The European Union (EU) on Thursday announced it will fine Facebook 110 million euros ($122 million) for providing incorrect or misleading information in connection with the 2014 purchase of mobile messaging service WhatsApp. The social network told the EC at the time of the proposed acquisition that it would be unable to establish reliable automated matching between user accounts of the two services, and reiterated this in response to a specific request for information from the Commission.
The fine is a sign European antitrust officials are increasing the level of scrutiny of Facebook and other leading tech firms in the market.
The decision taken by the EC sends a signal to other companies of the need to comply with all merger rules that the European Union has, including an obligation to provide information that is correct, said Margrethe Vestager the EC Competition Commissioner. "The Commission must be able to take decisions about mergers' effects on competition in full knowledge of accurate facts", she said.
The Commission has begun discussions since September with Facebook, which has temporarily halted in November the sharing of information with WhatsApp in Europe.
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However, last August, the accounts were indeed linked, and the EC found that Facebook employees were aware of that possibility three years ago during the acquisition. "Several cases that will start coming", Gry Hasselbalch, cofounder of Data Ethics, said.
"Normally, we don't know how our data is used".
Given the apparent inconsistency with the information provided, the Commission chose to investigate and concluded after a preliminary investigation that in fact the technical possibility of automatically matching Facebook and WhatsApp users had existed in 2014, and that Facebook staff were aware of such a possibility. "This decision shows it is actually a problem". An intentional or negligent failure to do so will lead to draconian fines-even where the provision of incorrect or misleading information does not have an impact on the ultimate outcome of the Commission's decision. Taking into account Facebook's cooperation with the Commission's investigation into the matter, by inter alia waiving its right to have an oral hearing, the Commission ultimately imposed a fine of Euro 110 million on Facebook.
Other actions similar to the French fine are in progress in a number of European states, but Facebook continues to insist that "putting people in control of their privacy is at the heart of everything we do", and says it has recently "simplified our policies further to help people understand how we use information to make Facebook better".