EU fines Meta €797M over Facebook Marketplace anti-competitive advertisement model News
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EU fines Meta €797M over Facebook Marketplace anti-competitive advertisement model

The European Commission fined Meta, the parent company of Facebook, $797.72 million euro on Wednesday for abusing its dominant position and breaching EU antitrust rules. The EU opened these proceedings against Meta in 2021 for the anti-competitive advertising model adopted in the operation of Facebook Marketplace.

Meta, formerly known as Facebook Inc., owns several social media platforms including Facebook, Instagram, and WhatsApp. The European Commission concluded that Meta is “dominant in the market for personal social networks” and “in the national markets for online display advertising on social media.” The Commission investigation focused on Facebook’s classified advertising service, Facebook Marketplace.

The Commission found that Meta was acting contrary to Article 102 of the Treaty on the Functioning of the European Union (TFEU) by “tying” Facebook Marketplace to Facebook, and in doing so, regularly exposed Facebook users to Facebook Marketplace “whether they want it or not.” The commission found that this created a “substantial distribution advantage” which “competitors cannot match.” The commission also found that Meta was “unilaterally imposing unfair trading conditions” on other advertisement service providers using Meta’s platforms.

Holding a dominant market position is not illegal. However, abusing this position constitutes an unfair and anticompetitive practice, contrary to the TFEU and Article 50 of the Agreement on the European Economic Area.  Article 102 of the TFEU outlines the rules for companies which hold dominance in the market and the instances in which this dominance may be abused.

Margrethe Vestager, European commissioner in charge of competition policy, commented on the decision. She emphasized the illegality of Meta’s conduct under EU antitrust rules, and said “Meta must now stop this behavior.”

This latest action against Meta comes as the European Union aims to regulate Big Tech giants closely. Meta has been the subject of several EU antitrust proceedings this year. In July, the Commission found that Meta violated the Digital Markets Act over unfair advertising models.

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