EU fines Facebook $122M for ‘misleading information’ in WhatsApp deal

Facebook headquarters

Facebook Inc. has been fighting a number of battles with regulators in the European Union over the last few years, including in countries like Germany and Belgium, but so far most of these conflicts have not resulted in any serious direct penalties on the social network. That changed today.

The European Commission has fined Facebook €110 million ($122 million USD) for “providing misleading information” during its $19 billion acquisition of WhatsApp in 2014.

The commission first filed its complaint against Facebook in December, when it accused the social network of misleading regulators about its ability to match WhatsApp user IDs with Facebook user IDs. According to the commission, Facebook claimed on more than one occasion that it did not possess the ability to match IDs in 2014 when it acquired WhatsApp, but the commission later found this claim to be false.

“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,” Commissioner Margrethe Vestager said in a statement. “And it imposes a proportionate and deterrent fine on Facebook. The Commission must be able to take decisions about mergers’ effects on competition in full knowledge of accurate facts.”

The commission said that its judgement does not affect the decision to allow the WhatsApp acquisition to take place ultimately, and it confirmed that it would have still cleared the acquisition even if it had known about the user matching at the time.

Facebook responded to the commission’s judgement with a brief statement of its own, saying, “We’ve acted in good faith since our very first interactions with the Commission and we’ve sought to provide accurate information at every turn. The errors we made in our 2014 filings were not intentional and the Commission has confirmed that they did not impact the outcome of the merger review. Today’s announcement brings this matter to a close.”

While Facebook’s fine is sizable, the sum is insignificant compared with the company’s total revenues, which reached more than $8 billion for the first quarter alone. Still, the fine shows that Facebook is not invulnerable to penalties in the EU, which could affect how the company chooses to do business in those countries.

Photo: Facebook