Monday, 29 May 2017

EC fines Facebook €110m over 'misleading' WhatsApp deal

By Nick Wood, Total Telecom
Thursday 18 May 17

Social network claimed it would be unable to automatically link Facebook accounts to WhatsApp users, then did it anyway.

The European Commission on Thursday fined Facebook €110 million for providing misleading information pertaining to its $19 billion (17.08 billion) acquisition of WhatsApp in 2014.   "Today's decision sends a clear signal to companies that they must comply with all aspects of EU merger rules…

The European Commission on Thursday fined Facebook €110 million for providing misleading information pertaining to its $19 billion (17.08 billion) acquisition of WhatsApp in 2014.

 

"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," said EU competition commissioner Margrethe Vestager, in a statement. "And it imposes a proportionate and deterrent fine on Facebook."

When Facebook notified the Commission of the WhatsApp deal, it said it would be unable to automatically link someone's Facebook profile to their WhatsApp account with any degree of reliability. However, WhatsApp updated its terms of service and privacy policy in August 2016 to include the possibility of doing just that.

A subsequent investigation by the Commission found that not only was such a feat technically possible back in 2014, but Facebook staff knew that it was at the time.

"The Commission must be able to take decisions about mergers' effects on competition in full knowledge of accurate facts," Vestager said.

Given that it takes Facebook less than four days to generate more than €110 million in free cash flow, Thursday's fine might appear a little lenient.

According to the Commission, Facebook admitted the infringement and waived its procedural right to have access to the Commission's file and to an oral hearing, allowing the Commission to conduct the investigation more efficiently.

"The Commission has taken Facebook's cooperation into account in setting the level of the fine," the EC said.

Please enable JavaScript to view the comments powered by Disqus.

Newsletter signup

Quickly get on board and up to date with the telecoms industry