EU privacy regulator restricts Facebook and Instagram ad business

Meta, the parent company of Facebook, Instagram and WhatsApp, is close to receiving another direct hit against its advertising business in the EU. The European Data Protection Supervisor, which coordinates the action of national authorities, has ruled that the corporation cannot require users to agree to receive personalized ads based on their online activity just for using its services, as revealed by the Wall Street Journal.

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The decision could severely limit the data Meta can access to personalize and sell such ads. The multinational has been allowing users to opt out of receiving personalized ads based on data from other websites and apps for years, but has not given that option for ads based on data about user activity on its own platforms, such as videos. that Instagram users see.

The European Supervisor has made this decision after several national authorities disagreed with the Irish data protection agency about whether the use of a digital service is an adequate legal basis to force the user to see advertisements based on their navigation.

Ireland is in charge of leading this type of privacy resolutions because the European headquarters of the majority of American technological multinationals, such as Meta, are located in its territory, thanks to a very beneficial tax policy. However, the Irish authority must come to an agreement with those of the rest of the countries in cases that affect the common Europeans. If they cannot reach an agreement, the European Supervisor intervenes.

Now Ireland must finish off the process and issue the resolution, which can be appealed by Meta in court. “This is not the final decision and it is too early to speculate,” Meta said in a statement after being contacted by

“The European General Data Protection Regulation allows a series of legal bases by virtue of which data can be processed, beyond consent or the execution of a contract. In the Regulation there is no hierarchy between these legal bases, and none should be considered better than another. We have fully collaborated with the Irish authority in their investigations and we will continue to collaborate with them while they finalize their decision”, details the multinational.

These types of restrictions on its advertising business have been one of the main reasons why investors have withdrawn their support for Meta in the last year, a period in which it has lost 65% of its value on the stock market. Its founder, Mark Zuckerberg, has acknowledged that privacy resolutions and manufacturers’ decisions to limit the extraction of personal data from their devices caused him to stop earning $10 billion in 2021. His forecast is that the number of 2022 is even bigger.

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