Meta back in the crosshairsEuropean Union: il Facebook Marketplace would violate competition laws in online advertising markets. The company therefore risks sanctions for having violated article 102 of the Treaty on the functioning of theEuropean Union (TFEU), the one that prohibits the abuse of a dominant position. The company disputes the accusation, “without foundation”.
The Facebook Marketplace under accusation by the EU, Meta at risk of sanctions
The European Commission thinks that the fact that Facebook Marketplace is linked to the social network Facebook would cause a distortion of the online competition. This is what emerges from the Commission’s preliminary rule, which disputes the work of Meta, a company that also manages Instagram and WhatsApp.
According to Brussels, “Facebook users have automatically access to Facebook Marketplace, whether they like it or not.” This would also allow the company to impose what the EU defines as unfair commercial terms on the service’s competitors, to its own advantage: “unjustified, disproportionate and unnecessary for the provision of online advertising services on Meta’s platforms”.
According to the new European regulations on competition in digital marketplaces, Meta risks a sensational fine: up to 10% of annual revenue of the company on a global basis. A figure that would exceed two billion dollars if a sanction were actually imposed.
In a statement to Reuters, the spokesman Tim Lamb he said: “The statements made by the European Commission are baseless.” The spokesman then said that “We will continue to work with regulatory authorities to demonstrate that our innovative product is in favor of consumers and in favor of competitiveness”.
The Commission had already launched the June 4, 2021 a formal proceeding for anti-competitive behavior of Facebook. This preliminary opinion suggests that the opinion that the Commission has formed is not positive. But there is still room for maneuver for Meta to avoid penalties. We will keep you posted.