UK Regulator Fines Facebook For $70 Million Over Encroachment Order Breach

The regulator also noted that Facebook didn’t share full updates about its compliance with requirements to compete with Giphy and not integrate its operations with Giphy amid the ongoing investigation

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New Delhi: In a latest action against the social media giant Facebook, the United Kingdom has slapped the company with over £50 million (roughly Rs 520 crore) fine for information breach, according to Reuters.

Britain’s competition regulator charged the popular social networking company for breaching an order imposed during its investigation into its purchase of GIF platform Giphy, the agency said. However, the company has strongly disagreed with the CMA.

The Competition and Markets Authority (CMA) pointed out that the company deliberately failed to comply with its order, and the penalty served as a warning that no company was above the law. Facebook has come under scrutiny in the past from regulators and lawmakers about its business practices.

The regulator also noted that Facebook didn’t share full updates about its compliance with requirements to continue to compete with Giphy and not integrate its operations with Giphy's amid the ongoing investigation.

In its order, the regulator noted that the company failed to provide the required information, despite multiple warnings, therefore considering it a deliberate attempt.

"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," said Joel Bamford, senior director of mergers at the CMA.

Bamford's sentiments are similar to those of US Solicitor of Labor Seema Nanda in which the Justice Department stated that Facebook used recruitment practices designed to deter US workers through conditions such as requiring applications to be submitted only by mail, refusing to consider American workers who applied for positions and hiring only temporary visa holders.

In that case, Facebook agreed to pay up to $14.25 million (roughly Rs. 105 crores) to settle civil claims over its adherence to recruitment rules.

"This should serve as a warning to any company that thinks it is above the law."

Facebook's Response

Responding to the charges, Facebook said: "We strongly disagree with the CMA's unfair decision to punish Facebook for a best-effort compliance approach, which the CMA itself ultimately approved.

"We will review the CMA's decision and consider our options." Meanwhile, the social media giant is planning to rebrand, a change that would likely see a parent company overseeing its brands.