Russia Prohibits LinkedIn, Issues Warnings to Facebook and Twitter
In a move that could have far-reaching implications for international tech companies, Russia's data localization law has become more stringent, with stricter penalties for non-compliance. The law, which came into effect last year, aims to address state security issues and personal data leakage [1].
Under the new law, foreign tech companies must ensure that the personal data of Russian users is not initially collected or stored on foreign servers [1][5]. Companies that fail to comply with this requirement face fines of up to approximately €200,000 for repeated violations [2]. Russia’s regulatory system also mandates enhanced data retention and monitoring requirements via systems like SORM, allowing authorities extensive access to data stored domestically [3].
The "Landing Law" further requires foreign internet companies with more than 500,000 daily Russian users to establish a local legal presence, effectively enforcing further localization and regulatory control over their services [4]. This has led to some companies, like Telegram, reportedly seeking to register legally in Russia, while others, such as WhatsApp, face potential bans or restrictions [4].
From an international compliance perspective, these developments create complex challenges. International tech companies must localize storage and processing of Russian users’ personal data strictly within Russia for the initial collection phase [1][5]. They face a conflict between compliance with Russian localization laws and other jurisdictions’ data transfer laws that restrict data transfer to countries without adequate protection, which Russia does not meet in the eyes of the EU [5].
The future implications of these changes are significant. International tech firms will likely need to invest significantly in building or expanding local Russian data infrastructure or partnerships to maintain market access. Compliance complexity and costs will increase due to conflicting global data privacy regimes, requiring sophisticated legal, technical, and operational strategies [4]. Some companies may face bans or be forced to exit if unable or unwilling to comply with localization and registration laws [4].
Data localization reinforces Russia’s information sovereignty and state internet control goals, further limiting global tech interoperability with Russian operations and potentially fragmenting the global internet ecosystem [3][4].
The bill, which passed in the first of three readings in Russia’s lower house of parliament on Friday, also allows the government to designate media outlets, journalists, bloggers, and social media users as 'foreign agents' in Russia [6]. However, the bill does not censor the content of the designated 'foreign agents', and the impact on foreign journalists, bloggers, and social media users operating in Russia remains unclear [7].
It is also worth noting that the bill does not specify any penalties for non-compliance at this stage [8]. An investment adviser attempted to sell $500 billion of fake securities on social media sites, but details about the case are not provided [9].
The passage of this bill comes amidst growing concerns about freedom of the press in Russia [10]. The bill was passed one day before Russia’s annual Day of Journalists, raising questions about the government’s commitment to press freedom. The bill is expected to face further debate and potential amendments in the subsequent two readings [11].
The legal status of scraping, crawling, botting, and creating fake profiles remains unclear [12]. As the situation evolves, international tech companies will need to closely monitor developments and adapt their strategies to remain compliant with Russian laws while protecting the privacy and security of their users.
References:
[1] https://www.reuters.com/article/us-russia-internet-idUSKBN29O25E [2] https://www.rferl.org/a/russia-internet-bill-fines-foreign-companies-data-localization/30857855.html [3] https://www.theverge.com/2021/3/3/22307166/russia-internet-bill-data-localization-foreign-companies-tech-regulation [4] https://www.wired.com/story/russia-internet-bill-foreign-companies-data-localization/ [5] https://www.forbes.com/sites/forbestechcouncil/2021/02/01/russias-new-data-localization-law-what-international-companies-need-to-know/?sh=5d9c03133886 [6] https://www.reuters.com/world/europe/russia-passes-bill-designating-media-foreign-agents-2021-05-06/ [7] https://www.rferl.org/a/russia-foreign-media-agents-designation-bill/31045086.html [8] https://www.reuters.com/world/europe/russia-passes-bill-designating-media-foreign-agents-2021-05-06/ [9] https://www.wsj.com/articles/russian-investment-adviser-accused-of-selling-500-billion-in-fake-securities-on-social-media-11620249547 [10] https://www.rferl.org/a/russia-foreign-media-agents-designation-bill/31045086.html [11] https://www.reuters.com/world/europe/russia-passes-bill-designating-media-foreign-agents-2021-05-06/ [12] https://www.rferl.org/a/russia-foreign-media-agents-designation-bill/31045086.html
Technology companies face increasing challenges in navigating the complex intersection of politics and general news, as evidenced by Russia's data localization law. With stricter penalties for non-compliance, foreign tech firms must ensure that personal data of Russian users is not initially collected or stored on foreign servers, or risk fines of up to €200,000 for repeated violations. This policy, which reinforces Russia's information sovereignty and state internet control goals, could have far-reaching implications for global tech interoperability. Meanwhile, the Russian government is also considering designating certain media outlets, journalists, bloggers, and social media users as 'foreign agents,' potentially impacting the freedom of press in Russia.
