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EU Court Adviser Supports WhatsApp in Privacy Fine Dispute

An adviser to Europe’s top court has backed WhatsApp in its appeal against the EU privacy watchdog’s decision to increase its fine for data privacy violations. The case stems from a 2021 ruling in which Ireland’s data protection authority fined WhatsApp 225 million euros ($242.2 million). The European Data Protection Board (EDPB) intervened at the time, compelling Ireland to raise the penalty.

WhatsApp had challenged the EDPB’s authority to impose such a directive, but a lower tribunal ruled in 2022 that the company lacked standing to sue the regulator directly. Advocate General Tamara Capeta of the Court of Justice of the European Union (CJEU) has now disagreed with that assessment, stating that WhatsApp’s challenge is valid and should be reconsidered. The CJEU is expected to issue its final ruling in the coming months.

Meta Reportedly Testing In-House AI Training Chipsets for the First Time

Meta has reportedly started testing its first in-house chipsets designed for training artificial intelligence (AI) models. These processors, developed under the Meta Training and Inference Accelerator (MTIA) program, mark a significant step in the company’s effort to reduce reliance on third-party chip suppliers. A limited number of these custom chips have been deployed for initial testing to evaluate their performance and efficiency. If the tests yield positive results, Meta is expected to scale up production and integrate these chipsets into its AI infrastructure.

According to a Reuters report, Meta has collaborated with Taiwan Semiconductor Manufacturing Company (TSMC) to develop these AI-focused processors. The company has reportedly completed the tape-out stage—one of the final steps in chip design—indicating that the project is moving closer to full-scale deployment. While testing is still in its early stages, Meta’s move highlights its commitment to developing proprietary AI hardware, potentially giving it more control over performance optimization and cost management.

This is not Meta’s first venture into AI chip development. Previously, the company introduced inference accelerators designed specifically for AI inference tasks. However, until now, Meta lacked in-house chipsets dedicated to training large-scale AI models such as its Llama family of large language models (LLMs). With these new processors, the company aims to enhance its AI capabilities while reducing dependence on external chip manufacturers like Nvidia and AMD.

If Meta successfully scales up production of its custom AI chipsets, it could lead to more efficient AI training, improved model performance, and lower operational costs. The move aligns with a broader industry trend where major tech firms, including Google and Amazon, are investing in custom AI chips to stay competitive in the rapidly evolving AI landscape. As Meta continues its AI hardware push, further details about its chip performance and deployment strategy are expected to emerge in the coming months.

Italy Targets Meta, X, and LinkedIn in Landmark Tax Case

Italy has initiated a landmark tax case, issuing VAT claims against Meta, X, and LinkedIn. The case, which could have widespread implications for the tech industry in Europe, challenges how social networks provide services and treat user data as taxable transactions.

Tax Claims Against Tech Giants

Italy’s tax authorities are claiming substantial amounts from the three U.S. tech giants: Meta (887.6 million euros), X (12.5 million euros), and LinkedIn (140 million euros). These claims span from 2015 to 2022, although the immediate focus is on the years 2015 and 2016, for which claims are set to expire soon.

The Controversial Issue: VAT on Free Services

The central issue in the case revolves around the way these companies provide access to their platforms. Italian authorities argue that the act of users registering on Meta, X, and LinkedIn should be considered a taxable transaction since it involves the exchange of personal data for access to membership accounts.

Meta has strongly opposed this view, asserting that providing access to online platforms should not be subject to VAT. LinkedIn and X have remained silent or unavailable for comment on the matter.

Potential Impact Across the European Union

The case could have wider ramifications across the EU, as VAT is a harmonized tax across member states. Experts suggest that the ruling may force tech companies to reconsider their business models, particularly those offering “free” services that require users to accept profiling cookies. This development could potentially extend to other industries, including airlines and publishers, which rely on similar business practices.

The Path Forward: Court or Settlement?

This is the first time that Italy has issued formal tax assessment notices without reaching a settlement agreement. The companies now have 60 days to appeal the claims, after which they may go to court—a process that could take up to 10 years in Italy. Alternatively, the tax authorities could drop the claims for technical or political reasons, or the companies could agree to pay some of the contested amounts while seeking further assessment from the European Commission.