Facebook has been fined N28.75 billion ($70 million) for intentionally hoarding some information about its acquisition of Giphy, as UK’s Competition and Markets Authority (CMA) probes the deal struck in May 2020.
Zuckerberg had acquired the web-based animated gif search engine for $400 million, a deal that triggered a year anti-competition probe over fear of Facebook’s dominance in the digital advertising market.
Repeated efforts to obtain information about the Giphy deal had proved abortive despite an initial enforcement order (IEO) placed on Facebook by CMA, hence, the financial sanction on the social media platform.
The watchdog said Facebook is the first company to intentionally breach its IEO. It also fined Zuckerberg’s company £500,000 for not seeking approval before changing its Chief Compliance Officer twice.
In a statement addressing the conscious information omission by Facebook, CMA stated, “This is the first time a company has been found by the CMA to have breached an IEO by consciously refusing to report all the required information.”
It added that, “Given the multiple warnings it gave Facebook, the CMA considers that Facebook’s failure to comply was deliberate. As a result, the CMA has issued a fine of £50 million for this major breach, which fundamentally undermined its ability to prevent, monitor and put right any issues.”
CMA’s senior director of mergers, Joel Bamford, said the monetary sanction on Facebook is a warning to companies that believes they are above the law.
“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.” he said.
“This should serve as a warning to any company that thinks it is above the law,” Bamford said.
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