London: Meta (formerly Facebook) will be subjected to a special anti-competition abuse control regime in Germany, its regulator said on Wednesday, as the rebranded social network is considered to be of “paramount significance for competition across markets”.
The new regime enables the Federal Cartel Office (FCO) to intervene earlier and more effectively against the practices of large digital companies.
If the FCO formally determines that an undertaking is of paramount significance for competition across markets, it can prohibit it from engaging in anti-competitive practices.
“The digital ecosystem created by Meta has a very large user base and makes the company the key player in social media. Our investigations have shown that Meta is of paramount significance across markets, also within the meaning of competition law,” said Andreas Mundt, President of the FCO (Bundeskartellamt).
“Based on this, we are able to intervene against potential competition infringements more efficiently than with the toolkit available to us so far. Meta has waived the right to appeal our decision,” Mundt said in a statement.
The new Meta designation stands for five years. Within this period, Meta is subject to special abuse control by the FCO in Germany as set out in “Section 19a(2) GWB”.
Meta told TechCrunch that “while we disagree with the reasoning leading to the FCO’s decision, our focus remains on delivering the best possible experience to our users in Germany in compliance with all laws and regulations”.
Meta’s services are being used by more than 3.5 billion people worldwide.
Its services are also widely used in Germany. Owing to its large user base and the user data available to the company, Meta is also the leading provider of social media advertising, which is the company’s almost exclusive source of revenue.
In 2021, Meta’s net income increased again in year-on-year comparison by more than a third to almost $40 billion.
The new rules regarding abuse control have enabled the German regulator to intervene earlier and more effectively against the practices of large digital corporations.
The authority has since initiated new proceedings against Google, Amazon, Meta, and Apple.