Facebook savages UK Giphy split calls - Mobile World Live

Facebook savages UK Giphy split calls

09 SEP 2021

Facebook ripped into the provisional findings of a UK Competition and Markets Authority (CMA) probe of its completed acquisition of graphics creation tool company Giphy, while questioning the regulator’s power to force a sale of the business.

A document submitted to the CMA by Facebook’s legal team in response to the authority’s draft findings outlined its belief no remedies were required as the authority had “failed to show a substantial lessening of competition”.

The lengthy response attempted to dismantle the CMA’s arguments, but also questioned whether the regulator was in a position to impose sanctions, including a floated potential divestment of Giphy.

Facebook argued Giphy had “no existing commercial interest in conducting its activities in the UK” and was a “US company with commercial activities strictly limited” to the nation, putting it outside of the CMA’s remit.

“The inability of the CMA to issue any order against Giphy raises serious questions as to the enforceability of any divestment order and whether any such order could be effective. These are questions which the CMA must carefully consider, and address, before taking the extreme intrusive step of ordering the sale of a company which does not carry on business in the UK.”

During its investigation into the acquisition, which completed in May 2020, the CMA raised concerns on Facebook’s power to limit access to Giphy tools or impose terms on rivals. It also noted a potential issues related to the digital display advertising market.

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Chris Donkin

Chris joined the Mobile World Live team in November 2016 having previously worked at a number of UK media outlets including Trinity Mirror, The Press Association and UK telecoms publication Mobile News. After spending 10 years in journalism, he moved...

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