A PYMNTS Company

Austria’s Watchdog Challenges Clearance Of Facebook’s Giphy Deal

By  |  March 6, 2022
Austria

Austria’s Federal Competition Authority (BWB) has spoken against the purchase operation of Internet image service Giphy by Facebook or its parent company Meta, a move approved by the country’s cartel court. The BWB has appealed to the Austrian Supreme Court (OGH) in hopes of overturning the decision.

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    yesSubscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    At the beginning of February, the deal was approved with conditions by the cartel court, to which the BWB referred the case in August because of its competition concerns, reported DigLogs.

    We’d love to be your preferred source for news.

    Please add us to your preferred sources list so our news, data and interviews show up in your feed. Thanks!

    Add as Preferred Source

    Following the BWB’s appeal, which was backed by the Federal Cartel Prosecutor, the approval of the deal subject to conditions or remedies is not yet legally binding, as the BWB explained on Friday. The cartel court held that any anti-competitive effects were being balanced by the pre-conditions imposed, and it could see no horizontal competition concerns from this merger.

    Related: Antitrust Court In Austria OKs Facebook-Giphy Deal

    As early as August 2021 the BWB feared that Meta would restrict non-discriminatory access to Giphy for other online services, that it would receive competitively sensitive information about competing online services through Giphy’s library interface, which is integrated into numerous apps, and would “nip in the bud” potential competition with Giphy for advertisers”.

    The cartel court largely accepted BWB’s arguments and found that the merger would strengthen Meta’s market position in an anti-competitive manner. According to the cartel court, Meta has a dominant position in the market for social media, owning both Facebook and direct-messaging service WhatsApp. Meta also benefits from relatively high market entry barriers. According to the BWB, the Cartel Court confirmed Meta’s market dominance in the Austrian online advertising market.

    The court also accepted the argument that the merger would put Meta’s competitors at risk of losing their access to Giphy’s services or of receiving them in poor quality.

    Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.