EU Fines Facebook $122 Million Over WhatsApp Merger

(CN) – The European Commission on Thursday fined Facebook over $122 million for providing misleading information to regulators regarding its 2014 takeover of the social-media platform WhatsApp.

The commission’s decision comes at the end of an investigation opened in late 2016, at which time the regulatory body said it suspected Facebook gave “incorrect or misleading” information about its technological capabilities to match its users’ accounts with WhatsApp user accounts.

At the time, the commission said it was tipped to the truth by an update to WhatsApp’s terms of service in early 2016 notifying users of the possibility of linking their phone numbers with their Facebook identities.

On Thursday, the commission confirmed its suspicions – that Facebook staff knew they had the capability to automatically match Facebook and WhatsApp users’ identities, but told merger assessors otherwise.

“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,” competition commissioner Margrethe Vestager said in a statement. “The commission must be able to take decisions about mergers’ effects on competition in full knowledge of accurate facts.”

The commission said Thursday’s decision has no impact on its approval of the takeover, which was based on a number of other factors.

EU merger laws allow the commission to fine violators up to 1 percent of a company’s aggregated turnover. However, the commission noted Facebook acknowledged its errors when the investigation was opened and waived its right to a hearing – making the investigation more expedient – and adjusted the fine accordingly.

The commission said this is the first time a company has been fined for providing incorrect or misleading information since the merger law took effect in 2004.

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