The regulator issued a “Preliminary Enforcement Order” related to the acquisition in June 2020, requiring the companies to compete against each other as usual and to prevent any attempts at amalgamation during the investigation.
Facebook was required to provide regulators with regular updates about its compliance. Despite repeated warnings, the tech giant “significantly limited the scope of those updates,” the CMA said on Wednesday. The regulator said it has concluded that Facebook’s “failure to comply was intentional.”
The CMA said this is the first time a company has violated a preliminary enforcement order “by deliberately refusing to report all required information.” The £50.5 million ($70 million) fine is 155 times the previous record for this type of violation.
Joel Bamford, CMA’s senior director of mergers, said in a statement, “We warned Facebook that refusing to provide us with critical information was a violation of the order, but even after losing appeals in two separate courts, Facebook has kept its continued to disregard legal obligations.” Statement.
“This should serve as a warning to any company that thinks it is above the law,” Bamford said.
Facebook said in a statement that it “strongly” disagrees with “the regulator’s unfair decision to penalize Facebook for its best-effort compliance approach.”
“We will review the CMA’s decision and consider our options,” the company said.
The CMA also fined Facebook £500,000 ($690,000), which previously replaced its chief compliance officer without his consent on two separate occasions. The regulatory investigation into Facebook’s acquisition of Giphy continues, with no decision to date.
The company is also coming under pressure from US lawmakers as Facebook has repeatedly prioritized profits over the public good after a whistleblower alleged that it went public.
Credit : www.cnn.com