It actually looks like some sort of workaround scheme to their privacy policies in the EU. It seems to me that after transferring your information to PayPal Luxembourg, that they will sell your information to various third parties. I have also heard from some of my peers in the UK and EU, that they noticed that in the FAQ, they state that anyone who doesn't wish for this to happen - must close their PayPal account before the transfer takes place. Seems like a very tricky move on the part of PayPal, will better the economy of Luxembourg though. Money makes the world go round, eh