Meta’s latest punishment for breaching the European Union’s General Data Protection Regulation (GDPR) will have far-reaching ramifications for companies both in Europe and beyond.

Primarily, the financial penalty of 1.2 billion euros (U.S. $1.3 billion) shows EU data protection authorities believe large fines—this case marking a record in the GDPR’s five-year history—can be both punitive and dissuasive.

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Neil Hodge is a freelance business journalist and photographer based in Nottingham, United Kingdom. He writes on insurance and risk management, corporate governance, internal audit, compliance, and legal...