UK, EU regulators probe Facebook’s use of advertising data

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The UK's Competition and Markets Authority (CMA) is investigating whether Facebook is abusing a dominant position in the social media or digital advertising markets through its advertisement data.

UK, EU regulators probe Facebook’s use of advertising data

In a rarely coordinated probe of a US tech giant, the United Kingdom, and the European Union regulators on Friday launched formal investigations to assess if Facebook’s use of advertising data was unfair.

The UK's Competition and Markets Authority (CMA) is investigating whether Facebook is abusing a dominant position in the social media or digital advertising markets through its advertisement data.

Similarly, the EU’s executive arm European Commission said it would initiate a formal antitrust investigation to assess whether Facebook breached its rules “by using advertising data” gathered especially from advertisers “to compete with them in markets” where it is active like classified ads.

The CMA said it would look into whether Facebook has unfairly used the data gained from its advertising and single sign-on option, Facebook Login, to benefit its buying and selling platform, Facebook Marketplace, and online dating service, Facebook Dating.

Andrea Coscelli, chief executive of the CMA, said in a statement, "We intend to thoroughly investigate Facebook’s use of data to assess whether its business practices are giving it an unfair advantage in the online dating and classified ad sectors."

"Any such advantage can make it harder for competing firms to succeed," he added.
The EU investigation will also seek to determine if the link between the Facebook social network and Facebook Marketplace is in breach of its competition rules.
Margrethe Vestager, the European Commission’s executive vice-president, said in a statement: "Facebook is used by almost 3 billion people on a monthly basis and almost 7 million firms advertise on the platform. Facebook collects vast troves of data on the activities of its users, enabling it to target specific customer groups."
"We will look in detail whether this data gives Facebook an undue competitive advantage in particular in the online classified ads sector… where it competes with the companies from which it collects data. In today’s digital economy, data should not be used in ways that distort competition," added Vestager.
Defending their practices, a Facebook spokesperson said their Marketplace and Dating offer people more choices and operate in a highly competitive environment with many large incumbents. "We are always developing new and better services to meet the evolving demand from people who use Facebook."
The spokesperson added the company would continue to cooperate fully with the investigations to demonstrate that they are without merit.
Facebook shares closed up 1.32 percent on Friday.
Facebook apart, several big tech firms are facing increasing amounts of scrutiny around the world. The European Commission has already probed into Amazon, Google and Microsoft business practices over the last few years, while the CMA has also investigated Google and Apple since January when it came into existence following Britain’s exit from the EU.

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