Zenith CC&P Current Awareness

European Commission and Facebook’s Libra

22 August 2019

Prof. Suzanne Rab

Zenith's Suzanne Rab writes:

The European Commission is understood to be conducting a preliminary competition investigation of Facebook’s Libra, according to a report by Bloomberg.

The Libra Association is a group of 28 independent companies including Mastercard, PayPal and eBay, who oversee the cryptocurrency.

It appears that the Commission’s concerns relate to how the Libra Association will collect and share customer data, integration within Facebook applications such as WhatsApp and Messenger, and whether Facebook could use Libra to foreclose rivals from fintech and related markets.

Facebook is expected to launch Libra and subsidiary, Calibra, to create an application that will allow Libra users to make payments, next year.

The European Commission is not the only regulator to have expressed concerns about Libra. The UK Information Commission and the US Federal Trade Commission have expressed concerns about the privacy risks presented by Libra’s digital currency and platform.

The European Commission also fined Facebook €110 million in 2017 for providing misleading information during the antitrust review of the Facebook/WhatsApp merger.

The European Commission has not commented on the case which is at an early stage at most.  It is likely that should the Commission’s inquiry deepen, the parties will be given an opportunity to amend their governance rules.

Current Awareness

By the CC&P team