Home » News » Detail

Facebook fine for illegal merger now final

On 22 July 2021, the Cartel Court imposed a fine, as requested by the AFCA based on a settlement agreed upon with Facebook, of EUR 9.6 million on the grounds of Facebook’s illegal merger with GIPHY.

The Austrian Federal Competition Authority’s (AFCA) remit includes investigation of whether certain planned mergers would create or increase a position of market dominance. This concerns cases where certain thresholds are exceeded (cf. § 9 of the Federal Cartel Act – KartG). Facebook acquired GIPHY in May 2020 and did not notify the AFCA of the merger despite exceeding the statutory threshold values (§ 9 para. 4 KartG). Consequently, the AFCA applied for Facebook to be fined, based on the settlement. The Cartel Court accepted AFCA’s application and imposed the requested fine of EUR 9.6 million on 22 July 2021. Facebook cooperated fully with the AFCA and did not contest the decision, which is therefore final.

On 20 July 2021, Facebook retroactively notified the AFCA of its acquisition of GIPHY. Following notification of mergers, the AFCA must decide in the course of a four-week investigation whether to clear the planned merger (Phase 1) or request an in-depth examination by the Cartel Court (Phase 2). In the course of its four-week Phase 1 investigation of the GIPHY takeover, the AFCA gathered extensive information and obtained feedback from numerous market participants. The Authority concluded that the merger raised competition concerns and therefore required an in-depth examination by the Cartel Court in Phase 2 investigations (cf. press release of 17 August 2021). The Cartel Court is now obliged to examine the request within a period of five months.