Meta Challenges Ofcom Over Online Safety Act Penalty Calculations
Meta has initiated a judicial review against the UK's Ofcom, challenging the regulator's method of calculating potential fines and fees based on global revenue rather than UK-specific earnings.
Meta has launched a formal legal challenge against the UK communications regulator, Ofcom, seeking a judicial review in the High Court regarding the methodology used to calculate regulatory fees and potential penalties under the UK’s Online Safety Act. The dispute centers on the regulator's interpretation of "qualifying worldwide revenue," which serves as the basis for determining fines that can reach up to 10 percent of a company's global turnover or £18 million, whichever is higher The Register.
The core of Meta’s argument is that Ofcom’s current approach is fundamentally disproportionate. Meta contends that fees and penalties should be calculated based on revenue generated specifically from regulated services within the United Kingdom, rather than the company’s total global income. Given that Meta reported approximately $201 billion in global revenue last year, the company argues that applying the 10 percent threshold to its worldwide earnings results in astronomical figures that do not accurately reflect its UK-specific operations The Register.
Beyond the global versus local revenue debate, Meta has raised two additional objections. The company is challenging the regulator's practice of treating multiple services under a single corporate umbrella as jointly liable, which could expose the entire organization to larger penalties. Furthermore, Meta objects to the aggregation of revenue across different services, arguing that the regulator should assess each service individually rather than grouping them together for the purpose of calculating financial liabilities The Register.
Ofcom has signaled that it intends to contest the challenge, maintaining that its methodology is based on a "plain reading of the law." An Ofcom spokesperson expressed disappointment regarding Meta’s objection to the fee structure, stating that the regulator will "robustly defend our reasoning and decisions" in court. Meta, meanwhile, maintains that it remains committed to cooperating with the regulator but insists that the current enforcement framework is excessive The Register.
This legal battle highlights the ongoing tension between Silicon Valley tech giants and the UK government over the implementation of the Online Safety Act. The legislation has previously drawn criticism from US politicians and free speech advocates concerned about the scope of Ofcom’s authority. The regulator has already begun exercising its new powers, having recently issued its first fine under the regime against 4chan and threatened action against X regarding sexually explicit AI-generated content The Register.
As the High Court prepares to review the case, the outcome could set a significant precedent for how international tech firms are held financially accountable under UK law. The dispute underscores the broader challenge of applying national regulatory frameworks to global digital platforms, a conflict that is likely to intensify as regulators continue to test the limits of their enforcement capabilities The Register.