FILE PHOTO: People are silhouetted as they pose with mobile devices in front of a screen projected with a Facebook logo, in this picture illustration taken in Zenica October 29, 2014.
CREDIT: REUTERS/DADO RUVIC
SAN FRANCISCO (Reuters) – If a new European law restricting what companies can do with people’s online data went into effect tomorrow (April 20) almost 1.9 billion Facebook Inc users around the world would be protected by it. The online social network is making changes that ensure the number will be much smaller.
Facebook members outside the United States and Canada, whether they know it or not, are currently governed by terms of service agreed with the company’s international headquarters in Ireland.
Next month, Facebook is planning to make that the case for only European users, meaning 1.5 billion members in Africa, Asia, Australia and Latin America will not fall under the European Union’s General Data Protection Regulation (GDPR), which takes effect on May 25.
The previously unreported move, which Facebook confirmed to Reuters on Tuesday, shows the world’s largest online social network is keen to reduce its exposure to GDPR, which allows European regulators to fine companies for collecting or using personal data without users’ consent.
That removes a huge potential liability for Facebook, as the new EU law allows for fines of up to 4 percent of global annual revenue for infractions, which in Facebook’s case could mean billions of dollars.
The change comes as Facebook is under scrutiny from regulators and lawmakers around the world since disclosing last month that the personal information of millions of users wrongly ended up in the hands of political consultancy Cambridge Analytica, setting off wider concerns about how it handles user data.
The change affects more than 70 percent of Facebook’s 2 billion-plus members. As of December, Facebook had 239 million users in the United States and Canada, 370 million in Europe and 1.52 billion users elsewhere.
Facebook, like many other U.S. technology companies, established an Irish subsidiary in 2008 and took advantage of the country’s low corporate tax rates, routing through it revenue from some advertisers outside North America. The unit is subject to regulations applied by the 28-nation European Union.
Facebook said the latest change does not have tax implications.
In a statement given to Reuters, Facebook played down the importance of the terms of service change, saying it plans to make the privacy controls and settings that Europe will get under GDPR available to the rest of the world.
“We apply the same privacy protections everywhere, regardless of whether your agreement is with Facebook Inc or Facebook Ireland,” the company said.
Earlier this month, Facebook Chief Executive Mark Zuckerberg told Reuters in an interview that his company would apply the EU law globally “in spirit,” but stopped short of committing to it as the standard for the social network across the world.
In practice, the change means the 1.5 billion affected users will not be able to file complaints with Ireland’s Data Protection Commissioner or in Irish courts. Instead they will be governed by more lenient U.S. privacy laws, said Michael Veale, a technology policy researcher at University College London.
Facebook will have more leeway in how it handles data about those users, Veale said. Certain types of data such as browsing history, for instance, are considered personal data under EU law but are not as protected in the United States, he said.
The company said its rationale for the change was related to the European Union’s mandated privacy notices, “because EU law requires specific language.” For example, the company said, the new EU law requires specific legal terminology about the legal basis for processing data which does not exist in U.S. law.
Ireland was unaware of the change. One Irish official, speaking on condition of anonymity, said he did not know of any plans by Facebook to transfer responsibilities wholesale to the United States or to decrease Facebook’s presence in Ireland, where the social network is seeking to recruit more than 100 new staff.
Facebook released a revised terms of service in draft form two weeks ago, and they are scheduled to take effect next month.
Other multinational companies are also planning changes. LinkedIn, a unit of Microsoft Corp, tells users in its existing terms of service that if they are outside the United States, they have a contract with LinkedIn Ireland. New terms that take effect May 8 move non-Europeans to contracts with U.S.-based LinkedIn Corp.
LinkedIn said in a statement on Wednesday that all users are entitled to the same privacy protections. “We’ve simply streamlined the contract location to ensure all members understand the LinkedIn entity responsible for their personal data,” the company said.
