Amazon slapped with record $887m fine for data privacy breach by EU agency

Amazon has been issued with a fine of $887m by a European privacy watchdog for allegedly violating the bloc’s data protection laws.

The fine, disclosed by Amazon on Friday in a securities filing, was issued two weeks ago by Luxembourg’s privacy regulator.

The Luxembourg National Commission for Data Protection (CNPD) said Amazon’s processing of personal data did not comply with the EU’s General Data Protection Regulation (GDPR). It has ordered Amazon to revise certain undisclosed business practices.

Amazon denied that there had been any kind of breach that would violate the GDPR rules. Amazon will appeal the fine and said in the filing it believed CNPD’s decision was without merit. It said, “The decision relating to how we show customers relevant advertising relies on subjective and untested interpretations of European privacy law, and the proposed fine is entirely out of proportion with even that interpretation.”

In addition to the €746m fine, the CNPD judgment requires “corresponding practice revisions,” Amazon said.

Separately, last fall the European Commission filed antitrust charges against Amazon over alleged misuse of data to use non-public information to favour Amazon’s own retail business over third-party partner merchants. That case could result in Amazon being fined up to 10% of its annual global revenue.

GDPR, which went into effect May 2018, mandates a company disclose what data it collects from users and what it does with that data. Companies also must allow users to download a copy of their data and delete any individual’s data on request or face steep fines. Under the GDPR, data protection watchdogs in Europe have the ability to fine companies as much as 4% of their annual global sales.

Globally, regulatory scrutiny of tech giants has been increasing following a string of scandals over privacy and misinformation, as well as complaints from some businesses that they abuse their market power. Alphabet’s Google, Facebook, Apple and Microsoft Corp have drawn heightened scrutiny in Europe. In December, France’s data privacy watchdog handed out its biggest ever fine of $118.82m to Google for breaching the nation’s rules on online advertising trackers.

While the Amazon fine is in the hundreds of millions, it will hardly cause the company much loss. Amazon posted its third $100bn quarter in a row, with revenue growing by 27% year over year to $113.08bn.

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