German regulator to tackle Meta with new anti-trust rules

The new provision enables the German Federal Cartel Office to intervene earlier and more effectively against the practices of large digital companies.
Written by Julian Bingley, Contributor

Meta has been classified by the German Federal Cartel Office (FCO) as a company of "paramount significance for competition", a move that gives the regulator more leeway to curb the digital giant's market power.

Under a new provision of the German Competition Act, introduced by lawmakers in early 2021, the FCO can ban what it deems to be anti-competitive activities by large companies.

President of the FCO Andreas Mundt stated that Meta's large user base and expansive ad-supported digital ecosystem -- which also includes WhatsApp and Instagram -- clearly illustrates that the company is a key social media player.

"Following a proceeding which was contested for some time, we have now formally proven the company's relevant position. Based on this, we are able to intervene against potential competition infringements more efficiently than with the toolkit available to us so far," he said.

The FCO added that the new classification would form the basis for a more rapid conclusion of ongoing anti-trust proceedings against Meta. These include Meta's active appeal of a groundbreaking decision from 2019 in which the FCO ruled that Meta, then called Facebook, must obtain consent before collecting data on users outside of its main social networking service. 

Furthermore, the FCO had initiated abuse proceedings against Meta in 2020 related to links between Meta Quest, formerly Oculus, virtual reality products and Facebook.

Meta has waived the right to appeal the FCO's decision and stated that it would comply with the cartel offices' decision. 

"Even if we do not share the reasoning that has led to the Federal Cartel Office's decision, we will continue to concentrate on providing our users in Germany with the best possible experience in keeping with all the laws and regulations," a Meta spokesperson told Reuters.

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