EU fines Meta €798 million over Facebook Marketplace

The company plans to appeal

The EU has slapped Meta Platforms, Facebook and Instagram’s parent company, with a €798 million fine for abusing its dominant market position.

The EU Commission ruled Meta's integration of its online classified ads service, Facebook Marketplace, within its social network created unfair conditions for rival classified ad services.

The Commission's investigation into Facebook Marketplace dates back to 2019, following complaints from competitors who alleged that Meta leveraged its user base unfairly to promote Marketplace.

Formal antitrust proceedings were launched in 2021, culminating in a 'Statement of Objections' issued to Meta in December 2022.

The Commission found that Meta tied Marketplace to Facebook, effectively bundling the classified ads service with its primary social network. This arrangement allowed Marketplace to reach Facebook's massive user base of 1.2 billion monthly active users – a competitive edge rivals could not easily replicate.

The EU also accused Meta of imposing "unfair trading conditions" on other online classified ads services.

According to the Commission, Meta used data from competing platforms that advertised on Facebook and Instagram to benefit Marketplace, allegedly depriving rivals of a level playing field.

The Commission has now ordered Meta to cease these practices and refrain from similar behaviour in the future.

Margrethe Vestager, the EU's outgoing executive VP for competition policy, accused Meta of using its position to give Marketplace a distribution advantage over competitors.

"It did so to benefit its own service Facebook Marketplace, thereby giving it advantages that other online classified ads service providers could not match. This is illegal under EU antitrust rules," she said, adding that the company "must now stop this behaviour."

Meta has denied the allegations, arguing that the Commission's findings were unfounded and no evidence of harm to competitors or consumers was presented. It says Facebook Marketplace is merely an option for users, rather than an imposed feature. Additionally, the company says the European marketplace for classified ads remains competitive and diverse.

Meta has agreed to comply with the order to cease the offending conduct, but indicated plans to appeal the fine.

An addition to Meta’s mountain of fines

This isn't the first time Meta has faced regulatory scrutiny.

EU regulators have fined the company billions of euros in recent years over data privacy concerns and anti-competitive behaviour.

In May 2023, the company was fined a record €1.2 billion by Ireland's Data Protection Commission over its transfer of EU user data to the US.

Earlier that year, the company was fined €405 million for failing to have a valid legal basis to process user data for ad targeting.

WhatsApp, a Meta-owned messaging app, was fined €5.5 million last year for forcing users to share their personal data. In addition to the penalties, WhatsApp was ordered to bring its data processing operations into conformity within next six months.

Meta is also under scrutiny for potential violations of the EU's Digital Markets Act (DMA), and separate investigations are underway regarding Facebook and Instagram's child safety protocols and election integrity measures.