14 DAY TRIAL // The European Commission is going after Facebook and has sent a Statement of Objections saying that the company “provided incorrect or misleading information” in 2014, during the acquisition of WhatsApp.
The alleged misleading information was given during merger investigations conducted by the EU. The EU wanted to know if Facebook could match user information with WhatsApp. Facebook stated multiple times that it was unable to establish automated matching between user accounts at the two companies.
The Commission took the information into account, but mentioned that it wasn’t the central point in clearing the transaction. Almost two years after the merger, WhatsApp changed its terms of service and privacy policy, for the first time in almost four years.
Following the decision made in August 2016, WhatsApp would link user phone numbers with Facebook accounts, for improving the service and offering better friend suggestions, as well as more relevant ads on Facebook for WhatsApp users.
Facebook could be fined with 1% of its turnover
The decision did raise some privacy concerns, with officials from several countries prompting Facebook to stop collecting data from WhatsApp users and the EU launching an investigation. It appears that Facebook might have had the technology to automatically link Facebook users IDs with WhatsApp accounts back in 2014.
“The Commission therefore has concerns that Facebook intentionally, or negligently, submitted incorrect or misleading information to the Commission, in breach of its obligations under the EU Merger Regulation,” reads today’s statement. The Commission added that Facebook has until January 31, 2017 to issue a response, and if the EU’s concerns are confirmed, the company could be fined up to 1% of its turnover. However, a confirmation won’t have an impact on the merger decision.
A Facebook spokeswoman said for Reuters that "We've consistently provided accurate information about our technical capabilities and plans, including in submissions about the WhatsApp acquisition and in voluntary briefings before WhatsApp's privacy policy update this year." She added that the company would cooperate with the Commission and that "a full review of the facts will confirm Facebook has acted in good faith."