WhatsApp expected higher fine from Data Protection Commission

WhatsApp expected a heavier fine from the Irish Data Protection Commission than it received following a recent investigation, newly filed documents show.

The company’s Irish subsidiary increased provisions for liabilities to €246.2 million last year, up from €77.5 million in 2019, as it awaited a decision by the commission.

WhatsApp’s Irish unit estimated it would receive fines of between €245 million and €250 million, according to company accounts recently lodged in Dublin.

Data protection commissioner Helen Dixon earlier this month imposed a record €225 million fine on the company for “severe” breaches of privacy laws – but only after European regulators directed her to radically increase the penalty.

Ms Dixon had proposed a €30 million to €50 million fine on the company, which is owned by Facebook. WhatsApp meanwhile originally estimated that the penalty it would receive would be in the €35 million-€105 million range.

The company’s revised provision estimates are included in newly filed accounts that show turnover jumped by €111.6 million at WhatsApp Ireland last year, rising from €92.2 million in 2019 to €203.8 million a year later.

It said however that the rise in revenues was primarily driven by additional services fees from another group company as a result of the increase in provisions. Moreover, much of the gains were wiped out by a corresponding jump in administrative expenses, which rose from €93.9 million to €200 million.

WhatsApp Ireland returned to profit last year after chalking up a €1.7 million loss in 2019. It recorded pre-tax revenues of €3.2 million.

WhatsApp stablished an Irish subsidiary in 2017. Its key role is acting as the data controller for European users of the WhatsApp service, and for the provision of services to other group entities.

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The number of employees at the Irish unit more than doubled over the year to 45 from 20 with staff costs rising from €2.9 million to €6.97 million.

WhatsApp has said it disagrees with the Data Protection Commission’s decision, and claimed the penalties were entirely disproportionate. It has stated it will appeal the ruling.

Facebook acquired WhatsApp in a $19 billion deal in 2014 when it had just 14 employees and 420 million monthly users. It now has more than 2 million active users.


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