A recent report states that EU antitrust regulators are beginning to question if Facebook’s Libra digital currency could cause antitrust issues.
A recent report from Reuters states that the European Commission sent out a questionnaire earlier this month to a number of parties involved with Facebook’s new digital currency, Libra. The Commission gave those sent the letters two to three weeks to provide feedback on the questionnaire; now some are beginning to think that the E.U. could be preparing for a formal investigation into the digital currency.
Individuals with knowledge of the situation stated that the main focus of the E.U. competition enforcer’s investigation would likely be the use of consumer data. Facebook is working with 28 partners in a Geneva-based entity called the Libra Association which will govern and regulate the new cryptocurrency.
The questionnaire from the Commission stated: “The Commission is in particular concerned about the possible competition restrictions that may result from the Association, especially with regard to information that will be exchanged and the use of consumer data.” The Commission can fine companies up to 10 percent of their global turnover for breaching EU antitrust rules and order them to change business practices but declined to comment on the questionnaire or the Libra currency.
The Commission’s sudden interest in Libra comes following calls from politicians, bankers, and regulatory watchdogs to ensure that regulation of Libra is tight in order to avoid the disruption of the global financial system. The questionnaire also requested information on the scheme’s governance structure and to what extent is the project open to others.