By formally determining the Meta’s “primary significance for competition between markets”, the German antitrust regulator has placed the technology conglomerate under an extensive set of special abuse control introduced in early 2021. In other words, the new provision allows the Bundeskartellamt a faster and more effective intervention against the practices of large digital companies.
Under Section 19a of the German Competition Law (GWB), the Federal Cartel Office can ban tech giants from engaging in what it considers anti-competitive practices.
Image: Eckhard Henkel / Wikimedia Commons / CC BY-SA 3.0 DE
“The digital ecosystem created by Meta has a very large user base and makes the company the main protagonist in social media. Our investigations have shown that Meta is of paramount importance in all markets, also within the meaning of competition law. After a lawsuit that was contested for some time, we now formally prove the company’s relevant position. Based on this, we are able to intervene against potential competition violations more efficiently than with the set of tools available to date. Meta waived the right to appeal our decision,” said Andreas Mundt, president of the Bundeskartellamt.
Image: Reproduction/Bundeskartellamt
Used by 3.5 billion people worldwide, Meta’s services are also popular in Germany. Due to the extensive user database available to the company, social media advertising is an almost exclusive source of Meta’s revenue. Over the past year, the conglomerate’s average profit has increased to nearly $40 billion year-over-year.
Goal must fulfill decision
With the formal determination of the meaning of the Target for competition between markets, the Federal Cartel Office now lays the groundwork for a faster conclusion of the ongoing proceedings against the holding company.
According to legal provisions, the regulators’ decision is valid for five years after it enters into force. Within this period, the Meta is subject to special abuse control by the German legislature under Section 19a of the GWB.
The pending decision before the courts began in 2019, when the Federal Cartel Office ordered the company to restrict data collection, on the grounds that the world’s largest social network had abused its market dominance to collect information from its users. without their consent. At the time, Facebook appealed the decision.
Later, in December 2020, the Bundeskartellamt opened an abuse lawsuit related to the link between Oculus virtual reality products (Meta Quest) and the social network Facebook.
Image: Facebook/Reproduction
On Wednesday, a Meta spokesperson said the company would comply with the German regulators’ decision on the rating. “While we do not share the reasoning that led to the Federal Cartel Office’s decision, we will continue to focus on providing our users in Germany with the best possible experience in compliance with all laws and regulations,” he told Reuters.
