Norway to fine Meta $98,500 a day over user privacy breach from 14 August
theguardian.com
theguardian.com
[1] https://www.theatlantic.com/business/archive/2015/03/finland...
[2] https://www.theguardian.com/world/2017/nov/17/norwegian-heir...
It hasn’t even started accumulating. How are you declaring it won’t work?
Then you weren’t in a budgeting role. Multiple heads in Facebook’s Norwegian office will be on the line if they lose a double-digit fraction of profits. If you want headlines, go big and risk losing in court. If you want results, be smarter.
The way Oslo is playing it, this looks smart. They’re keeping it local to avoid jurisdictional challenges. And instead of a Vestager-Khan populist swing for the fences that entrenches both sides in litigation for years, it gives Meta a reasonable opening to actually change its behaviour in the short run.
Nobody ever gets fired for adverse policy environment, that’s bad fanfic.
Unless you throw an executive to prison like Brazil or force temporary shutdown like India or leverage three digit million fines like the EU … it’s all pocket money.
Also, if Facebook volunteers to pay a 100%+ effective tax rate in Norway…that seems fine for Norway?
> Finally, we note that Twitter assured the court that it would comply with the warrant by 5:00 p.m. on February 7, and never raised the possibility that it would defy the order for a month and end up owing the court “the entire world’s gross domestic product.”
But to a company like Meta, this is probably pocket change.
We read about privacy related fines here and there, but none really seem to take into account the global revenue
I am aware that EU is a PR stunt, probably will make some regulation here and there, but nothing exceptional, it's still a neoliberal/corporativist sewer at the end of the day
But yeah it's not up to me, but history is history
https://www.bbc.com/news/technology-64075067 or https://pubmed.ncbi.nlm.nih.gov/32018149/
I'm not in the mood of self-inflicting pain to go back to each scandal related to meta, but I guess these are quite heavy examples of the contribution of this company to society(ies?)
I am italian no? we have some high tax evasion, people say that in order to compete they can't pay all the taxes, but no one says that they MUST be in business, by staying in business, they hold a spot, and the rest of companies in order to compete have to evade taxes too, we can't settle on companies that are bad for the society, because they hold back companies that can add value and offering the same stuff with better ethics
What I'm responding to is this:
> Meta is useless for society
Which I think I have falsified. You've now changed your position to "Meta is better than a company I can imagine, but Meta doesn't allow to exist", which I think is more accurate.
So yeah let's say judges are not day drinkers and they are continuously fining meta for reasons, is it being once per month fined? Is it consistently unethical?
So it keeps a power spot, it retains users thanks to dark patterns, and unethical algorithms, it holds a dominant position, what I think is that a better company CAN or CANNOT exist, but if Meta is allowed to keep being unethical and holding a dominant position then we would never know
What I say is that we should not annihilate companies who make mistakes.
We should annihilate companies that are consistently unethical (Or day drinking judges, I guess at this point)
And without any cult of holding morality, I don't hold it, I don't want , I don't want to be a dictator, but there are laws, and according to courts Meta is breaking those laws over and over, I am not a messiah, but at a certain point we have to trust the entities whose jobs is to know the law when they say Meta is doing unethical stuff and so are fining it
> That doesn't mean it should always be applied. We shouldn't be attempting to annihilate companies. Just make sure the fine outweighs the benefit of doing something - just as we would with most fines.
You seem to be agreeing, but given the length of your prose it's hard to tell. Do you disagree?
The goal here is compliance. So the regulators will first try guidance, then a formal warning, then daily fines, then increasing the fine, fine (local) directors personally, and finally dissolvent of Metas local company.
Metas local company is named "Facebook Norway AS" and in 2022 did have a revenue of about 6.6 million USD, with a profit of 3.6 million USD according to https://www.proff.no/selskap/facebook-norway-as/oslo/reklame... . They have 27 employees. The revenue from Norway are however much bigger and was speculated to be 233 million USD in 2021: https://e24.no/naeringsliv/i/A3r1Mz/facebook-bokfoerte-bare-...
