The European Commission has cleared the Meta (formerly Facebook) acquisition of customer relationship management (CRM) system provider Kustomer at phase 2 with commitments.
This is the first phase 2 case cleared by the European Commission in 2022.
After its phase 2 investigation, the Commission had remaining concerns that the merged firm might have the ability and incentive to engage in foreclosure of CRM providers by denying them access to Meta’s messaging channels such as WhatsApp and Facebook Messenger. It therefore sought and obtained access commitments from Meta removing any prospect of discrimination against competitors. The Commission rejected two other theories of harm which it had considered in detail: that there might be an increase in Meta’s market power in online display advertising; and that there might be harm from Meta’s increased access to data.
A Frontier team advised Facebook throughout the EC’s consideration of the merger, during the CMA’s earlier unconditional clearance of the merger in the UK, and continues to advise on the German FCO’s review of the deal.
This case has been nominated for the Merger Control Matter of the Year – Europe, at the Global Competition Review Awards 2022. Read more about this here.
Frontier Economics regularly advises clients on competition matters.
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