• Meta Platforms has been fined €797.72 million by the European Commission for antitrust violations related to Facebook Marketplace.
• The Commission claims Meta unfairly tied Facebook Marketplace to its social network, imposing unfair conditions on other online ad service providers.
• Meta plans to appeal the decision but will comply with the ruling in the interim and work on a solution.
• This decision is part of the EU's ongoing battle against antitrust violations in the digital space.

In a landmark decision, the European Commission has imposed a hefty fine of €797.72 million ($840.24 million) on Meta Platforms, the parent company of Facebook, for engaging in practices that unfairly benefited Facebook Marketplace. This move confirms an earlier report by Reuters and marks a significant step in the ongoing battle against antitrust violations in the digital space.

The Commission's statement elucidated that Meta was penalized for breaching EU antitrust rules by tying its online classified ads service, Facebook Marketplace, to its personal social network, Facebook. This action was deemed to impose unfair trading conditions on other online classified ads service providers.

In response to the decision, Meta has announced its intention to appeal. However, the tech giant has also committed to complying with the ruling in the interim and is working swiftly and constructively to launch a solution addressing the points raised by the Commission.

EU's Ongoing Battle Against Antitrust Violations

This decision by the European Commission is not an isolated incident. It follows accusations made two years ago against the U.S. tech giant of giving its classified ads service, Facebook Marketplace, an unfair advantage by bundling the two services together. The European Union had opened formal proceedings into possible anticompetitive conduct of Facebook in June 2021, and in December 2022, raised concerns that Meta ties its dominant social network Facebook to its online classified ad services.

Facebook Marketplace was launched in 2016 and expanded into several European countries a year later. The EU decision argues that Meta imposes Facebook Marketplace on people who use Facebook in an illegal tie. However, Meta countered this argument by stating that Facebook users can choose whether to engage with Marketplace, and many do not.

The Commission's claim that Marketplace had the potential to hinder the growth of large incumbent online marketplaces in the EU was also contested by Meta. The company stated that the Commission could not find any evidence of harm to competitors. It is worth noting that companies risk fines of as much as 10% of their global turnover for EU antitrust violations.

Meta's Response and Future Implications

The European Commission's ruling also highlighted that Meta had unilaterally imposed unfair trading conditions on other classified ads services providers who advertise on Meta's platforms. This included allowing Meta to use ad-related data generated by other advertisers for the benefit of Facebook Marketplace.

The Commission's decision orders Meta to bring the conduct to an end and refrain from repeating the infringement, in addition to the fine. It emphasized that while market dominance was in itself not illegal under EU antitrust rules, dominant companies have a special responsibility not to abuse their powerful market position by restricting competition.

Margrethe Vestager, executive vice-president of the Commission in charge of competition policy, stated: "Today we fine Meta 797.72 million euros for abusing its dominant positions in the markets for personal social network services and for online display advertising on social media platforms.

In response to the decision, Meta stated, "We will appeal this decision to ensure that consumers are well served in the EU." The company also pointed out that marketplaces like eBay, Leboncoin in France, Marktplaats in the Netherlands, Subito in Italy, Blocket in Sweden, and Finn.no in Norway are continuing to grow and dominate in the EU.

The fine will not go to the Irish taxpayer, but into a European fund. Besides the Facebook social media platform, Meta also owns Instagram and the WhatsApp messaging service. The EU has launched several investigations into non-compliance with the bloc's Digital Markets Act (DMA). However, Meta said that it would comply with the decision in the meantime and would work quickly and constructively to launch a solution that addresses the points raised.

This case is reminiscent of similar antitrust cases in the past, where tech giants have been accused of using their dominant market position to stifle competition. The decision by the European Commission sends a clear message to other tech companies about the importance of fair competition in the digital marketplace.