There was talk California should've used it on Uber for Greyball.
“Corporate nuke” is a corporate lobbyist’s term for distracting from massive fines. Barring expropriation, once you ask what happens to the nuked assets, corporate death penalties all come down to massive fines with extra steps. If you want to “nuke” a corporation, revoke its licenses (not applicable here) or levy a massive fine.
I've said it before and I'll say it again: the only way to make fines have any teeth for companies like this is for states to fine companies in equity, not cash. Shareholders will force change if the state might realistically become the majority shareholder and in doing so dilute everyone else's holding.
1% a week per breach ought to do it.
And well, we're living through a period where we're rapidly accruing evidence every day of how bad the alternative is.
For what it is worth, I'd like to see companies like Meta, Alphabet, and Amazon turned into global cooperatives governed by their employees and users. These would be the largest democracies the world has ever seen and would almost certainly be governed more sensibly than they are today.
Just levy a fine. From the corporate death penalty to this stuff, it’s all just fines with financial engineering. Cut out the bankers and lawyers and just levy a bloody fine.
Every problem you think you’re solving by adding extra steps simply compounds the complexity of levying massive fines while distracting from them.
Of course there is: who would buy shares that can be stolen by the state?
This is why moralisers shouldn't design systems: they miss even the most glaringly obvious consequences of their OTT punishments.
The idea of property is a legal one. It has no other basis in the world - if a democracy decides that property is forfeit if the law is broken, that is perfectly fine. See also, wealth taxes.
People already buy shares in these companies because they are profitable, and likely to remain so in the future. The problem is passive investment (which is forced on most people as pension funds don't "pass through" the right to vote) means people don't have to govern these organisations to protect the value of their investments. Fines are the cost of doing business.
If the stakes were "use it lawfully or lose it" the shareholders might realistically become more inclined to take action against boards who allow mismanagement. That's what this is, by the way: mismanagement with global consequences.
Investment won't go anywhere because people will always seek a return on their capital. The idea that they would rather see that capital inactive and atrophying over time rather than complying with simple and clear rules around corporate conduct is absurd.
I mean, it doesn't matter. The people with the jails are the people who write the rules that say how much of my effort I keep.
The difference is: we have a well-defined separation between money (a tool to communicate relative value) and ownership. Moving the government into the taking things you own business is a bad idea.
They aren't talking about anything like this. The companies can avoid turning over equity by not getting fined. I don't think this is quite the right approach, but I do think we should consider other options. For example, getting fined means that stockholders can't get payouts and execs couldn't get bonuses or anything outside of their base monetary salary. These sorts of things make it harder to just write off a fine as "cost of business" even if the fine itself is low.
Norway can do this to the Norwegian entity. It has no jurisdiction over the global company.
It is worth remembering that there's no such thing as a "global" company, by the way. These are largely American companies. They are structured to be unaccountable to other countries, and this is one of the ways in which american imperialism works.
Not how sovereignty works. Oslo’s extraterritorial enforcement is bound by treaties that set limits on what it can do. It ultimately requires others’ coöperation.
In practice, we delegate this to courts. The EU’s track record there is put to shame only by the FTC. Oslo, uniquely, seems to be ignoring the siren calls of fist pounding to populists in favour of prodding Facebook to change.
Do you disagree with corporations being held accountable, or do you have an alternative proposal that doesn't let them get away with murder, so to speak?
I genuinely don't understand how you read it this way. We already have mechanisms in place to punish companies, and send their directors to jail. Stealing them from their owners is the only thing I am criticising.
I mean, look:
> Making all companies state-owned might have some historically-evidenced downsides.
Where there do you read, "we should stop fining companies and holding their directors accountable"?
Added to my list of things to do if I ever become a dictator by chance.
There are lots of small, niche businesses that literally could not exist without this targeting.
e: Is the discussion in this thread really so without value that it should be hidden?
They were usually sued for corruption in developing countries to obtain contracts.
