The European Commission has opened an in-depth investigation into Facebook's proposed acquisition of Kustomer. The Commission said it was concerned the takeover could reduce competition in the market for CRM software and further strengthen Facebook's dominant position in the online display advertising market.
While the acquisition does not meet the turnover thresholds for an EU investigation, several EU countries made use of their right to ask the Commission to examine the takeover, due to concerns it could affect competition in their markets. These include Austria, Belgium, Bulgaria, France, Iceland, Ireland, Italy, the Netherlands, Portugal and Romania.
The Commission will look in particular at whether Facebook could use Kustomer to restrict access to its messaging apps for customer service. WhatsApp, Instagram and Messenger are increasingly important channels for businesses to come into contact with customers, and Facebook could tie access to these platforms to using Kustomer software or restrict other companies' access to the platform features.
Furthermore, the acquisition gives Facebook access to even more personal data from Kustomer's platforms, potentially reinforcing Facebook's dominance on the online ads market. Rivals without access to the same data could find it even more difficult to compete with Facebook.
The Commission has 90 working days to complete the investigation and see whether it's concerns are justified. This means a deadline of 22 December for a decision on whether to allow the takeover to go ahead, a year after Facebook first announced the deal.
