Facebook in the crosshairs of the EU Commission which has opened an investigation for violation of competition rules. In particular, the evaluation concerns the use of data relating to advertising, collected in particular by advertisers for compete with them in the markets in which it operates, such as advertising. The investigation will also investigate whether Facebook links its Facebook Marketplace service to the social network, in violation of EU antitrust regulations. In addition to being a social network, the platform also offers a classifieds service, called Facebook Marketplace, where Facebook users can buy or sell goods among themselves. When advertising their services on Facebook, companies, which also compete directly with Fb, can provide data that has commercial value. Facebook could use them against the companies that provided them. This is especially true for online classified ad providers, the platforms on which Europeans buy and sell products.
Companies operating in this sector advertise their services on the Facebook social network: at the same time, they compete with Fb’s ad service, Facebook Marketplace. The Commission fears that the Menlo Park company could distort competition for online ad services. In particular, Fb could use the data obtained from competitors, in the context of the advertising of the latter’s offers on the social network, to help Facebook Marketplace to beat them.
Facebook may, for example, receive accurate information on user preferences from competitors’ advertising activities and use this data for the benefit of Facebook Marketplace.
The Commission will also consider whether the way Facebook Marketplace is ’embedded’ in the social network constitutes a link that gives it an advantage in reaching customers and whether it hinders competing classified ad services.
If proven, the practices under investigation could violate EU antitrust rules on anti-competitive agreements between companies and abuse of dominant position.
The investigation is considered a priority by the Commission. At the same time, today the Cma, the British Antitrust, has launched its own investigation into the use that Facebook makes of the data and the Commission will try to work closely with the Cma during the investigation.
“We are constantly working to develop new and better services that can meet the evolving needs of people who use Facebook,” says a Facebook spokesperson. “Marketplace and Dating offer people more choice and both products operate in a highly competitive environment, which presents other big players. “” We will continue to cooperate fully to investigations to prove that they have no basis“concludes the spokesman.