Facebook has found itself formally accused by the European Commission’s merger and anti-trust watchdog of misleading EU oversight regulators over its 2014 takeover of WhatsApp.
The European Commission says it was misled when Facebook said it was impossible to match users’ Facebook and WhatsApp accounts. In August, this year however, WhatsApp did exactly that, by linking users’ phone numbers with their Facebook identities.
While users can opt out of the linking of their Facebook account to their WhatsApp, the ability to do so is hidden away in their WhatsApp settings, and users only have one chance to agree or disagree to the linking.
In a statement released by the European Commission on the 20th December, the organisation said it had issued a statement of objections to Facebook over the way it had chosen to deal with the EC on the matter.
EU Competition Commissioner Margrethe Vestager said in a statement:
“The Commission’s preliminary view is that Facebook gave us incorrect or misleading information during the investigation into its acquisition of WhatsApp. Facebook now has the opportunity to respond… At this stage, 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.”
The EU’s merger and anti-trust watchdog is concerned that Facebook can match its users’ accounts with WhatsApp user accounts, despite giving assurances in 2014 that it wouldn’t. An update to Facebook and WhatsApp’s updated August terms of service and privacy update suggest that it can, and according to some commentators already has.
In the original 2014 review process, the EC watchdog discussed the possibility of Facebook matching its users’ accounts with WhatsApp users, Facebook’s response was that it “would be unable to establish reliable automated matching” between the two companies’ accounts.
Facebook has now been given an ultimatum of 31 January 2017 to respond to the accusation, but if the company is found to have breached the trust of the EC, it could be fined as much as 1pc of its annual turnover.
“Companies are obliged to give the Commission accurate information during merger investigations,” Vestager concluded. “They must take this obligation seriously. Our timely and effective review of mergers depends on the accuracy of the information provided by the companies involved.”
In a statement released the same day as the EC’s objections, Facebook said it had nothing to hide and had acted in good faith.