La European Commission is about to inflict one of the highest fines ever imposed to a technology company. According to sources Reuters, Meta, the parent company of Facebook and Instagram, may have to pay a huge fine of over 13 billion of dollars, equivalent to 10% of its global turnover of 2023. For Brussels, the company founded by Mark Zuckerberg would have abused its dominant position in the online advertising services market.
The EU's accusations against Meta
The European Commission, through its executive arm for competition, led by Margrethe Vestager, has accused Meta of unfair commercial practices. The company would tie its Marketplace ads service to Facebook's main platform, thus ensuring a unfair advantage to its services to the detriment of competitors. The Facebook Marketplace service, integrated directly into the social platform, offers automatic access to Facebook users, creating a competitive advantage that rivals cannot replicate. This integration allowed Marketplace to easily reach a large user base, while competitors faced significant challenges achieving the same visibility.
A record fine
The expected fine could reach 13,4 billion dollars, corresponding to 10% of global turnover of Meta in 2023. This sum would be the largest fine ever imposed by the European Commission on a large technology company. For comparison, Google received fines of 4,3 and 2,4 billion euros in 2017 and 2018 respectively for similar violations. Meta had already received a fine of 1,2 billion euros from the EU in May 2023 for violating European data protection rules.
When will the fine arrive?
The final decision of the European Commission is expected for September or October 2024, although the timing could slip until November. This verdict will come shortly before Margrethe Vestager leaves office. Vestager is known for her tough approach to big tech companies, and this fine would be her last action.
Brussels' decision will come after a year and a half after the formal accusation of December 2022. During this period, Meta had the opportunity to present his arguments and try to prove the unfoundedness of the accusations. The Commission, however, seems oriented towards confirm your location, given the seriousness of the practices found. The verdict will be a crucial moment not only for Meta, but also for the entire technology sector, which it will have to deal with increasingly stringent regulations.
Meta responded firmly to the accusations, calling them baseless. The company said it wanting to collaborate with the authorities regulators to demonstrate that their innovations are pro-consumer and pro-competition.
