The European Commission has fined Meta €797.72 million for breaching EU antitrust rules by tying its online classifieds service Facebook Marketplace to its personal social network Facebook and imposing unfair trading conditions on other online classifieds providers.
Meta is an American multinational technology company. Its flagship product is the personal social network Facebook. It also offers an online classifieds service called "Facebook Marketplace" where users can buy and sell goods.
The Commission's investigation found that Meta has a dominant position at personal social networking market, which includes at least the entire European Economic Area (EEA), as well as to national markets for online display advertising on social networks.
In particular, the Commission found that Meta had abused its dominant position in breach of Article 102 of the Treaty on the Functioning of the European Union ("TFEU") by:
- She linked to its online classifieds service Facebook Marketplace with your personal social network Facebook. This means that all Facebook users automatically have access and are exposed to the Facebook Marketplace on a regular basis, whether they want to or not. The Commission found that competitors to Facebook Marketplace may be foreclosed from the market because the tie-in gives Facebook Marketplace a significant distribution advantage that competitors cannot match.
- Unilateral imposes unfair trading conditions other online classifieds service providers who advertise on Meta's platforms, especially its very popular social networks Facebook and Instagram. This allows Meta to use ad-related data generated by other advertisers exclusively for the benefit of the Facebook Marketplace.
Commission ordered Meta to effectively end this conduct and in order to refrained from repeating the offence or not to adopt practices in the future with equivalent object or effect.
The fine of €797.72 million was determined on the basis of the Commission's 2006 Guidelines on fines (see press release a MEMO).
In setting the amount of the fine, the Commission took into account the duration and gravity of the infringement, as well as the turnover of Facebook Marketplace to which the infringement relates, which therefore determines the basic amount of the fine. In addition, the Commission took into account Meta's total turnover in order to ensure a sufficient deterrent effect for a company with such significant resources as Meta.
"Today we have imposed a fine of €797.72 million on Meta for abuse of dominant position in the markets for personal social networking services and online display advertising on social media platforms. Meta tied its Facebook Marketplace online classifieds service to its personal social network Facebook and imposed unfair commercial terms on other online classifieds service providers. It did so to the benefit of its own Facebook Marketplace service, giving it advantages that other online classifieds service providers could not match. This is illegal under EU antitrust rules. Meta must now stop this behaviour," said the Commission's executive vice-president responsible for competition policy Margrethe Vestager.
V June 2021 the Commission has opened a formal investigation into possible anti-competitive behaviour by Facebook. V December 2022 The Commission sent a Statement of Objections to Meta, to which Meta replied in June 2023.
Article 102 SFEU and Article 54 of the EEA Agreement prohibit abuse of a dominant position.
As such, market dominance is not illegal under EU antitrust rules. However, dominant companies have a special responsibility not to abuse their strong market position by restricting competition, either in the market in which they are dominant or in separate markets.
Fines imposed on companies that break EU antitrust rules are paid into the EU general budget. This revenue is not earmarked for specific expenditure, but Member States' contributions to the EU budget for the following year are reduced accordingly. The fines therefore help finance the EU and reduce the burden on taxpayers.
Further information on this case will be available under the case number AT.40684 In public register of cases on the Commission's website dedicated to competitiononce confidentiality issues have been resolved.
EC/ gnews - RoZ
ILLUSTRATIVE PHOTO - pixabay
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