Mark Zuckerberg’s Meta Platforms, Inc., the world’s largest social networking firm with a market cap of $1.2 trillion, will pay 25 million shekels ($6.8 million) to Israel’s State Treasury after violating rules governing acquisitions.
Meta’s Facebook arm purchased two Israeli companies, RedKix, Inc. in 2018 and Service Friend Ltd. in 2019, without obtaining the Israel Competition Authority’s consent, contrary to the Economic Competition Law, according to an ICA statement.
Redkix combines email with collaboration tools. Service Friend builds A.I. bots for messaging apps to help customer service teams.
The ICA’s investigation found that Facebook was obliged to report the transaction to the director general since Facebook is a “monopolist,” the statement said, defining monopolist as a firm whose market share in Israel exceeds 50%.
Any company with 50% or more in a relevant market needs the ICA director general’s consent before completing a transaction that constitutes a “merger of companies” under the Economic Competition Law.
However, Facebook did not obtain the director general’s approval before closing the acquisitions.
The Competition Authority’s Tribunal said, “Handling this type of defect by paying an amount to the State Treasury is a proper course. Since it is done by agreement and the amount is relatively high, it seems that it should be approved.”
