The European Union’s new digital-competition law has been making waves in the tech industry, and now Facebook owner Meta Platforms Inc. has become the second company to be charged under this new regulation.
The European Commission, the EU’s antitrust authority, has accused Meta Platforms Inc. of abusing its dominant market position in the digital advertising industry. This follows an investigation that began in 2020, which looked into whether Meta had violated EU competition rules by using data from advertisers to unfairly compete with them in the online classified ads market.
This development marks a significant escalation in the EU’s efforts to rein in the power of big tech companies. The new digital-competition law, which came into force in December 2020, gives regulators more tools to tackle anti-competitive behavior in the digital sector.
In a statement, Margrethe Vestager, the EU’s Executive Vice President for a Europe fit for the Digital Age, said, “We have found that Meta Platforms Inc. distorted competition in the online classified ads market by using data from competing online classified ads services in order to compete with them in markets where Meta was a direct competitor.”
The charges against Meta Platforms Inc. come just months after Amazon became the first company to be charged under the new digital-competition law. The EU accused Amazon of using data from third-party sellers on its platform to gain an unfair advantage over them.
Meta Platforms Inc. has denied any wrongdoing and said it will “defend itself vigorously” against the charges. The company has argued that it operates in a competitive environment and that its actions have benefited consumers by driving innovation and lower prices.
The outcome of this case could have far-reaching implications for the tech industry, as regulators around the world are increasingly scrutinizing the market power of big tech companies. The EU’s new digital-competition law is just one example of the growing regulatory pressure facing tech giants, and it is likely that more companies will face similar charges in the future.
As the investigation into Meta Platforms Inc. unfolds, it will be interesting to see how the company responds and whether it will be able to successfully defend itself against the EU’s allegations. Regardless of the outcome, this case underscores the growing importance of competition law in the digital age and the need for regulators to keep a close eye on the activities of big tech companies.