In a first-of-its-kind regulatory action, Nigeria’s Federal Competition and Consumer Protection Commission (FCCPC) has imposed a $220 million penalty on Meta Platforms Incorporated for alleged discriminatory practices and misuse of Nigerian consumers’ data.
The fine, announced on Friday, follows an investigation by the FCCPC and the Nigeria Data Protection Commission (NDPC) into Meta’s conduct and privacy policies from May 2021 to December 2023.
The FCCPC’s investigation uncovered that Meta engaged in practices violating Nigerian data laws. Specifically, the commission accused Meta of unauthorized appropriation of personal data without consumer consent, discriminatory practices against Nigerian data subjects, and enforcing exploitative privacy policies.
Tekedia Mini-MBA edition 15 (Sept 9 – Dec 7, 2024) has started registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
Additionally, the investigation revealed that Meta abused its dominant market position by compelling consumers to accept non-compliant privacy terms, thereby infringing on their rights.
The decision is coming less than seven hours after the Federal High Court sitting in Abuja struck out an N30 billion alleged illegal advertisement lawsuit instituted against Meta Platforms Incorporated (owners of Facebook, Instagram, and WhatsApp platforms) and its agent AT3 Resources Limited by the Advertising Regulatory Council of Nigeria (ARCON).
A statement released by the watchdog said in May 2021, that it directed WhatsApp LLC and Meta Platforms, Inc. (formerly called Facebook Inc.) to defend themselves regarding its investigative report which detailed how their conduct allegedly violated relevant data laws.
Meta was said to have provided some information in response to the requests and summons under the joint investigation.
“Meta Parties by themselves, and retained counsels have also repeatedly engaged with, and met with investigators and analysts from the Commission, and the NDPC, including as recently as April 4, 2024,” the statement added.
The Commission said after its investigation, it found that Meta platforms, over a protracted period, have engaged in conduct that constitutes continuing infringements of the FCCPA and NDPR regulations.
“… particularly, but not limited to abusive, and invasive practices against data subjects/consumers in Nigeria, such as appropriating personal data or information without consent, discriminatory practices against Nigerian data subjects/consumers or disparate treatment of consumers/data subjects compared with other jurisdictions with similar regulatory frameworks, abuse of dominant market position by forcing unscrupulous, exploitative, and non-compliant privacy policies which appropriated consumer personal information without the option or opportunity to self-determine or otherwise withhold or provide consent to the gathering, use, and/or sharing of such personal data,” it said.
Other violation findings include, denying Nigerian data subjects the right to self-determine; unauthorized transfer and sharing of Nigerian data-subjects personal data, including cross-border storage in violation of then, and now prevailing law; discrimination and disparate treatment and abuse of Dominance.
“The Final Order of the Commission mandates steps and actions Meta Parties must take to comply with prevailing law and cease the exploitation of Nigerian consumers and their market abuse, as well as desist from future similar or other conduct/practices that do not meet nationally applicable standards and undermine the rights of consumers.
“The Final order also imposes a monetary penalty of Two Hundred and Twenty Million U.S. Dollars only ($220,000,000.00) (at prevailing exchange rate where applicable) which penalty is in accordance with the FCCPA 2018, and the Federal Competition and Consumer Protection (Administrative Penalties) Regulations 2020 (APR),” the commission said.
Meta engaged with the commission’s investigators and analysts, including as recently as April 2024. Despite this cooperation, the FCCPC concluded that Meta’s practices were abusive and invasive, leading to the imposition of the $220 million fine.
However, industry analysts doubt that Meta will pay the full penalty. They note that large multinational corporations like Meta often engage in prolonged legal battles over fines imposed by national regulators. Also, they have substantial legal resources and may contest the penalty in court, potentially reducing the final amount or overturning it altogether.
Additionally, enforcing such a penalty across borders involves complex legal and jurisdictional challenges. Given Meta’s global operations, the practicalities of enforcing the fine are fraught with difficulties. Analysts also speculate that Meta might negotiate with Nigerian authorities to reach a settlement, which could result in a reduced fine or other commitments to improve their practices.
The FCCPC’s decision comes at a time of heightened regulatory scrutiny on tech giants globally. The fine is seen by many as part of the increasing efforts by national regulators to hold these companies accountable for their practices, particularly concerning data privacy and consumer rights.