The Facebook parent company Meta received a list of complaints from the European Union on Monday regarding its online classifieds operation, Facebook Marketplace.
The executive branch of the EU, the European Commission, declared that it had discovered that Meta had violated EU antitrust laws by stifling competition in the markets for online classified ads.
The Commission objected to Meta’s integration of its own social network, Facebook, with the Facebook Marketplace service, which enables users to offer products for sale.
This partnership, according to the statement, gives Facebook Marketplace a “substantial distribution advantage that competitors cannot match.”
According to Margrethe Vestager, the vice president of the Commission in charge of competition regulation, consumers “have no choice but to have access to Facebook Marketplace” as a result of the partnership between Facebook and Marketplace.
“Furthermore, we are concerned that Meta imposed unfair trading conditions, allowing it to use of data on competing online classified ad services,” Vestager said in a statement.
“If confirmed, Meta’s practices would be illegal under our competition rules.”
Tim Lamb, head of the EMEA competition at Meta, said: “The claims made by the European Commission are without foundation.”
“We will continue to work with regulatory authorities to demonstrate that our product innovation is pro-consumer and pro-competitive,” he added.
In June 2021, the Commission launched an inquiry into Meta, focusing on the “possible anticompetitive conduct of Facebook.”
A declaration of objection is a formal stage in EU competition investigations that does not influence the investigation’s outcome.
However, if the Commission still determines that there is enough evidence of a breach after a company has presented its case, it may have to change its business practices or pay a fine of up to 10% of its annual global revenue.
This might result in a fine of up to $11.8 billion for Meta, whose annual revenues in 2021 were $117.92 billion.
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