They were however sued in the US even though they are not headquartered there, had to pay huge fines that brought said companies to their knees and were later, surprisingly, bought by American companies.
Yes, the operation failed in the case of Airbus because they were smart enough to raise the issue themselves in the UK to avoid being sued in the US.
Alstom was bought by GE and Technip was bought by FMC Technologies.
> and also they literally were bribing politicians
Something that no US company has done in developing countries I'm sure.
In the case of GDPR-fines companies are literally laundering use data.
> In the case of GDPR-fines companies are literally laundering use data.
They are using the data in compliance with their ToS, which is decided post-facto to be in violation of the GDPR. The level of regulatory uncertainty there is far from the clear-cut “don’t bribe politicians.”
Could you give me some examples?
Also, US suing EU companies for things happening in developing countries is a mind blowing overreach of US territorial jurisdiction.
> They are using the data in compliance with their ToS
A ToS isn't a law.
> which is decided post-facto to be in violation of the GDPR
No. GDPR was introduced and companies were given years to adapt and become compliant.
> The level of regulatory uncertainty there is far from the clear-cut
This is also wrong. You can simply ask the EU member country's national agency responsible for the enforcement of the GDPR proactively.
> The level of regulatory uncertainty there is far from the clear-cut “don’t bribe politicians.”
In countries that run on bribes this becomes less clear.
I don't see it as overreach that the US does not let foreign companies that pay bribes compete in the US. Given that US companies cannot pay bribes legally, it would be hard for them to compete domestically with companies that can bribe simply because they are headquartered elsewhere.
> This is also wrong. You can simply ask the EU member country's national agency responsible for the enforcement of the GDPR proactively.
I am going to assume this one is a joke given the consistency (or lack thereof) of GDPR guidance from European regulators.
They were fined a third of what Alstom while having double the revenue.
This only happened because both Brazil and Algeria got involved.
> I don't see it as overreach that the US does not let foreign companies that pay bribes compete in the US.
But this is not competition in the US, it's competition abroad.
> Given that US companies cannot pay bribes legally
Which like Honeywell we know they absolutely do like every company operating in developing / BRICs countries.
> I am going to assume this one is a joke given the consistency (or lack thereof) of GDPR guidance from European regulators.
Yes and I'm sure that Google, Facebook & co were only caught on "technicalities" because the law wasn't "clear enough". If that is not a joke I don't know what is ...
I think you have a flawed conception of how fines are supposed to work…
> But this is not competition in the US, it's competition abroad.
Of course it is about competition in the US, otherwise they could freely exit the US market and not pay shit.
> Yes and I'm sure that Google, Facebook & co were only caught on "technicalities" because the law wasn't "clear enough". If that is not a joke I don't know what is ...
I mean, this whole conversation is about whether they are being targeted by regulators - your statement is question-begging.
Fine amounts are not related to company revenue but it gives you an idea of the impact it might have on the company and the sentencing differences when we are talking about an American company vs a foreign company.
> Of course it is about competition in the US, otherwise they could freely exit the US market and not pay shit.
No it's not. The only reason these companies comply is that the US has retaliatory tools outside of the US that are very powerful.
It has nothing to do with American contracts which represented a minor share of the revenue in the case of Alstom.
> I mean, this whole conversation is about whether they are being targeted by regulators - your statement is question-begging.
Yes, because they simply broke the law.
I mean Google is still sending data back to the US while this has been illegal since 2020.
And European companies are also sued for breaking GDPR. Recently, the CNIL fined Criteo, a French adtech company, for 40M€. Multiple other fines in the 1M+€ range (Carrefour, Total, AG2R…) for French companies.
You can go on Enforcement Tracker, you will find a lot of small fines against EU entities, and few but heavy fines against US entities. I don't think this is protectionism, but rather that EU companies fare better than US companies in environments with historically strong privacy laws, precisely because they are subject to these regulations from day 1.
> They are using the data in compliance with their ToS, which is decided post-facto to be in violation of the GDPR.
A ToS is a contract, and contracts can violate the law. Nothing surprising here.
