Meta lays up grounds for a UK appeal on Giphy
By Ishika Dangayach on Jan 05, 2022 | 05:35 AM IST
• Meta challenged the finding of the UK govt. that the deal removed a potential competitor in display advertising
• The Competition Appeal Tribunal issued a summary of Meta's appeal on Wednesday, citing its challenge on six grounds
Facebook-owner Meta has applied to appeal a British competition watchdog ruling that it must sell Giphy on grounds that include challenging the finding that the deal removed a potential competitor in display advertising, Reuters reported.
In December 2021, the business has filed an appeal with the UK's Competition Appeal Tribunal, asking the court to suspend the regulator's ruling, claiming that the evidence does not support the conclusion that the merger has the potential to damage competition.
The Competition Appeal Tribunal issued a summary of Meta's appeal on Wednesday, explaining its challenge on six grounds.
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The US business, which controls Instagram, WhatsApp, and Facebook, said the Competition and Markets Authority (CMA) failed to evaluate its offer to ensure Giphy could continue to supply services to competitors like Snapchat and TikTok on the same conditions, Reuters stated.
CMA’s order
The CMA of the United Kingdom ordered Meta to sell Giphy, which it purchased in May 2020, after concluding that the transaction had already eliminated Giphy as a potential contender in the display advertising market.
A panel determined that by blocking or limiting other sites' access to Giphy GIFs, Facebook might expand its already strong market dominance in relation to other social media networks.
Read more: Apple and Google hold 'vice-like' grip on consumers, UK regulator warns about duopoly
It would also change the terms of access, for example, requiring TikTok, Twitter, and Snapchat to provide more user data to access Giphy GIFs, CMA said.
Tech giant probe
The UK is rewriting domestic competition law to safeguard smaller entrepreneurs from the market strength of Big Tech, and this is the first time a large digital purchase has been stopped by the British regulator.
Read more: U.S. warns against IP, trade secret risks in draft EU tech rules
The government is also investigating Microsoft's $19.7 billion acquisition of Nuance Communications, which specializes in artificial intelligence and speech-to-text technology.
Picture Credits: Bloomberg
Inputs from Reuters