Meta challenges Ofcom’s methodology for fees and fines in Britain — Channel NewsAsia

Meta, which owns Facebook and Instagram, has challenged in London’s High Court the methodology used by UK regulator Ofcom to calculate fees and potential fines under the Online Safety Act. The company considers the regulator’s approach disproportionate, Channel NewsAsia reports.

Dispute over global revenue

The Online Safety Act 2023 allows Ofcom to impose fines of up to 10% of a company’s qualifying worldwide revenue or up to £18 million, whichever is greater. The regulator can also recover the costs of operating this regime through fees calculated with regard to companies’ revenues.

Meta’s claim concerns the use of global rather than only UK revenue to determine fees and the maximum possible fines. In its legal position, Meta said that Ofcom had exceeded its powers by defining qualifying worldwide revenue too broadly. The company also objects to the procedure for calculating fines in cases where two or more service providers belonging to one organisation are jointly liable for a violation.

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The regulator’s position

Ofcom insists that its approach is proportionate and provides for a carefully balanced definition of qualifying revenue. In court documents, the regulator stated that worldwide revenue is used only to set the maximum level of a potential fine, while the actual fine must be proportionate to the violation.

The court hearing began a week after Ofcom opened an investigation into whether Meta had properly assessed the risks of the Instagram Instants feature before its launch in May. Last week, Meta, along with TikTok and X, also took part in a separate hearing concerning the scope of information required by the regulator.

Meta said it seeks to cooperate constructively with Ofcom but considers the decisions on the methodology for calculating fees and possible fines disproportionate. The company believes that such payments should be based on services regulated in a particular country.