The UK’s Competition and Markets Authority (CMA) has fined Facebook £50.5 million ($70 million) after accusing the digital giant of deliberately breaking competition rules.
Facebook already owns its own service, including Facebook Messenger, as well as other influential brands like Instagram, WhatsApp, and Oculus VR.
According to a report in tech news site the Verve, the CMA has issued the fine in relation to Facebook’s acquisition of Giphy, the Gif-sharing service, in 2020.
Giphy is a well-known app that provides a vast library of short video animations. It’s hugely popular on the Facebook apps, but it can also be used by users on Facebook’s competitors, including TikTok, Twitter, and Snapchat.
In addition to this, there are some reports that Facebook could change the name of the app, which is another violation of the rules.
The CMA says Facebook has deliberately committed a “major breach” while ignoring numerous warnings and failing to provide information when asked to do so.
Facebook’s failure was “deliberate”
One of the key points raised by the CMA was that this breach was unique as it was a deliberate attempt to withhold and hide information. For that reason, the fine given to Facebook is more than 150 times higher than previous fines in similar cases.
In an official statement, the CMA said, “This is the first time a company has been found by the CMA to have breached a [order] by consciously refusing to report all the required information.”
The main concern surrounding Facebook owning Giphy is that it could breach competition laws. Many of the social media platform’s competitors use Gif images in apps and elsewhere.
After issuing an “initial enforcement order” to investigate the case and potentially limit companies that are merging, Facebook failed to provide any updates or information on how it plans to comply with the order.