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Shares of eBay (EBAY, Financial) surged 10% and hit a 52-week high on January 8, 2025, as news emerged that Meta (META, Financial) will integrate eBay listings into its Facebook Marketplace. This follows a 797.72 million fine by the European Commission, which accused Meta of antitrust abuse over its Facebook Marketplace.
According to Meta, the European Commission's investigation concluded that the company, which is headquartered in the US, 'unfairly' tied the Marketplace feature to the Facebook platform, thereby blocking competition from other online classified ad providers. In response, Meta is testing the inclusion of eBay's extensive listings in Facebook Marketplace, and the feature will be available initially in select markets, including Germany, France and the US.
On a regulatory front, Meta's plan to integrate Facebook Marketplace with eBay's field inventory can at least appease it since it will provide more product options and give consumers more choices. However, not only does this position Facebook Marketplace as a more competitive e-commerce market, but it has also imposed on Meta the ability to move in line with the European Commission's mandate.
In a pushback on claims that it unfairly forced users onto its platform, Meta said in a statement that Facebook Marketplace would continue to remain optional for users. The eBay partnership is also a strategic pairing for both companies as Meta tries to heal from regulatory scrutiny. For eBay, it's a big shot in the arm in an environment where you have an audience of real people Facebook has a massive user base growing your audience and driving your sales.
This article first appeared on GuruFocus.