Tag: technology

African antitrust authority fines META quarter-billion dollars — WhatsApp (with that?)

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Nigeria’s FCCPC has imposed a U.S. $220m fine on WhatsApp’s parent company Meta for violating data privacy laws, continuing the FCCPC’s consumer-protection streak

When it rains, it pours. And when the nascent FCCPC (on whose relatively youthful existence we have reported extensively) issues a fine on a global mega corporation like META (or BAT to the tune of $110m), then it really reaches deep into its pockets: Mr. Zuckerberg’s conglomerate will have to pay $220m to resolve an extensively-documented violation abusing its dominant position, exploiting Nigerian WhatsApp users’ personal data, which it had stored in Singapore, Europe and the U.S. The proceedings were brought approximately 3 years ago, culminating in a particularly in-depth Report issued by the FCCPC and the resulting fining decision last week, pursuant to both the Federal Competition and Consumer Protection Act, 2018 (FCCPA), and the Nigerian Data Protection Regulation, 2019 (NDPR).

At the heart of the allegations lies Meta’s undisclosed, apparent dual-use of WhatsApp user information and metadata (no pun), across virtually all of its conglomerate digital platform companies — i.e., data-sharing conduct squarely in violation of the NDPR and, so says the FCCPC, without consumer knowledge and in many cases against WhatsApp users’ wishes.

Andreas Stargard, a competition lawyer at Primerio Ltd., with a focus on African antitrust cases, comments as follows on this latest record-setting West African case:

“This latest foray by the FCCPC against Meta is notable for multiple reasons: First, it spans both the inaugural aegis of the FCCPC under internationally lauded former FCCPC chief, Babatunde Irukera, and that of his recent successor, Tunji Bello.

Secondly, it represents a new record, and quite literally a doubling of the last record fine, namely the $110m agreed-upon antitrust settlement against British American Tobacco less than 2 years ago.

Third, it shows a trend we have recently noticed in the African government enforcement world: namely, the intertwined nature of competition law and consumer-protection issues, which the detailed Report issued by Commission staff highlights in a significant way. Other agencies on the continent will surely take notice and (we hope) issue similarly-documented case reports going forward.

Fourth, and finally, setting aside the amount of the fine, this matter shows how African jurisdictions may well be ahead of some European and other peer institutions. This is a milestone development for the future regulation of digital behemoths across Africa. The detailed report and analysis provided publicly by the Nigerian agency shows that its nascent competition-law regime continues to be eager to comply with global best practices and appears well situated to keep earning the respect of its Western and other African peer authorities, akin to the journey that the COMESA Competition Commission has undertaken in its first 10 years of existence. Both agencies have gone from non-existent to generally and globally respected African antitrust and consumer-protection powerhouses.”

The Commission’s release noted that “[t]he totality of the investigation has concluded that Meta over the protracted period of time has engaged in conduct that constituted multiple and repeated, as well as continuing infringements… particularly, but not limited to abusive, and invasive practices against data subjects in Nigeria. Being satisfied with the significant evidence on the record, and that Meta has been provided every opportunity to articulate any position, representations, refutations, explanations or defences of their conduct, the Commission have now entered a final order and issued a penalty against Meta.”

COMESA Competition Chief Approves of FDI, M&A Transactions

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Lipimile Advocates for Foreign Direct Investment, Encouraging Acquisition-Hungry Multi-Nationals in Recent COMESA Trade Remarks

In a comment on the COMESA Simplified Trade Regime (STR) regional programme, recently being implemented locally in the border region between Rwanda and the DRC, George Lipimilie, the Chief Executive Officer of the COMESA Competition Commission, stated that the regional body’s “focus on free movement of goods has generally paid dividends resulting in [] a lot of cross-border mergers and acquisitions,” according to an article in the Rwanda New Times.

George Lipimile of the COMESA Competition Commission

It appears that the CCC chief is expressly favouring foreign direct investment into the region by way of mergers (or perhaps more accurately, acquisitions).  “This is particularly so where the ‘foreign’ (presumably implying non-COMESA) multi-national entity brings with it novel technologies or R&D to improve the market position of the local competitor,” according to Andreas Stargard, a Pr1merio Ltd. competition-law practitioner.

Of interest to M&A practitioners, Mr. Lipimile is quoted as saying: “There are situations when foreign companies use acquisitions to enter the market where you find a multinational company buying a local company which is good because it comes with a lot of technology.” (Emphasis added).

Mr. Lipimile was also rather specific about encouraging FDI in the region’s raw-materials sector from nation states other than the PRC: said Lipimile, “[w]e have seen China taking advantage of our raw materials and we hope more countries can follow suit.”

We note that the domain of international trade — specifically tariffs as barriers to trade — has historically not been within the jurisdictional purview of the COMESA Competition Commission, which was designed to be a competition-law enforcement body.  Technically, there exists the post of COMESA Director for Trade, Customs & Monetary Affairs, held by Dr. Francis Mang’eni and not by Mr. Lipimile.  The CCC, however, “has recently emerged to take a more active role within the COMESA architecture of regional enforcement institutions,” Mr. Stargard says.  He notes that Article 4 of the COMESA Treaty expressly provides that “[i]n the field of trade liberalisation and customs co-operation [the Member States shall] (a) establish a customs union, abolish all non-tariff barriers to trade among themselves”, and that the regional Competition Regulations expressly bestow the CCC with the authority to investigate and abolish all “anti-competitive practices affecting COMESA regional and international trade.”