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Instagram Hit With a Huge Fine For Failing to Protect Teens

Irish regulators fined Instagram parent Meta Platforms for a privacy issue the company says it fixed a year ago.
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Europe has been increasing its fines as regulators crack down on American tech companies.

Italy slapped Amazon  (AMZN) - Get Free Report with a $1.3 billion fine for crowding out its competitors by favoring third-party sellers that use the company’s logistics services.

Earlier this year, the EU Commission adopted the Digital Markets Act, which aims to make the tech sector "fairer and contestable" by creating a segment for large tech companies called "gatekeepers."

"Large gatekeeper platforms have prevented businesses and consumers from the benefits of competitive digital markets. The gatekeepers will now have to comply with a well-defined set of obligations and prohibitions," the EU said as it expects the text of the bill to be adopted in September or October.  

Alphabet's  (GOOGL) - Get Free Report Google is still fighting a $1.6 billion (1.49 billion euro) fine imposed by EU antitrust regulators from three years ago.

The EU charged Google with hindering online search advertising from rivals.

That fine is just one of three actions the EU has taken against the internet giant, totaling $8.8 billion (8.25 billion euro).

Instagram's Ireland Fine

Meta Platforms  (META) - Get Free Report, the parent company of Facebook and Instagram, is being fined €405 million ($402 million), the second largest fine ever issued under the EU's privacy rules, Irish regulators told the press this week. 

Ireland's Data Protection Commission said that it made a final decision last week but that it wouldn't release the full details of the fine until next week, according to the Associated Press

The DPC accused Meta of allowing users aged 13 to 17 to operate business accounts on the platform that violated privacy rules by displaying contact information, like phone numbers and email addresses, for minors.

"We disagree with how this fine was calculated and intend to appeal it," Meta told the AP. The company says it engaged fully with regulators throughout the investigation and that the Irish agency erred in calculating its fine because it made changes to its privacy policy a year ago. 

In 2021, the DPC  fined WhatsApp 225 million euros ($267 million) for breaching its data protection rules, following an investigation that began in 2018. 

Ireland fines Meta on behalf of the EU since the company's European headquarters are located in Ireland. 

Meta missed out on having the largest fine in EU history. 

Last October, Amazon appealed its own 746 million euro ($865 million) fine for violating the European Union's data-protection rules. 

Facebook's Fallout in Europe

Ad revenue in Europe fell 12% year over year in the third quarter, three times as much as it fell in North America. Overall, ad revenue from Meta's "family of apps" fell 1% in the second quarter to $28.2 billion. 

Meta's European business saw declines in both daily active users and monthly active users sequentially. 

The company said that its European business was negatively impacted by Russia's decision to block access to Meta apps after the company decided to allow Facebook and Instagram users in other countries to call for violence against Russians and Russian soldiers over the invasion of Ukraine, Reuters reported

From the first days of the Russian war on Feb. 24, Facebook found itself under pressure from the Ukrainian authorities to block Russian outlets disseminating President Vladimir Putin's propaganda on its platforms.

The company, which wants to show it has learned the lessons of its past controversial practices, reacted promptly by announcing it had detected and blocked Russian networks.