EU Fines Meta $842 Million for Abuse of Dominant Position
The European Commission has accused the company of abusing its dominant market position in the social media industry.
Record Fine for Meta
The European Commission, the executive arm of the European Union, is taking strict action against major tech companies. Meta, the parent company of Facebook, has been fined €797.12 million ($842 million) for violating antitrust regulations.
Abuse of Dominant Position
The Commission believes that Meta has exploited its dominant position by integrating Facebook Marketplace into Facebook and “imposing unfair commercial terms on other online classified ad services”. It has been established that all Facebook users are routinely exposed to Marketplace, even if they do not wish to be, giving Meta an unmatched distribution advantage over its competitors.
Additionally, the Commission has found that third-party classified ad services advertising on Facebook and Instagram were subjected to unfair commercial terms. “This allows Meta to use data from ads generated by other advertisers solely for the benefit of Facebook Marketplace,” regulators stated.
A Fine Based on Multiple Factors
The fine was calculated based on the duration and severity of the infringement, as well as Meta’s revenue. The Commission also ordered Meta to cease this practice and to avoid repeating such conduct or attempting anything similar.
Meta Challenges the Decision
Meta has announced its intention to appeal the decision. “This decision overlooks the realities of Europe’s thriving online classified ads services market and protects established large companies from a newcomer, Facebook Marketplace, which meets consumer demands in an innovative and convenient way,” the company stated.
Meanwhile, the company is attempting to meet European regulators on other fronts. Preliminary findings from an ongoing investigation by the Commission suggest that Meta violated the Digital Markets Act with its approach to a no-ads subscription, as it required EU users to either consent to highly targeted advertising or pay to avoid it. This week, Meta reduced the price of its monthly subscription and announced it would offer an advertising option that uses less user data, although it includes some unavoidable ads.