JAKARTA: Facebook Inc. has received an in-principle approval to set up a domestic unit in Indonesia, said a senior government source from the Southeast Asian nation, home to the social networking giant’s fourth-largest user base.
Indonesia has been pushing multinational technology firms to be locally incorporated, arguing that companies such as Alphabet Inc.’s Google set up small business entities to provide “auxiliary” services and get away with minimal taxation while booking most of their revenue from the country elsewhere.
In fact, Google has been locked in a months-long dispute over allegations by Indonesia’s government that the search giant had not made enough annual payments. The outcome of this is expected to indicate how the government may pursue others such as Facebook and Twitter Inc. for taxes.
Facebook is now in the process of establishing a local unit in the country, said the senior government source, who has direct knowledge of the matter but declined to be identified as the information was not public. The social media giant currently operates in Indonesia through an office in central Jakarta.
Indonesia had 69 million monthly active Facebook users as of the first quarter of 2014, placing the country fourth globally after the US, India and Brazil, according to data from the company.
Facebook did not respond to requests for comment and has not provided an update on the number of its users in Indonesia.
The office that Facebook opened in Indonesia 3 years ago allows it to work with advertisers as well as small- and medium-businesses “that need an education on how to market their products,” a Facebook executive told local media at the time.
But according to an official at Indonesia’s Communications Ministry, “Facebook only appoints people in Jakarta when the need arises, no more than that. Whether they have a permanent office here or not, we do not even know.”
Indonesia is eager to ramp up tax collection to narrow its budget deficit and fund an ambitious infrastructure program. Other governments around the world are also seeking to clamp down on what they see as corporate tax avoidance.
Last week, the communications minister said Google’s Asia Pacific headquarters had agreed on future tax payments in Indonesia. But he declined to comment on whether they had resolved their dispute over taxes for past years.
It was also unclear if Google would set up a domestic unit that is separate from its existing local entity, PT Google Indonesia, which tax officials allege simply acts as a sales service provider.
Indonesia’s tax office estimates the total advertising revenue for the industry in the country at around $830 million, with Google and Facebook accounting for around 70 percent.
However, Google has pointed to a joint study by the firm and Singapore state investor Temasek that estimated the size of Indonesia’s digital advertising market at $300 million for 2015.
‘Facebook gets initial approval to set up local unit in Indonesia’
‘Facebook gets initial approval to set up local unit in Indonesia’
Grok faces more scrutiny over deepfakes as Irish regulator opens EU privacy investigation
- The regulator says Grok has created and shared sexualized images of real people, including children. Researchers say some examples appear to involve minors
- X also faces other probes in Europe over illegal content and user safety
LONDON: Elon Musk’s social media platform X faces a European Union privacy investigation after its Grok AI chatbot started spitting out nonconsensual deepfake images, Ireland’s data privacy regulator said Tuesday.
Ireland’s Data Protection Commission said it notified X on Monday that it was opening the inquiry under the 27-nation EU’s strict data privacy regulations, adding to the scrutiny X is facing in Europe and other parts of the world over Grok’s behavior.
Grok sparked a global backlash last month after it started granting requests from X users to undress people with its AI image generation and editing capabilities, including putting females in transparent bikinis or revealing clothing. Researchers said some images appeared to include children. The company later introduced some restrictions on Grok, though authorities in Europe weren’t satisfied.
The Irish watchdog said its investigation focuses on the apparent creation and posting on X of “potentially harmful” nonconsensual intimate or sexualized images containing or involving personal data from Europeans, including children.
X did not respond to a request for comment.
Grok was built by Musk’s artificial intelligence company xAI and is available through X, where its responses to user requests are publicly visible.
The watchdog said the investigation will seek to determine whether X complied with the EU data privacy rules known as GDPR, or the General Data Protection Regulation. Under the rules, the Irish regulator takes the lead on enforcing the bloc’s privacy rules because X’s European headquarters is in Dublin. Violations can result in hefty fines.
The regulator “has been engaging” with X since media reports started circulating weeks earlier about “the alleged ability of X users to prompt the @Grok account on X to generate sexualized images of real people, including children,” Deputy Commissioner Graham Doyle said in a press statement.
Spain’s government has ordered prosecutors to investigate X, Meta and TikTok for alleged crimes related to the creation and proliferation of AI-generated child sex abuse material on their platforms, Spanish Prime Minister Pedro Sánchez said on Tuesday.
“These platforms are attacking the mental health, dignity and rights of our sons and daughters,” Sánchez wrote on X.
Spain announced earlier this month that it was pursuing a ban on access to social media platforms for under-16s.
Earlier this month, French prosecutors raided X’s Paris offices and summoned Musk for questioning. Meanwhile, the data privacy and media regulators in Britain, which has left the EU, have opened their own investigations into X.
The platform is already facing a separate EU investigation from Brussels over whether it has been complying with the bloc’s digital rulebook for protecting social media users that requires platforms to curb the spread of illegal content such as child sexual abuse material.
