EU fines Meta $A1.3b over Facebook's classified ads

The European Commission has fined Meta Platforms $A1.3 billion over abusive practices benefiting Facebook Marketplace, it said in a statement, confirming an earlier report by Reuters.

"The European Commission has fined Meta ... for breaching EU antitrust rules by tying its online classified ads service Facebook Marketplace to its personal social network Facebook and by imposing unfair trading conditions on other online classified ads service providers," the European Commission said of the €797.72 million fine.

Meta said it will appeal the decision, but in the meantime, it will comply and will work quickly and constructively to launch a solution which addresses the points raised.

European Commission
The European Commission's accused Meta of giving Facebook Marketplace an unfair advantage. (EPA PHOTO)

The move by the European Commission comes two years after it accused the US tech giant of giving its classified ads service Facebook Marketplace an unfair advantage by bundling the two services together.

The European Union opened formal proceedings into possible anticompetitive conduct of Facebook in June, 2021, and in December, 2022, raised concerns that Meta ties its dominant social network Facebook to its online classified ad services.

Facebook launched Marketplace in 2016 and expanded into several European countries a year later.

The EU decision argues that Meta imposes Facebook Marketplace on people who use Facebook in an illegal "tie" but Meta said that argument ignores the fact that Facebook users can choose whether to engage with Marketplace, and many do not.

Meta said the Commission claimed that Marketplace had the potential to hinder the growth of large incumbent online marketplaces in the EU but could not find any evidence of harm to competitors.

Companies risk fines of as much as 10 per cent of their global turnover for EU antitrust violations.