Here is a quote from an MEP who helped design the EU DMA on deciding who counts as a gatekeeper:
"Let’s focus first on the biggest problems, on the biggest bottlenecks. Let’s go down the line—one, two, three, four, five—and maybe six with Alibaba. But let’s not start with number seven to include a European gatekeeper just to please Biden.”
It is hard for me to read that as suggesting anything but strongly protectionist motivations.
> A ToS is a contract, and contracts can violate the law. Nothing surprising here.
I don't disagree, merely with the suggestion that the regulatory framework the EU has set up, which is still actively being worked out in a patchwork of procedural decisions up until literally today, is as clear-cut as the US prohibition on bribery in the FCPA.
And when they do, I always click "reject all". I think most people would - which is why I guess some sites still try to use those dark patterns. I'm still waiting for a big regulatory fine to make an example. If a known company is fined almost out of existence due to lack of a reject button, I think there would be instant self-regulation here.
> For me anyway GDPR has been largely a waste of bureaucracy, a better effort would be to educate populous about what cookies are and how tracking works and the extent of the trackings etc - these stuff should be in High School curriculum already by now.
Don't confuse the GDPR with "cookie banners" though. That's the end user visible tip of the iceberg. The biggest premise (and in my opinion the genius of the regulation) is that the end user is not required to know or understand anything. Instead, the people handling their data should. And if nothing else, it really has forced everyone (often even outside the EU) to think twice about how their data is stored and retained. And that's huge positive even if cookies were never a thing in gdpr.
Didn’t the EU recently cut a deal where the data from EU can be transferred to US without any legal ramifications [1]? So then this just goes to show it’s just about adding another layer of bureaucracy instead of caring about protecting user data.
[1] https://www.politico.eu/article/eu-signs-off-on-data-transfe...
They are basically being forced to separate the part of their business that actually makes money from the part that users like and then forced to lose money on those users.
I would be fine about laws requiring facebook to be up front and clear about how they are using this data, but mandating free rider status seems a step too far.
While I don't think it will work on the scale FAANG wants (see e.g. Youtube premium), what is the legal roadblock to let users chose between tracking or paying for the service?
In Germany too, if I remember correctly.
But if you are so sure about this, please sue so we can get rid of these cookie walls!
It also requires a court to decide that your fee is a “reasonable” one and you cannot just refuse access outright - you must make your content available to the non-consenting user.
Regardless, all of this will be illegal anyways once the DMA comes into effect. And I still think, national exceptions aside, that my description of the current state of EU law was accurate:
"The prevalent regulatory approach in Europe is that currently advocated by the European Data Protection Board ('EDPB') in its Guidelines 05/2020 on Consent under Regulation 2016/679 whereby the EDPB provides in no uncertain terms that '[i]n order for consent to be freely given, access to services and functionalities must not be made conditional on the consent of a user to the storing of information, or gaining of access to information (paragraph 39 of the Guidelines)'." [0]
[0]: https://www.dataguidance.com/opinion/france-cnil-opens-door-....
The regulation is very clear: non-functionally-essential data processing requires explicit consent. If in doubt, err on the side of caution and use consent and opt-in rather than another legal basis such as legitimate interest. Business models based on stalking or spamming are no longer allowed.
Keep in mind that the objective of the regulation is not some punitive shake-down but to give people rights on how their data is used. A good-faith effort that accidentally falls short will be given guidance and a reasonable timeline to implement changes - there's no risk to ever get a fine as long as you err on the side of caution. You can also proactively ask your local regulator for guidance if something is unclear.
As I have said, this model attempts to enshrine free ridership, which might work while there is the rest of the world subsidizes it, but it is not a sustainable model to force tech companies to serve users at a loss.
The objective of the DMA which will serve to enshrine the illegality of these models is to target American tech companies and European legislators have explicitly stated as such.
No it doesn't - you can still charge for a service.
It just makes stalking/spamming an unviable method of payment.
Free access to global communication is not a bad thing.
