Report: Meta Facing EU Fine for Linking Facebook and Marketplace

Meta Platforms is reportedly facing its first antitrust fine in the European Union (EU).

That fine could be handed down in a few weeks in response to the company connecting its  classified ad service Marketplace with the Facebook social network, Reuters reported Thursday (July 25), citing sources with direct knowledge of the matter.

The fine would come from the European Commission (EC), which in late 2022 accused Meta of giving Marketplace an unfair edge by tying it to Facebook. The EC also said Meta took advantage of its dominance by imposing unfair trading conditions on competing online classified ads services that advertise on Facebook or Instagram.

Last year, Meta said it would challenge the EU’s antitrust allegations, calling them baseless and affirming its commitment to working with regulatory bodies.

Reuters notes that Meta could face a fine of up to $13.4 billion — or 10% of its 2023 global revenue — though EU sanctions are typically much lower than that cap. Sources told the news outlet that the EC will likely issue its decision in September or October before EU competition chief Margrethe Vestager leaves office in November.

Meanwhile, Meta this week raised concerns about the EU’s approach to regulating artificial intelligence (AI). Rob Sherman, the company’s deputy privacy officer and vice president of policy, warned in a Financial Times interview that regulatory efforts could potentially isolate Europe from access to cutting-edge AI services.

Sherman confirmed that Meta had gotten a request from the EU’s privacy watchdog to halt AI model training using European data voluntarily. The company is complying with this request, but is concerned about the growing “gap in technologies available in Europe versus the rest of the world,” he said.

“This situation highlights the delicate balance between fostering innovation and ensuring responsible AI development. As tech companies race to commercialize AI products, they face constraints from the EU’s digital rules, including data protection regulations like GDPR,” PYMNTS wrote earlier this week, noting that Meta had already held off debuting its AI assistant in Europe due to regulatory concerns.

“As the AI landscape evolves, the tech industry and EU regulators must find common ground to ensure Europe remains competitive in the global AI market while safeguarding user privacy and safety,” that report said.