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Meta, the parent company of Facebook and Instagram, has been fined almost €400 million by the main privacy rights regulator for breaching them.

Some experts believe the move could threaten the company's main source of revenue.



On Wednesday, Ireland's Data Protection Commission imposed two separate fines - €210m on Facebook for breaching the bloc's landmark privacy rules and €180m on Instagram for similar breaches.

Ireland fines Meta €390m



The decision also orders Meta to bring its approach to handling user data into line with EU law within three months, which could have significant implications for how the two social networks use personal data for advertising, which is the main source of revenue for the $335 billion company.



Ahead of the EU General Data Protection Regulation (GDPR) coming into effect in May 2018, Meta introduced changes to its terms of service, making them available to users only if they agree that their data can be processed to provide precisely targeted advertising.



However, the Irish regulator found that Meta was effectively forcing users to accept these terms, arguing that it "is not entitled to use the legal basis 'contract' as providing a legal basis for the processing of personal data".



Meta said it would appeal the decision and that its approach was in line with European data protection rules.

"We strongly believe that our approach complies with the GDPR, which is why we are disappointed by these decisions and intend to appeal both the decisions on the merits and the fines."



Meta added: "These rulings do not prevent targeted or personalized advertising on our platform. The rulings only address which legal basis Meta uses to serve certain ads. Advertisers can continue to use our platforms to reach potential customers, to grow their business and create new markets."



However, according to legal experts and activists for the protection of personal data, the decision, if confirmed, could undermine Meta's business model, writes Bloomberg TV Bulgaria.



Austrian privacy campaigner Max Schrems said: "This is a huge blow to Meta's revenue in the EU. Now people have to be asked whether they want their data to be used for ads or not... The decision also ensures a level playing field with other advertisers who must also obtain consent to use the service".



Jonathan Compton, a partner at London law firm DMH Stallard, said: "The deeper problem for Facebook, which relies on personalizing ads for users for around 80% of its revenue, is that this case strikes at the heart of that model, as effectively deprives technology companies of the ability to use personal data to tailor advertising products to individual users if that means collecting their user data to do the tailoring."



Meta has been fined approximately €1.3 billion in Ireland in five different cases in less than two years.

In addition to the financial burden on Meta, the fines highlight disagreements over how privacy rules are applied in Europe.


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