Meta fined 800 million euros by the EU for antitrust violations in classified ads practices

Meta has been hit with a nearly 800 million euros fine by the European Commission for antitrust violations related to its handling of Facebook Marketplace.

According to the EU executive, the tech giant improperly tied its classified ads service to its popular social network, Facebook, thereby disadvantaging rival ad platforms. The Commission has demanded Meta put an end to these anti-competitive practices.

The European Union’s Competition Commissioner, Margrethe Vestager, stated that Meta’s actions were designed to give Facebook Marketplace an unfair edge that other online classified ad services simply couldn’t compete with.

The 798 million euro penalty marks Meta’s first major antitrust fine, following a previous 110 million euro fine in 2017 for providing misleading information during the EU’s investigation into its WhatsApp acquisition. The Commission also reinforced Meta’s dominant influence in personal social networks across the EU and its stronghold over online display ads on social media.

Meta has already announced its intent to challenge the hefty fine. In a blog post, the company expressed disappointment, arguing that Facebook Marketplace was a free and innovative service that met consumer demand.

The company claimed that the Commission’s regulatory approach conflicted with calls from European political leaders to boost competitiveness and innovation. Nevertheless, Meta pledged to cooperate and work towards a solution that satisfies EU regulators.

The investigation, which began in June 2021, was spurred by complaints from Meta’s competitors. They accused Meta of unfairly integrating Facebook Marketplace with its social network and using confidential advertising data to boost Marketplace’s performance.

While the European Commission has now penalised Meta, the UK’s Competition and Markets Authority (CMA) closed its own similar investigation last year. Meta had agreed to modify its practices in the UK to address concerns about the use of advertisers’ data.

The fine comes at a sensitive time for Meta, which has faced mounting pressure from both antitrust and data protection authorities in Europe. The company recently adjusted its controversial pay-or-consent model for Facebook and Instagram in response to regulatory scrutiny. In July, the Commission warned that Meta’s subscription plans might not comply with the Digital Markets Act (DMA) by potentially limiting user choice over how their data is handled.

Adding to Meta’s regulatory woes, German authorities found back in 2017 that the company’s data collection practices were abusive, specifically targeting how Meta tracked users outside its platform. Meta was ordered to stop such tracking. Now, Meta is also disputing the Commission’s classification of Facebook Marketplace as a core platform service under the DMA, a label that could further restrict its data processing capabilities.

Overall, this €800 million fine underscores the EU’s ongoing efforts to clamp down on the power of Big Tech and ensure fair competition across the digital market.