Facebook Fined $122.5M For WhatsApp Takeover In Europe, Says Misinformation "Not Intentional"
Facebook has been facing a lot of flak in Europe lately. After recently being hauled up for violating data protection rules in France, the social networking company was recently fined 110 million Euros ($122.5 million) for misleading information in its filing for its acquisition of messaging app WhatsApp.
The European Commissioner, Margrethe Vestager, who regulates competition-related policies said in the press release issued Thursday: “Today's decision sends a clear signal to companies that they must comply with all aspects of EU merger rules, including the obligation to provide correct information. And it imposes a proportionate and deterrent fine on Facebook. The Commission must be able to take decisions about mergers' effects on competition in full knowledge of accurate facts."
Facebook bought WhatsApp in 2014 for $19 billion. The company was required file details about the merger with the European Commission about the merger under the European Merger Regulation. The company had promised the commission that it would not establish automated matching between Facebook users and WhatsApp user's accounts. But, going against Facebook’s own admission. WhatsApp announced its updates terms of service and privacy policy, which mentioned the possibility of linking WhatsApp accounts to Facebook accounts.
The commission even addressed a statement of objection to Facebook, detailing its concerns about the new policy in December 2016. An investigation was then held against Facebook, in which it was found that the company already knew that such a possibility existed at the time of filing its merger request. Because of the misinformation, the company has been fined one percent of its total value.
“The Commission considers that Facebook staff were aware of the user matching possibility and that Facebook was aware of the relevance of user matching for the Commission's assessment, and of its obligations under the Merger Regulation. Therefore, Facebook's breach of procedural obligations was at least negligent,” the Commission said.
Facebook, on its part, has denied that it intentionally misinformed the European Commission. The company said: “We’ve acted in good faith since our very first interactions with the Commission and we’ve sought to provide accurate information at every turn. The errors we made in our 2014 filings were not intentional and the commission has confirmed that they did not impact the outcome of the merger review. Today’s announcement brings the matter to a close.”
While the company has issued a plausible denial, it seems, the company had expected the Commission’s fine.
The connection between Facebook and WhatsApp or the misfiling is not the main issue, but rather it is the use of user’s data and their privacy. With the social network and the messaging app inter-connected, it provides Facebook with a lot of private user information, which is against Europe’s data protection laws.
Read: FCC And Broadband Privacy Rules: Senate Votes To Allow ISPs To Collect, Sell User Data
The situation bears a stark contrast to the U.S.’ handling of consumers’ data privacy with government agencies such as CIA and NSA snooping in on user’s data and the Federal Communications Commission recently allowing internet service providers to sell users’ data.
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