The European Commission has imposed a significant fine of €797.72 million ($840.24 million) on Meta Platforms, Inc. for antitrust violations related to its online classified ads service, Facebook Marketplace. The penalty, announced on Thursday, follows allegations that Meta unfairly tied Facebook Marketplace to its dominant social network, Facebook, to benefit its ads service, thus disadvantaging other classified ads providers.

This decision marks a culmination of a two-year EU investigation, which formally began in June 2021. By December 2022, the European Commission had expressed concerns that Meta’s practices hindered competition by compelling Facebook users to access Marketplace—a move classified as an illegal “tie.” The EU argues that Meta used its significant influence within the social media space to push Marketplace, thereby stifling competition from other online classified platforms.

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In response, Meta announced its intention to appeal the decision but stated it would cooperate and work swiftly to address the issues raised by the EU Commission. Meta claims that Facebook users are not compelled to use Marketplace and point out that many choose not to engage with the service. It also contends that the Commission failed to provide evidence of any actual harm to competing platforms.

Facebook Marketplace was introduced in 2016, entering the European market a year later. The EU’s ruling warns that such bundling practices could impede growth opportunities for other significant online marketplaces within the EU, despite Meta’s assertion that no competitive damage was proven.

Under EU antitrust laws, companies can face fines of up to 10% of their global turnover, emphasizing the severity of the EU’s stance on anti-competitive behaviour within the digital marketplace sector.