In a recent development, the Moscow District Court fined US-based Bitcoin and altcoin exchange Coinbase nearly $11,000 for failing to localize Russian users’ data within the country. The move is part of a broader crackdown on foreign services that don’t comply with Russia’s data localization laws. Here are the details…
Russia fined the Bitcoin exchange
According to reports in the Russian media, the court also fined the international association AIDA International in connection with the same issue. Thus, he underlined how seriously the Russian authorities approach data localization compliance. The court found both the Bitcoin exchange Coinbase and AIDA International guilty of administrative offenses under Article 13.11 of the Code of Administrative Offenses of Russia, in particular, for “the operator’s failure to fulfill the obligation to record, systematize, accumulate, store data of Russian citizens when collecting personal data.” found it. Fines of 1 million rubles each are the minimum stipulated in this article, with companies potentially facing fines of up to 6 million rubles.
This development follows fines imposed on several other leading international companies for similar non-compliance issues. Outside of the Bitcoin and altcoin space, many companies have been penalized. For example, in October, the Moscow Regional Court targeted the video communication service Zoom. The company has repeatedly refused to localize Russian user data within the country. Therefore, the court fined the company 15 million rubles. In August, the popular messaging application Telegram also came to the fore with a similar crime. For this he was fined 50,000 rubles.
Many giant companies were also penalized
There are some official institutions behind legal proceedings. Because this; It stems from a directive issued by Russia’s Federal Service for Communications, Information Technology and Mass Media Supervision (Roskomnadzor) at the end of May. The directive required all foreign services to localize databases of Russian users in Russia by July 1. According to information from the Russian news agency TASS, approximately 600 foreign companies have complied with this requirement. Thus, it ensured that personal data of Russian users were stored in Russia. In the list of penalized companies, there are many companies in addition to Bitcoin exchange Coinbase, Zoom and Telegram. In particular, industry giants such as Spotify, Apple, WhatsApp, Airbnb, Google, Twitch and Pinterest are also included.
The fines mark Russian authorities’ enforcement of data localization laws. It also reflects a concerted effort by Russian citizens to ensure that their personal information is stored within the country’s borders. As the July 1 deadline approaches, we will see the move of Bitcoin and altcoin exchanges. It is also curious how other international companies will respond to these strict data localization requirements. Apart from that, it remains to be seen whether other fines will be imposed by Russian authorities. This points to the data privacy regulations of global technology companies in different jurisdictions. It highlights the ongoing challenges companies face in navigating the complex landscape of regulations.
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