies in certain geographies. “For example, legislation in Germany and India has resulted in the past, and may result in the future, in the imposition of fines or other penalties for failure to comply with certain content removal, law enforcement cooperation, and disclosure obligations. Numerous other countries in Europe, the Middle East, Asia-Pacific, and Latin America are considering or have implemented similar legislation imposing potentially significant penalties, including fines,” it said in the form.
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