Meta facing massive fines as European Union cracks down technology giants
The European Union has accused Meta, the American multinational technology conglomerate, of breaking antitrust rules opening the way for the company to face potential fines of billions of Euros.
If found guilty, the Facebook owner would face a fine of up to 10 per cent of its annual global revenue which works out at a staggering Euros 11.1 billion ($11.8 billion) according to Meta’s latest financial results.
The news about Meta comes as Amazon.com Inc. settled European Union antitrust investigations over how the U.S. ecommerce giant uses rivals’ sales data and whether it unfairly favours its own products. The European Commission, the Executive of the EU, accepted proposals from Amazon, including a vow to stop using non-public data on independent sellers on its marketplace for its competing retail business.
The Commission’s stance on Meta shows it remains committed to challenging major corporations operating in its sphere of influence. The Commission said it took issue with Meta tying its online classified ad business, Facebook Marketplace, to Facebook which means users have access to Marketplace “whether they want it or not”.
A Statement of Objections is the first step the Commission takes when it begins an investigation into what it believes are a violation of E.U. antitrust rules which are aimed at encouraging competition by limiting the market power of any particular firm.
“The Commission takes issue with Meta tying its online classified ads service, Facebook Marketplace, to its personal social network, Facebook. The Commission is also concerned that Meta is imposing unfair trading conditions on Facebook Marketplace’s competitors for its own benefit,” the commission said in a statement.
Meta has disputed the Commission's allegations that Facebook Marketplace detracts from competitors, the Associated Press reported. The Commission also said Meta imposes unfair trading conditions on rival ads on Instagram or Facebook by using the data from the ads to benefit Marketplace. Meta can plead its case orally at hearing or in writing.
"The claims made by the European Commission are without foundation," said European Facebook competition head Tim Lamb. "We will continue to work with regulatory authorities to demonstrate that our product innovation is pro-consumer and pro-competitive."
The EU and Britain both said last year their competition watchdogs had opened twin investigations into the company’s classified business. Irish data regulators imposed a Euros 259 million ($275 million) fine last month, bringing the total amount of fines against the tech giant to more than Euros 849 million ($900 million) since last year.
Earlier this year, the EU fined Google Euros 4.125 billion ($4.370 billion) for breaking antitrust laws relating to its Android mobile operating system.
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