Facebook's Marketplace faces antitrust probes in EU, UK

Competition watchdogs in the European Union (EU) and the United Kingdom (UK) said on Friday that they had started separate investigations into whether Facebook's Marketplace service was in breach of competition rules, reported Xinhua.

The probes will determine whether the world's largest social network, with more than three billion monthly active users, was using customer data to unfairly compete with advertisers.

The European Commission said in a statement that it was assessing whether Facebook violated EU competition rules by using advertising data gathered in particular from advertisers in order to compete with them in markets where Facebook is active, such as classified ads.

Margrethe Vestager, the Commission's executive vice president in charge of competition policy, said that almost seven million firms advertized on Facebook, helping it collect "vast troves of data" on the activities of users of its social network and beyond, and enabling it to target specific customer groups.

Facebook offers an online classified ads service called Facebook Marketplace, which is a platform for users where they can buy and sell goods from each other.

As part of its in-depth investigation, the European Commission will examine in detail whether Facebook's position in social networks and online advertising allows it to harm competition in neighboring markets, where Facebook is also active thanks to its social network, and in particular in online classified ads.

Following a preliminary investigation, the European Commission has concerns that Facebook may distort competition for online classified ads services. In particular, Facebook might make use of the data obtained from competing providers in the context of their advertising on Facebook's social network, to help Facebook Marketplace outcompete them, according to a European Commission statement.

If proven, the practices may breach EU competition rules on anti-competitive agreements between companies and/or on the abuse of a dominant position.

The European Commission said it will seek to work closely with the UK's Competition and Markets Authority (CMA) as the independent investigations develop.