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Thursday, December 26, 2024

Huge punishment for Meta. “The decision ignores market realities”

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The European Commission (EC) imposed a fine on Meta of almost EUR 800 million. The reason given was unfair practices on the Facebook Marketplace trading website, including linking it with the Facebook social media platform. Meta announced an appeal against the decision.

The EC accused the technology giant of benefiting from its dominant position on the market, among others. by linking the online classifieds and sales website Facebook Marketplace with the Facebook social media platform. Thanks to this, all website users have automatic access to the sales platform, regardless of whether they want it or not. According to the EC, Meta thus gained an unfair distribution advantage over its competitors.

Punishment for Meta

Meta was also accused of imposing unfair commercial conditions on sellers and advertisers using its websites, including using data obtained thanks to advertisers only to its own advantage.

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The Commission ordered Meta to put an end to the infringements and fined the company EUR 797.72 million for violating EU antitrust rules.

Meta and Facebook Marketplace

Meta said it would appeal the decision, but in the meantime it would comply with it and work quickly and constructively to implement a solution that addresses the issues raised.

“We built the Marketplace in response to consumer demand – this decision ignores market realities and will only serve to protect incumbent markets from competition. The European Commission's decision provides no evidence of competitive harm to rivals or any harm to consumers,” Meta said in a statement.

The fine will probably be one of the last actions of the head of the EU antitrust office, Margrethe Vestager, who is expected to leave her position before the end of the year. She has been one of the toughest critics of Silicon Valley companies over the past decade, doling out billions of euros in antitrust fines, including more than €8 billion in fines against Google.

European Union opened a formal investigation into Facebook's possible anticompetitive conduct in June 2021, and in December 2022 raised concerns that Meta was tying its dominant social network Facebook to its online classifieds services.

Facebook launched Marketplace in 2016 and expanded its operations to several European countries a year later.

The EU's decision shows that Meta is unfairly forcing Facebook Marketplace on people who use Facebook, while Meta says this argument ignores the fact that Facebook users can choose whether to use Marketplace, but many do not.

European Commission may impose fines of up to 10% on companies. global turnover for violations of EU antitrust rules.

Main photo source: Derick P. Hudson / Shutterstock.com



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