Reporting by David Ingram in San Francisco; Additional reporting by Joseph Menn in San Francisco, Padraic Halpin and Conor Humphries in Dublin and Douglas Busvine in Frankfurt; Editing by Greg Mitchell and Bill Rigby
Facebook is sued after stock plunge ‘shocked’ market
FILE PHOTO: Facebook CEO Mark Zuckerberg is seen on stage during a town hall at Facebook’s headquarters in Menlo Park, California September 27, 2015. REUTERS/Stephen Lam
NEW YORK (Reuters) – Facebook Inc (FB.O) and its chief executive Mark Zuckerberg were sued on Friday in what could be the first of many lawsuits over a disappointing earnings announcement by the social media company that wiped out about $120 billion of shareholder wealth.
The complaint filed by shareholder James Kacouris in Manhattan federal court accused Facebook, Zuckerberg and Chief Financial Officer David Wehner of making misleading statements about or failing to disclose slowing revenue growth, falling operating margins, and declines in active users.
Kacouris said the marketplace was “shocked” when “the truth” began to emerge on Wednesday from the Menlo Park, California-based company. He said the 19 percent plunge in Facebook shares the next day stemmed from federal securities law violations by the defendants.
The lawsuit seeks class-action status and unspecified damages. A Facebook spokeswoman declined to comment.
Shareholders often sue companies in the United States after unexpected stock price declines, especially if the loss of wealth is large.
Facebook has faced dozens of lawsuits over its handling of user data in a scandal also concerning the U.K. firm Cambridge Analytica. Many have been consolidated in the federal court in San Francisco.
Thursday’s plunge also hit Zuckerberg’s bottom line.
Zuckerberg had been tied with Warren Buffett as the world’s fourth-richest person, but the Berkshire Hathaway Inc (BRKa.N) chairman’s current $83 billion fortune tops Zuckerberg’s $66 billion, Forbes magazine said.
Buffett now ranks third among the world’s billionaires, while Zuckerberg is sixth.
Facebook shares fell another 0.8 percent on Friday, closing at $174.89 on the Nasdaq.
The case is Kacouris v Facebook Inc et al, U.S. District Court, Southern District of New York, No. 18-06765.
Reporting by Jonathan Stempel in New York; Editing by Susan Thomas
Malacañang opposes FB’s choice of fact checkers
Presidential Spokesperson Harry Roque said in a statement that it will become a problem because what he calls as Facebook’s “police of the truth” are “sometimes partisan.”
MANILA, Philippines — Malacañang wants to meet with Facebook over its choice of fact checkers specifically for Filipino accounts on the social media platform.
Facebook has named controversial social news network, Rappler and another news outlet, Vera Files, as third-party fact-checkers in a campaign to curb the proliferation of fake news on Facebook accounts of Filipino users.
In a statement posted on the website of the Presidential Communications Operations Office (PCOO) Undersecretary Lorraine Badoy said, “efforts are underway for both the PCOO and Facebook to sit across the table and discuss and hopefully, reach agreements” to get a “shared goal of responsible and intelligent use of social media.”
Last week, a number of Duterte supporters complained after Facebook blocked their accounts.
Meanwhile, Presidential Spokesperson Harry Roque said it will become a problem because what he calls as Facebook’s “police of the truth” are “sometimes partisan.”
“I commiserate with those who object with the selection of Rappler and Vera files because we know where they stand in the political spectrum,” he said.
Roque is encouraging all supporters of the administration to use the platform itself to actively voice out their protests against Facebook’s choice of fact checkers.
“The users of Facebook should make known their wishes to Facebook itself that there should be a more partial arbiter of the truth,” Roque concluded. — Marje Navarro –Pelayo | UNTV News & Rescue
NPC investigates Facebook data breach
Facebook, a social media giant faces data breach scandal.
MANILA, Philippines — The National Privacy Commission (NPC) has begun investigation on Facebook ‘s data breach.
It can be recalled that the social media giant confirmed that Cambridge Analytica, a political data firm, harvested personal information from over one million Filipino Facebook users.
According to NPC commissioner Raymund Liboro, they have sent a letter to Facebook founder Mark Zuckerberg, requiring the social media giant to submit documents to the committee that will help establish the scope of the breach and its impact on Filipinos.
The investigation centers on how Facebook shared the Filipino users’ personal data with the third party. — UNTV News & Rescue