The UK’s Competition and Markets Authority (CMA) has fined Meta (formerly Facebook) $2 million for failing to disclose key changes in its $315 million acquisition of online database and search engine Giphy.

According to the CMA, Meta failed to notify the regulator of the resignation of three key employees and the reassignment of their roles.

In November, U.K. antitrust regulators ordered Meta to sell Giphy because the acquisition could hurt social media users and U.K. advertisers.

Facebook acquired the online GIF platform in May 2020.

Britain’s anti-competition watchdog ruled that Facebook’s acquisition of Giphy would reduce competition among social media platforms, and the deal has already made Giphy less of a potential challenger in the display advertising market.

“Facebook and Giphy’s partnership has eliminated a potential challenger in the display ad market. If not acted, it will also allow Facebook to further enhance its significant market power in social media by controlling rivals’ access to Giphy’s GIFs,” Stuart McIntosh, chairman of the Independent Investigation Panel, said.

“By requiring Facebook to sell Giphy, we are protecting millions of social media users and fostering competition and innovation in digital advertising,” he said in a statement.

Prior to the merger, Giphy had launched an innovative advertising service that was considering expanding beyond the US, including the UK.

Giphy’s services enable companies like Dunkin’ Donuts and PepsiCo to promote their brands through visual images and GIFs.

The CMA found that Giphy’s ad service has the potential to compete with Facebook’s own display ad service.

Complete News Source : Business Standard