It's crazy that they haven't added this already. Facebook needs to get my permission to find out where I am, but not to scrape a hundred names, phone numbers, and addresses out of my phone? Bizarre.
Here's the explanation:
"If you enable this feature, all contacts from your device (name, email address, phone number) will be sent to Facebook and be subject to Facebook's Privacy Policy, and your friends' profile photos and other info from Facebook will be added to your iPhone address book. Please make sure your friends are comfortable with any use you make of their information."
See: http://en.wikipedia.org/wiki/Data_Protection_Directive
This is one of the few areas where the EU is (still...) ahead of the rest of the world. Facebook should not be able to collect data on your friends even at your request unless your friends explicitly consent to this.
Clearly your friends have no business passing on your data and Facebook has no business collecting it. "Make sure your friends are comfortable" is no excuse for facebook to go ahead and break the law.
> Your neighbours to the north