Facebook’s EXCLUSIVE deal with Kustomer under EU antitrust investigation
BRUSSELS, July 23 (Reuters) – Facebook’s (FB.O) acquisition of U.S. customer service startup Kustomer is expected to trigger a full-scale European antitrust investigation next month, three people familiar with the matter said on Friday.
The world’s largest social network, which announced the deal in November, is considering the deal to develop its WhatsApp instant messaging app, whose use has skyrocketed during the COVID-19 pandemic.
The European Commission will complete its preliminary review of the deal on August 2, after which it will begin a 90-day in-depth investigation, the sources said.
Facebook has until July 26 to offer concessions to avoid the investigation, but it is unlikely to do so due to the difficulty of finding the right remedies to resolve the competition concerns, the undercover people said. of anonymity.
The Commission declined to comment.
Facebook referred to its June statement that the deal is pro-competitive and will bring more innovation to businesses and consumers.
The EU competition authority took over the case, citing a rarely used power known as Article 22 which gives it some leeway, and following an Austrian request even though the agreement falls below the EU turnover threshold.
The scrutiny of small transactions by the EU watchdog coincides with regulatory concerns on both sides of the Atlantic that a spree to buy start-ups by large companies, which does not trigger a review of competition because of the low value of the deal, can be what is called a killing spree. acquisitions, which means they kill potential competitors before they’re big enough to be a threat.
Germany’s antitrust agency said on Friday it was looking to see whether Facebook should seek approval as well, what effect the deal would have in Germany, and whether Kustomer was significantly active there.
Reporting by Foo Yun Chee, editing by Louise Heavens and Barbara Lewis
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