Meta Hit with €798M Fine for Facebook Marketplace Antitrust Violations
In a landmark decision, Meta, the parent company of Facebook and Instagram, has been fined €798 million by the European Commission. The fine marks the EU’s first antitrust penalty against Meta, targeting the company’s alleged misuse of its dominant position by tying its online classified ads service, Facebook Marketplace, to Facebook and imposing unfair trading practices on other online classified ads providers.
Meta’s Dominant Tactics Under EU Scrutiny
The European Commission, led by Executive Vice-President Margrethe Vestager, found that Meta had abused its control in social networking and online advertising. Vestager explained, “Today we fine Meta €797.72 million for abusing its dominant positions in the markets for personal social network services and for online display advertising on social media platforms.” She added, “Meta tied its online classified ads service Facebook Marketplace to its personal social network Facebook… giving it advantages that other online classified ads service providers could not match. This is illegal under EU antitrust rules.”
By embedding Facebook Marketplace within the Facebook app, Meta ensured that all users were automatically exposed to Marketplace, whether they sought it out or not. This strategy effectively limited competition, as competing online ad services struggled to gain comparable visibility and reach.
Unfair Trading Conditions and Data Exploitation
Vestager highlighted Meta’s imposition of “unfair trading conditions” on other online classified ads providers, stating that Meta used data from these advertisers to benefit Facebook Marketplace alone. Competing providers advertising on both Facebook and Instagram allegedly faced restrictions, with Meta leveraging their ads-related data to boost its own classified ads service. This tactic allowed Meta to maintain its edge, allegedly undermining fair competition in the European market.
This antitrust action comes on the heels of Ireland’s Data Protection Commissioner (DPC) imposing a €91 million fine on Meta in September for storing user passwords in plain text. This penalty alone brought Meta’s total fines from Ireland’s privacy watchdog to over €2 billion.
A Milestone in EU Antitrust Enforcement Against Big Tech
Unlike previous fines by the DPC, which went to the Irish taxpayer, this €798 million antitrust fine will be directed into a European fund, underscoring the EU’s commitment to enforcing competition law across the bloc.
The European Commission’s decision sends a strong message to major tech firms about monopolistic practices in digital markets. Meta now faces additional regulatory scrutiny and the need to change its practices to comply with EU competition standards, as Vestager affirmed: “Meta must now stop this behaviour.”
With a cumulative €3.4 billion in fines imposed on tech firms in Ireland alone, the EU is demonstrating its resolve in curbing tech giants’ control, striving for a fairer digital marketplace.
