EU Fined Facebook $122 Million For Providing Misleading Information During WhatsApp Acquisition

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May 18
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The European Commission has fined Facebook $122 million for misleading the EU regulators with incorrect information when the company acquired WhatsApp. At that time, the social network giant stated that it would not be able to link user profiles on WhatsApp and Facebook. However, the company announced last year that it would be sharing WhatsApp data with Facebook. So let’s dive in to see some more details on the subject.

Facebook Fined $122 Million For Providing Inaccurate Information To The European Commission

Facebook’s statement goes against the claims that it made back in 2014 – the period when the company took off to acquire the immensely popular internet messaging app, WhatsApp. Reuters report that interconnecting Facebook and WhatsApp users’ identities was possible way back in 2014 and the Facebook staff was aware of it.

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The Commission has found that, contrary to Facebook’s statements in the 2014 merger review process, the technical possibility of automatically matching Facebook and WhatsApp users’ identities already existed in 2014, and that Facebook staff were aware of such a possibility.

On the other hand, the EU Merger Regulation requires companies to provide correct and true information during takeovers and mergers. Moreover, the provision of correct information during acquisitions is irrespective of what the final result will be.

Today’s decision has no impact on the Commission’s October 2014 decision to authorise the transaction under the EU Merger Regulation. Indeed, the clearance decision was based on a number of elements going beyond automated user matching. The Commission at the time also carried out an ‘even if’ assessment that assumed user matching as a possibility. The Commission therefore considers that, albeit relevant, the incorrect or misleading information provided by Facebook did not have an impact on the outcome of the clearance decision.

The social network giant said that the previous statement it made was a mistake, instead of deliberately deceiving the EC. Moreover, the company also said that the EC would have went ahead and allowed the merger with or without the information. Furthermore, the company also said that it acted in “good faith” since it was its “first interaction with the commission” and have provided it with the correct information at all times. However, the EU states that the company has committed two separate infringements when it provided incorrect and misleading information. Moreover, the EU says that it considers the act serious.

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This is it for now, folks. What are your thoughts on the whole scenario? What do you think will be the potential outcome of the case? Share your thoughts with us in the comments.

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