European Commission identifies legal breach in Meta's marketplace
If the charges are confirmed, the EU may fine the company up to 10% of its annual global turnover.
The European Commission said in a statement on Monday that it informed Meta, which was banned in Russia for its incitement of violence against Russians on its platforms, that the company breached EU antitrust rules by bending competition for its online classified ads.
"If the Commission concludes, after the company has exercised its rights of defence, that there is sufficient evidence of an infringement, it can adopt a decision prohibiting the conduct and imposing a fine of up to 10% of the company's annual worldwide turnover," the statement said.
The statement added that Meta "abused its dominant positions in the following two ways."
First, Meta links Facebook Marketplace with its dominant personal social network Facebook, which means that Facebook users automatically get access to the Facebook Marketplace, giving "Facebook Marketplace a substantial distribution advantage that competitors cannot match."
Second, Meta "unilaterally imposes unfair trading conditions on competing online classified ads services which advertise on Facebook or Instagram," which imposes a burden on competitors to the benefit of the Facebook marketplace.
"If the Commission concludes, after the company has exercised its rights of defence, that there is sufficient evidence of an infringement, it can adopt a decision prohibiting the conduct and imposing a fine of up to 10% of the company's annual worldwide turnover," the statement read.
Recently, the EU has been expressing concern over the US' Inflation Reduction Act over its state-and-subsidy-backed technology domination, closed markets, different intellectual protection rules, and innovation and competitiveness policies in the sector especially those implemented by China, as well as other third countries.
On December 17, China's Commerce Ministry said thirty-two member-states of the World Trade Organization (WTO) sent the US over 2000 inquiries over the week regarding its discriminatory trade policy.
Among the inquirers include some key allies of the US, namely Canada, Japan, South Korea, and the EU.
"Thirty-two WTO member states sent more than 2,000 written questions to the US concerning the compliance of the recently adopted Inflation Reduction Act, the CHIPS Act, and related measures, as well as the US state procurement policy and national security with WTO rules," the Ministry said in a statement.