But this is besides the point: the guidance is absolutely not clear and if local regulators cannot even get their story straight I am not sure how you expect foreign companies to figure it out. And collecting information about how users use your property is not stalking.
Advertisers aren't charities and the purpose of advertising is ultimately to drive profit. Subsidizing poor people is not in their interest.
The fact that poor people can currently access things for free is a result of imprecise targeting. If there was a way for advertisers to reliably tell apart poor people from the rich ones they'll happily block the poor ones.
Without laws like the GDPR in place to curtail data collection and profiling, it's only a matter of time before more and more data is collected to enable this kind of targeting and lock out poor people too.
> Free access to global communication is not a bad thing.
Global communication being subsidized (and thus controlled) by a handful of commercial interests is very dangerous.
> And collecting information about how users use your property is not stalking.
I'm not talking about basic self-hosted (very important difference!) web analytics or server logs here, I'm talking about large-scale stalking such as what Google/Facebook or any major ad provider does. The information they collect go way beyond what the user does on their platforms.
You are absolutely wrong about that and you do not understand the business model. I am not saying it has anything to do with the goodness of their heart but this is absolutely not something that would be in their interest. They benefit from the networks effects just like the users do.
> Advertisers aren't charities and the purpose of advertising is ultimately to drive profit. Subsidizing poor people is not in their interest.
It is possible for self-interested action to have knockoff positive effects. In fact, it is actually quite common: most exchanges are mutually beneficial.
> I'm not talking about basic self-hosted (very important difference!) web analytics or server logs here, I'm talking about large-scale stalking such as what Google/Facebook or any major ad provider does. The information they collect go way beyond what the user does on their platforms.
If you read my original comment, you would see that I am in favor of banning cross-site stalking but that is both not what Meta is being fined for here and not the only thing the GDPR/DMA prohibits.
Targeting based on only your own platform is a good middle ground.
I think it's still a problem because it's a grey area as to what "own platform" means exactly. Malicious actors will stretch that definition beyond what's reasonable.
Publicly-available data posted by the user seems fair, but things like scroll position, or the time you read a particular item, or forms typed but not submitted (all things I'm sure Facebook is absolutely collecting via client-side JS) should not be considered fair.
Either way, I'm personally in favour of ad-based business models getting shut down/being made unprofitable as it will ultimately realign the incentives, surface the true price of platforms and mean that we can finally have communication/entertainment tools that are designed with those primary purposes in mind as opposed to spam machines with the bare minimum amount of functionality sprinkled in. I want our online public squares to be accountable to their end-users rather than advertisers, and facilitate communication rather than outrage (what they call "engagement").
Not illegal then.
> The difference between targeting and not is the different between net profit or not for many users
I don't think it's a bad idea to have regulation that makes entire regions of an industry unprofitable over night, if that's what it takes.
Citation very very much needed as that is not at all what standard economic theory would predict.
As I said, there are lots of niche small businesses that literally could not survive without targeted advertising so that demand goes away as soon as these bans go into effect.
> I don't think it's a bad idea to have regulation that makes entire regions of an industry unprofitable over night, if that's what it takes.
Yes but I think if the choice were actually presented as “pay for FB or repeal this regulation” and the EU had a referenda on it, the regulation would be banned. The only way this is getting through is because the public is being convinced that they can have their cake and eat it too. They might be right, but only because they are being subsidized by users in the rest of the world.
That was assuming that the total ad spend is constant as a fraction of revenue and that revenue would be unchanged. If less effective ads overall would lead to lower revenues then the ad spends would shrink. But they would shrink equally for everyone, at least.
> there are lots of niche small businesses that literally could not survive without targeted advertising
There is nothing banning targeting. The problem is using info that users don't know/think is used for targeting, and using it for targeting. I'd be happy to take a 200 question survey as a condition for using facebook, where they ask me about my hobbies and whereabouts and clearly say it's for ad targeting. Obviously I could say "I'd rather not tell" instead of "I like guitars", but in such a scenario I'd happily give up my targeting info. But I don't want to be shown a guitar ad because I looked at one on an unrelated site with a facebook tracking pixel on it. It's absolutely dystopian.
