Meta Platforms, Inc. may face a fine in Taiwan this week for allegedly failing to disclose information about individuals funding advertisements on its platforms.

This could mark the second penalty under Taiwan’s Fraud Crime Hazard Prevention Act.

According to Deputy minister of the Ministry of Digital Affairs (MODA) Lin Yi-jing, the ministry recently received 23 new cases from the Ministry of the Interior concerning incomplete advertisement disclosures on Meta’s platforms.

It is unclear whether these cases involve Facebook or Instagram.

MODA officials said that Meta did not provide complete information about who paid for the advertisements and who benefited from them.

A decision regarding the penalty may be made as soon as this week, according to an unnamed MODA official speaking to local media.

If the fine is imposed, it would follow a NT$1 million (US$33,381) penalty issued in May for similar violations.

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🔗 Source: Focus Taiwan

🧠 Food for thought

1️⃣ Taiwan’s ad disclosure crackdown reflects a global shift toward platform accountability

Taiwan’s actions against Meta represent a growing global trend where regulators are holding platforms directly responsible for ad content, rather than just pursuing individual bad actors.

The NT$1 million (US$33,381) fine issued to Meta in May was Taiwan’s first enforcement under its anti-fraud act, establishing a precedent that platforms must verify who funds advertisements 1.

Similar regulatory approaches are evident worldwide, from the UK’s £500,000 Facebook fine related to Cambridge Analytica to GDPR enforcement actions that can reach €20 million or 4% of global turnover 2.

The penalties in Taiwan can escalate from NT$200,000 to NT$5 million for continued non-compliance, demonstrating an intentional regulatory framework designed to ensure platforms take verification seriously 1.

This shift toward platform accountability appears driven by the recognition that self-regulation has proven insufficient to protect users from fraudulent content in digital advertising.

2️⃣ Financial fraud epidemic drives regulatory intervention

Taiwan’s regulatory action comes amid staggering financial losses, with reports indicating Taiwanese victims lose approximately NT$400 million (US$13 million) daily to online scams 3.

Investigations identified nearly 59,000 scam advertisements on Facebook and Google over an 18-month period, with Facebook cited as a major platform for financial fraud 3.

These numbers parallel global trends, with consumers reporting over $1.2 billion in losses to social media fraud in 2022, highlighting the scale of the problem 4.

Taiwan’s Ministry of Digital Affairs Deputy Minister Lin specifically noted that fraudulent advertisements on Meta’s platforms often originate from users creating fan pages to publish promotional content, revealing how scammers exploit platform features 5.

The economic impact of these scams demonstrates why governments are increasingly willing to implement and enforce stricter disclosure requirements for digital advertising.

3️⃣ Tech regulation increasingly focuses on transparency requirements

Taiwan’s enforcement follows a pattern where regulators worldwide are implementing transparency mandates rather than content restrictions as their primary regulatory approach.

Similar to Taiwan’s requirements, the UK’s Advertising Standards Authority monitors over 50,000 pieces of content from influencers to ensure proper ad disclosure 6.

Meta’s new verification requirements for financial services advertisers in Australia (requiring “Paid for By” disclaimers) demonstrate the company is adapting to this regulatory environment, though implementation varies by market 7.

The focus on disclosure rather than outright prohibitions allows regulators to balance free expression concerns with consumer protection goals while placing responsibility on platforms to verify information.

This regulatory approach emphasizes informing consumers about who is behind advertising rather than limiting what can be advertised, which may prove more sustainable and effective than content-based restrictions.

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