THE 10 percent fine that Meta Platforms (formerly Facebook) faces in South Africa should act as a deterrent to big tech from acting in a way that stifles start-ups, innovation, and competition, GovChat founder and chief executive Eldrid Jordaan said yesterday.
He was responding after the Competition Commission announced this week that it had referred, Meta Platforms and its subsidiaries, WhatsApp Inc and Facebook South Africa (collectively referred to as Facebook) for abuse of dominance to the Competition Tribunal for prosecution. The Commission had recommended a fine of 10 percent of local turnover.
Jordaan said the case a was groundbreaking, as it was one of the few abuse of dominance cases ever to be prosecuted by the South African Competition Commission, and the first of its kind involving digital platforms and marketplaces.
The case echoes the US Department of Justice (DoJ) Antitrust Division’s recent case filed against Meta for; “its strategies to eliminate start-ups that rely on Meta platforms and ecosystem to offer and innovate upon their services, before they are able to become a threat to Meta’s dominance.”
WhatsApp have defended their actions, with a spokesperson this saying the platform was “simply looking to apply its terms and conditions fairly,” and that there was “no evidence whatsoever to suggest that WhatsApp has tried to exclude any firm from the market or engaged in anticompetitive conduct”.
“GovChat is a private, for-profit company, operating in a highly competitive market. It knowingly provides messaging services which do not comply with the WhatsApp Terms of Service… GovChat broke these terms by signing up organisations to the WhatsApp API without going through our on-boarding process. This is required for all organisations who wish to use our service and means we know who is using our services and that organisations agree to our privacy practice,” WhatsApp said.
“GovChat has repeatedly refused to comply with our policies that are designed to protect citizens and their information, preferring to prioritise its own commercial interests over the public,” WhatsApp said.
Jordaan said GovChat was an “Open Government Partnership with the Department of Co-operative Governance and Traditional Affairs,” and that they were “grateful for the opportunity to continue to serve the nearly, 9 million citizens, and residents who use GovChat as their point of engagement, and touch point.
GovChat had thus far, among its various applications, created a platform that enabled people to digitally access social services, including the processing of 13 million Social Relief of Distress (SRD) grant applications.
It had also, in partnership with the Department of Health and other private sector partners, provided 7 million citizens, and all who had tested for Covid-19, a secure and reliable way of receiving their test results on their devices, regardless of whether they tested at a public or private healthcare facility.
Jordaan said the fine would “set a precedent for South African start-ups to continue on their mission, regardless of the headwinds”.
Meanwhile, on Tuesday, Meta was fined €17 million (R281m) by the Irish Data Protection Commission for a different case, failing “to have in place appropriate technical and organisational measures”, into possible information breaches that affected as many as 50 million accounts.
BUSINESS REPORT ONLINE