EU to impose hefty fines on Meta over classified ads practices – report

Meta Platforms (NASDAQ:META) faces a hefty fine from the European Union (EU) over allegations of monopolistic practices in the classified advertising market, The Financial Times reported early Wednesday.

The EU regulators are investigating whether Meta (META) links Facebook’s free Marketplace service with its social network to undermine competition from rival platforms, the report said, citing people familiar with the matter.

The potential penalties could reach up to 10% of Meta’s (META) global annual revenue, which was ~$135B in 2023.

The European Commission and Meta (META) did not comment on the case to FT request. However, Meta (META) pointed out, “The claims made by the European Commission lack foundation. We continue to work with regulatory authorities to demonstrate that our product innovation is pro-consumer and pro-competitive.”

The EU had released preliminary findings in December 2022, stating that Meta (META) was using data obtained from businesses at no cost for free to sell ads to users, thus undermining competition in the online classified ads market.

The EU’s decision on this matter might be out as early as next month, marking one of the last investigations led by Margrethe Vestager, the outgoing competition chief of the EU.