Facebook may have provided inaccurate or misleading information to the European Commission when the Commission was investigating its WhatsApp acquisition in 2014. The EC said Facebook had the ability to link its own user accounts with WhatsApp accounts since 2014, but it didn’t tell the Commission about it. The accusation comes shortly after the Commission decided to look into WhatsApp’s new data-sharing policy with Facebook.
WhatsApp’s Data-Sharing With Facebook
This summer, WhatsApp announced that it would start sharing its user information with Facebook, despite previously promising it would never share data with other parties. The company allowed users to opt-out from this new policy only for the first 30 days. The opt-out wasn’t complete, either, as some “basic information” would still be shared with Facebook. Future users of WhatsApp may not even get the option to abstain from this data sharing.
The Hamburg Commissioner for Data Protection and Freedom of Information has already issued an order for Facebook to stop collecting WhatsApp data in Germany until things are clarified. A little later, the Article 29 Working Party formed of all the privacy chiefs in the European Union also urged Facebook to stop its WhatsApp data collection.
Facebook has agreed to stop the collection for now, but it’s not clear if any of the previously collected data will be deleted, and the company might already have gotten WhatsApp user data because the opt-out deadline had passed before the order to stop collecting user information was received. Facebook may not be able to collect data about new friend additions on WhatsApp, but if it collected existing contact lists, it should already have a good idea of who everyone’s friends are on both services.
Facebook May Have Lied About Auto-Matching Capability
While investigating WhatsApp’s recently announced data-sharing with Facebook, the Commission learned that Facebook had the capability to match WhatsApp and Facebook user IDs since 2014. At the time, Facebook told the Commission that it did not have this capability. Providing inaccurate or misleading information to the European Commission violates the EU Merger Regulation.
This wouldn’t be the first time Facebook has misled the public about its tracking capabilities. Previous reports show that Facebook has been enabling new user-tracking technologies years before making them public.
Commissioner Margrethe Vestager, in charge of competition policy, said: "Companies are obliged to give the Commission accurate information during merger investigations. 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 this specific case, 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."
The European Commission gave Facebook until January 31 to respond to this accusation. If the accusation proves true, and if Facebook did indeed lie to the Commission about having the ability to automatically match WhatsApp and Facebook IDs since 2014, then the company could be fined 1% of its total annual revenue (about $180 million).
The Commission said this will not impact the merger of the two companies because it also considered other factors before approving the merger. Even if the merger stands, it remains to be seen what the investigation will ultimately mean for WhatsApp-Facebook data-sharing in the European Union.