Facebook fined $70 million for ‘deliberate’ failure to comply with UK regulator
CNN
Walé Azeez, CNN Business
The UK competition regulator has slapped Facebook with a $70 million fine for repeatedly ignoring warnings and deliberately breaking its rules.
The Competition and Markets Authority (CMA) said in a statement Wednesday that Facebook had “consciously” refused to report all the required information during an investigation of the tech giant’s acquisition of online database Giphy.
The regulator issued an “initial enforcement order” related to the takeover in June 2020, requiring the companies to compete against each other as usual and halt any integration efforts during the investigation.
Facebook was required to provide the regulator with regular updates about its compliance. The tech giant “significantly limited the scope of those updates,” the CMA said Wednesday, “despite repeated warnings.” The regulator said it had concluded that Facebook’s “failure to comply was deliberate.”
The CMA said this is the first time a company has breached an initial enforcement order by “consciously refusing to report all the required information.” The £50.5 million ($70 million) fine is 155 times greater than the previous record for this type of breach.
“We warned Facebook that its refusal to provide us with important information was a breach of the order but, even after losing its appeal in two separate courts, Facebook continued to disregard its legal obligations,” CMA senior director of mergers Joel Bamford said in a statement.
“This should serve as a warning to any company that thinks it is above the law,” added Bamford.
Facebook said in a statement that it “strongly” disagrees with the regulator’s “unfair decision to punish Facebook for a best effort compliance approach.”
“We will review the CMA’s decision and consider our options,” the company added.
The CMA also fined Facebook £500,000 ($690,000) for changing its chief compliance officer on two separate occasions without first seeking its consent. The regulator’s investigation into Facebook’s acquisition of Giphy is ongoing, with no decision reached to date.
UK and EU regulators separately announced in June that they were investigating Facebook’s use of data on antitrust grounds.
Pressure on the company is also coming from US lawmakers after a whistleblower went public with allegations that Facebook has repeatedly prioritized profits over public good.
Appearing before US lawmakers earlier this month, former Facebook product manager Frances Haugen detailed a range of concerns including that the company knew it was serving harmful, eating disorder-related content to young users and that the use of Facebook by authoritarian leaders could present national security concerns.
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