> public is being convinced that they can have their cake and eat it too.
Yes I'm sure many think that. But I think the only way of changing the status quo is through heavy handed regulation and making initially impopular decisions and risking the death of a lot of business in the process.
Facebook are the ones who've structured their business like this though — they could profitable with a subscription model instead, they've just chosen to make their product free at the point of use.
There was a recent decision in France suggesting otherwise, but this is not the opinion of the primary EU regulatory guidance nor has it been seriously tested. Either way, it will become fully illegal to refuse under the DMA.
[0]: https://www.dataguidance.com/opinion/france-cnil-opens-door-....
A service provider must provide its offerings regardless of the user accepting to be tracked or not. The provider is not even allowed to make it cumbersome to opt out.
If Meta doesn't like it they're free to either be fined into oblivion or, alternatively, to just fuck off from the European market.
The law in question is quite unambiguous.
I mean, obviously they are compelled to do that and this is completely fine.
As users people should not be blackmailed into accepting psychological manipulation in their lives, just to be allowed to use a service. If Facebook's model for profit is so bad, that they cannot profit without manipulation, then perhaps their whole business is a shady one and they should start asking for membership fees. I could not care less, whether they need their pesky ads or the data from people viewing and interacting with them. Without consent they don't belong on the users' screens, end of story. If they cannot do business ethically, I wish they would not do business at all.
> I would be fine about laws requiring facebook to be up front and clear about how they are using this data, but mandating free rider status seems a step too far.
It has nothing to do with "free riding". They offer a service and that service should be worth its weight to the users. If it isn't, then apparently it is not a good enough service. To get back the money through the back door, by utilizing manipulation of users and spreading hate-speech for engagement metrics is not OK.
The fines seem to be leveled at Meta's local company in Norway. As I understand it, fines are not deductible in Norway.
(I am not an accountant, and my company has never gotten a find, but looking up this in the accounting system I use, it seems it is not deductible: https://kontohjelp.fiken.no/as/medMoms/7799?sok=7799 ( in Norwegian)).
If a company tried I think it should be viewed as contempt of court. A company trying to get money back for which it was fined would basically be them thumbing their nose at the fine. Maybe that is why fines are not deductible.
This kind of thing, even though the details are different, is also why Kim Dotcom got arrested for violating US law despite not being in the US.
I'm also not sure if the courts in the US default to cooperating in such situations; I seem to remember something about Congress passing a law saying that Americans didn't need to pay fines for (libel?) imposed by (UK courts?) or something like that, suggesting that such was the default before then.
Instead fine them in the billions of dollars and at most in the tens of billions for repeated violations and privacy breaches just like what is happening to Google. [0]
[0] https://www.theverge.com/2023/8/7/23823878/google-privacy-tr...
* 98,500 a day = $35 million per year
* $35 million / (5 million Norway population * 85% assumption) = $8 / year fine per Norway user.
* I can't find Norway-specific revenue, but Meta's average revenue per user is $18 across Europe, but Norway could be higher than average. Outside Europe the highest is USA at $60. Assuming revenue / user is half way between this - $39 - this fine would be 20% of revenue.
* $39 per user would mean total revenue of $200m in Norway.
* Facebook turns 32 billion of revenue into 7.79 billion of net profit (24% of revenue to Net profit). This would mean profit of c£47m in Norway before the fine, and $12 billion after-fine.
This is with a fairly optimistic view of revenue per user - at the Europe average of $18 per user it would be a loss of $13m.
Another way to look at this is that if you population-adjust the fine to the world, it would be c$60 billion per year (although this is less accurate as it does not account for the fact that many regions have less users or are less profitable). Either way, Facebook can handle these fines in a handful of regions, but they can't handle these fines in all regions.
Just need EU countries to work together in a coordinated way so it starts having an effect on quarterly results. Rather than each fine being picked off one at a time.