Meta has been fined 798 million euros by the EU for abusing advertising dominance

Meta Platforms Inc. was fined €798 million by European Union regulators for linking its Facebook Marketplace service to the social network, the US tech giant’s first-ever fine for violations of EU law antitrust laws.

In a landmark decision, the European Commission has ordered Meta to stop linking its classifieds service to Facebook’s sprawling social media platform, and to refrain from imposing unfair trading conditions on competing second-hand goods platforms.

“Meta linked its online advertising site Facebook Marketplace to its personal social network Facebook and imposed unfair trading conditions on other online advertising providers,” EU antitrust chief Margrethe Vestager said. “It did this for the benefit of its own Facebook Marketplace service.”

This move adds to a wave of bad news for Meta. A US judge ruled that the Federal Trade Commission’s antitrust case against the company can proceed on Wednesday as Donald Trump is re-elected US president. His win helped social networking app Bluesky, which competes with Meta’s Threads, to the top of Apple Inc.’s U.S. App Store.

Just eight months ago, Trump called Facebook an “enemy of the people” and suggested that CEO Mark Zuckerberg should be jailed.

The EU fine will likely be one of the last acts for Vestager, who will leave her post before the end of the year. Over the past decade, she has been one of Silicon Valley’s fiercest critics, levying billions of euros in antitrust fines, including more than $8 billion in fines against Google.

The decision follows an investigation into how Meta uses Facebook’s billions of users to eliminate rivals. EU watchdogs said Menlo Park, California-based Meta also used data from rival platforms advertising on Facebook to improve its Marketplace service.

Meta vowed to appeal the decision to the bloc’s courts, a process that could take several years. It said the penalty “ignores the reality of the thriving European market” and “protects large established companies.”

Meta shares fell as much as one percent after trading opened in New York. The company was previously fined €110 million by the EU merger regulator for providing misleading information about its acquisition of messaging service WhatsApp in 2017.

Amazon.com Inc. dodged EU fines in a similar case in 2022, targeting the way the U.S. The e-commerce company is said to have plundered rivals’ sales data to unfairly favor its own products. Regulators accepted a number of Amazon’s proposals, including a pledge to stop using non-public data about independent sellers on its marketplace for its competitive retail business.

Facebook’s Marketplace has also been targeted by other regulators. It settled an investigation with Britain’s Competition and Markets Authority after agreeing to a series of concessions.

Meta reported revenues of $40.6 billion (approximately Rs.3,42,777 crore) in the quarter ended September 30, up 19 percent from a year earlier. In recent years, Meta has worked to balance massive spending on technologies like artificial intelligence and virtual reality, while still trying to ensure its core digital advertising business continues to grow.

Although the EU can impose fines of 10 percent of global turnover, the penalties are usually much smaller and take into account the seriousness of the allegations and the submarkets involved.

This has led to frustration among supervisors and a call for stricter measures, including more structural solutions. Like the US, the EU faces a possible breakup of Google from Alphabet Inc. considered to allay concerns about its dominance in adtech.

The new Digital Markets Act strengthens traditional antitrust law by imposing strict guardrails on Silicon Valley companies.

The European Commission has launched an investigation into Google and Meta to check their compliance with the DMA, while Apple Inc. will soon receive the bloc’s first fine for not adhering to the rules. This week, Meta unveiled changes to the way it targets users with ads on Facebook and Instagram, to offset an escalation in scrutiny.