Russian professionals may soon find it a bit harder to link up.
Vladimir Putin’s government is threatening to shut down business networking site LinkedIn. The threat stems from a recent law in Russia that requires all companies doing business in the country to store their data locally, something that LinkedIn does not do.
The dispute appears to be the first major test of a law that was rushed through in the wake of large anti-government protests in 2012 after the controversial re-election of Putin as president. Although the law was criticized by some in the West as repressive at the time, it has been followed by similar legislation in some EU countries, driven by the same fears about data privacy in the wake of Edward Snowden’s revelations about NSA snooping.
Roskomnadzor, the Russian federal agency that regulates the telecom sector in that country, obtained an injunction against LinkedIn earlier this month from one of Russia’s lower courts. The company has an appeal set for Nov. 10 in Moscow.
The new law, referred to as the “On Personal Data” regulation, was passed in 2014. The law notionally forces companies to store the personal data of people within Russia, but the country has so far taken little or no action to enforce it against U.S.-based social media networks, none of which operate local data storage.
LinkedIn, with only 5 million users in Russia, is both an obvious but surprising target for Roskomnadzor. Obvious because, with a user base of only 5 million in Russia (many of whom are too busy to be on social media most of the time), it can be attacked without too much public uproar. But the crackdown is also surprising because LinkedIn’s new owner, Microsoft Corp. (MSFT), is one of the biggest and oldest American investors in Russia—well connected and respected in government circles. Microsoft hasn’t yet completed its planned $26 billion acquisition, however.
The Moscow Times, an English-language website, argues that LinkedIn is also an easier target because its record on data protection is indeed weak. In 2012 hackers stole the details of 6.4 million users. Ironically, a federal grand jury in California indicted a Russian, Yevgeny Nikulin, for that hack last week after he was arrested in the Czech Republic.
The article cited Roskomnadzor official Vadim Ampelonsky as saying that, whereas the agency meets at least twice a year with Facebook and Twitter to discuss their data protection measures, LinkedIn doesn’t have a representative in Moscow and hasn’t answered its questions.
Given the routinely selective application of the law in Russia, and the sharp recent deterioration in U.S.-Russian relations owing to various factors, Roskomnadzor’s move against LinkedIn could be construed as a warning shot to all U.S.-owned social media in Russia. While it would be a bolder step to ban Facebook (22 million users) or Twitter (8 million), it should be noted that neither is in the top two of locally-used social networks. While many Russians might complain, few would find themselves without alternatives.
LinkedIn declined to comment. Fortune understands that while LinkedIn has been in touch with Roskomnadzor about the data localization, the company hasn’t yet met with the agency to discuss their concerns.
