Meta, the parent company of social media giant Facebook, has been fined NIS 25 million by the Israel Competition Authority for failing to report the acquisitions of Redkix in 2018 and Servicefriend in 2019. The regulatory body found that Meta violated rules pertaining to notifying the authorities about acquisitions, especially when holding a monopolistic market share.
The acquisitions in question took place in 2018 when Facebook acquired Redkix, a platform developed by brothers Oude and Roy Antebe for sending massive numbers of announcements. In September 2019, Facebook further expanded its portfolio by acquiring Servicefriend. While the Redkix acquisition was reported to the media by Facebook itself, the Competition Authority was not officially notified.
The Israel Competition Authority emphasized that any company holding a monopolistic market share must inform the regulator about the signing of an agreement to acquire another company. The acquiring company is then required to wait for the regulator’s decision and only proceed with the acquisition after receiving approval.
The regulatory body stated, “A company that holds a monopolistic market share must inform the Competition regulator about signing an agreement to acquire a company, wait for the regulator’s decision, and only after agree to make the acquisition.”
Following negotiations between Meta and the Israel Competition Authority, a joint decision was reached. Meta has agreed to pay NIS 25 million to the state coffers as a penalty for the oversight. Additionally, Meta has committed to reporting any future mergers of companies it undertakes, as long as it remains defined as a monopoly in the field of social networks for private users.
The regulator noted that if Meta had submitted a request in a timely manner for the two acquisitions, the Israel Competition Authority would have accepted the request without imposing any conditions.
Source: En Globes Co