Key Takeaways
- Meta has been asked to pay a fine of €798 million ($840 million) for using “abusive” practices to benefit from Facebook Marketplace.
- It started with an investigation in 2021 that led to these concerns being raised for the first time in 2022.
- The company has addressed the decision and said it would appeal against it. But in the meantime, it has decided to comply with it and develop an action plan to address issues.
Meta has been hit by another fine of €798 million ($840 million) by the EU for allegedly breaching its antitrust regulations and using “abusive” practices to benefit its Facebook Marketplace.
In its official statement, the EU Commission (EU’s executive arm) explained that Meta has been penalized for “tying its online classified ads service Facebook Marketplace to its personal social network Facebook and by imposing unfair trading conditions on other online classified ads service providers.”
The Commission also said that such practices could make it difficult for other marketplaces to find their footing in the industry. While they have to work on finding new customers from scratch, Facebook Marketplace gets to access millions of potential users at once.
This unfair advantage might end up reducing competition in the industry which in turn will reduce the choices available for users.
The final verdict comes almost two years after the EU has made this accusation against Meta.
- It started in 2021 with an investigation into Meta’s (back then still known as Facebook) anti-competitive practices.
- Then in December 2022, the EU raised concerns about Meta’s practice of bundling up the social media network Facebook and Facebook marketplace.
What Does Meta Have to Say About This?
Meta has acknowledged the decision and said that it will appeal against it. But in the meantime, it’ll try to comply with the verdict and come up with an action plan that effectively addresses the issue.
It also denied the claims that tying up Facebook Marketplace with the personal social media site is anticompetitive because customers aren’t forced to use the Marketplace. They can choose to ignore it if they want.
It also countered the claim that its practices might hamper competition in the industry by saying that the EU Commission doesn’t have any evidence to back this up.
Other Issues Between Meta and the EU
The last few months (and maybe years) have been difficult for Meta. It has constantly landed in trouble with the EU over one thing or the other.
Here’s a list of other investigates that the company is facing from the EU Commission:
- In March this year, the company was accused of running a massive data processing business, which is against the GDPR.
- In May this year, the EU launched an investigation against Meta for not taking enough steps to protect minors on Instagram and Facebook.
- In July, the company was accused of breaking competition laws by introducing its “pay or consent model” which forced users to either pay or let their data be collected.
Operating in the EU has never been easy. It’s one of the few countries that puts user safety above everything else. And recently, after the Digital Services Act (DSA) was imposed in February 2024, more and more tech companies are being penalized for their illegal practices.
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