Meta will allow eBay listings to appear on Facebook Marketplace under a new European Union (EU) antitrust compliance effort.
This is the company’s response to the largest fine ever to be imposed under the bloc’s competition rules by €798m ($822 million) and with an order forcing it to reshape its business.
Overview of EU Antitrust Ruling
Meta Strikes Deal With eBay After EU Smacks: FB Marketplace
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Meta, the parent company of Facebook, Instagram, and WhatsApp, has made a move to calm the EU’s concerns about its classified ads service, Facebook Marketplace, an initial report from Bloomberg tells us.
In the November antitrust ruling, the EU required Meta to stop linking its classified ads service to its dominant social media platform, Facebook. Moreover, the company was ordered to stop imposing unfair trading conditions on competing second-hand goods platforms.
In a bid to meet the demands of the EU’s decision, Meta has suggested a pilot where eBay listings will be integrated into Facebook Marketplace. In this pilot, running in Germany, France, and the United States, buyers will be able to browse listings directly within Marketplace, but complete transactions on eBay’s platform.
In this change, Facebook Marketplace users will have a wider variety of products available to them while still conserving the marketplace through eBay.
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Meta Disapproves of the EU’s Decision
Despite launching this initiative, Meta continues to dispute the EU’s antitrust ruling. The company made it clear in a blog post that it disagrees with the European Commission’s decision and is actively pursuing an appeal in the EU courts.
The Zuckerberg-owned firm argues that the imposed changes are unfair and that they undermine the company’s business model.
A Meta spokesperson said that the company complies with the order taking into consideration that it should be made within 90 days after the first decision in order not to take more legal consequences.
eBay Listings on Facebook Marketplace
Meta has agreed to have eBay listings posted on FB Marketplace. On the one hand, it provides access to a larger selection of used items for users on FB Marketplace.
TechCrunch reports that the inclusion of eBay will bring new buyers who might not have bought through eBay or used Facebook Marketplace for buying purposes before now. Shares for eBay have risen by 7.4% in New York trading already following the announcement.
On the other hand, this change may affect the competitive dynamics in the online marketplace industry. Meta’s dominance in the social media arena and eBay’s long-standing position as a second-hand goods marketplace may create friction with other players in the market, especially if Facebook Marketplace continues to include listings from other competitors in the future.
UK Competition Watchdog Charts a Different Course
While the CMA took a softer stance on Meta’s practices, the European Commission did not go easy on it. The CMA just accepted Meta’s concessions and did not think to move forward with a full investigation into Facebook Marketplace. This indicates that the threshold of anti-competitive behavior varies across different jurisdictions in the tech world.
Meta is trying to please the EU antitrust requirements by featuring eBay listings on Facebook Marketplace, but it is still not on good terms with the regulator. The coming test in various regions will define how successful this new collaboration is going to be in reshaping the competitive dynamics of online marketplaces.
Although Meta is adhering to the ruling, the ongoing appeal hints that the fight over Big Tech regulations is far from over.
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