The European Union (EU) draws attention with the strict controls and penalties imposed by large technology companies against competition violations. Finally, Meta faced one of these penalties. The European Commission, the executive body of the EU, fined social media giant Meta 797 million euros for providing an advantage over its competitors in the use of the Facebook Marketplace platform. This penalty stands out as part of the EU’s effort to regulate digital markets.
The Commission stated that Meta caused unfair competition by integrating the Facebook Marketplace service into the Facebook platform. In particular, the fact that Marketplace was presented directly to Facebook users and this limited user choices strengthened the claim that Meta had dominance in the market. The EU emphasized that this means that people who are Facebook users are exposed to Marketplace even if they do not want to. This context, which is contrary to competition rules, has resulted in Meta gaining an unfair distribution advantage over its competitors in the industry.
On the other hand, it was determined that third-party advertising service providers advertising on Facebook and Instagram also faced unfair trading conditions. According to the European Commission, Meta disadvantaged other online advertising platforms by using data streams from these third-party advertisers solely to benefit its own platform. This use of data means Meta has the opportunity to influence user preferences and use user data more effectively compared to competing listing services.
The European Commission announced that when determining the fine in question due to Meta’s apparent competition violation, it took into account the duration of the violation, Meta’s revenues and the affected market structure. He also stated that Meta should put an end to such practices and avoid other strategies that would distort competition with the same or similar methods. This decision is considered as part of the EU’s goals to counter the dominance of large technology companies in the market and create a fairer digital market.
Meta announced that it would appeal this decision of the European Commission. In the statement made by the company, it was argued that Facebook Marketplace exists as an innovative and useful service in the European online advertising market, but this penalty protects large companies and prevents new initiatives. Meta claims that Marketplace responds to consumer demands with the options it offers, but this penalty harms digital competition.
There are other disagreements between Meta and the EU
Meta’s legal disputes with the EU are not limited to this. The company is also the target of another investigation for allegedly violating the Digital Markets Act (DMA). The EU states that Meta’s practice of making targeted advertising by collecting user data under the conditions it imposes on its ad-free subscription offer is against the law. Imposing a requirement for EU citizens to consent to the use of their personal data for highly targeted advertising or to pay subscription fees is incompatible with the DMA. In this regard, Meta announced that it updated its subscription fee policy and started offering users advertising options that require less data usage. However, it is stated that in this new advertising model, it will not be possible for users to switch to some advertisements.