SA regulator refers Meta to Competition Tribunal over dominance

The Competition Commission has referred social media giant Meta Platforms (previously known as Facebook), and its subsidiaries, WhatsApp and Facebook SA, to the Competition Tribunal for prosecution.

The company is accused of abuse of dominance. 

In a statement on Monday, the commission alleged that Facebook decided in or about July 2020, and expressed an ongoing intention, to remove GovChat and #LetsTalk — a technology start-up that connects government and citizens — from the WhatsApp Business Application Programming Interface (WhatsApp Business API).

The threat to remove GovChat from the WhatsApp platform was due to an alleged violation of the contractual terms of use.

But the commission said this was in contravention of the Competition Act, which prohibits a dominant firm from abusing its dominance by engaging in exclusionary conduct geared at preventing competitors or potential competitors from entering into, participating, and expanding in a market.

The commission has asked the tribunal to impose a maximum penalty against Meta Platforms, WhatsApp and Facebook SA — an amount equal to 10% of their collective turnover.

In addition, the commission has asked the tribunal to interdict Facebook from offboarding GovChat from the WhatsApp Business API and to declare void certain exclusionary terms and conditions for access to the WhatsApp Business API. The WhatsApp Business API enables medium and large businesses, and government to, among other things, message at scale. 

The government launched a platform called the GovChat that enables the public to engage with all spheres of government  to report a wide variety of issues such as pothole locations and other service delivery requirements. GovChat also enables the government to disseminate critical information to the public such as information related to Covid-19 system tracking, testing and vaccination.

The commission said GovChat is dependent on its continued access to the WhatsApp Business API.

The commission said the intended removal of GovChat from the WhatsApp Business API will harm consumer welfare by removing the efficiency of GovChat, which allows the public to communicate with multiple government bodies through a single platform.

It said the intended offboarding will also deprive the government of the current services, and future services such as mobile payment solutions, offered by GovChat. 

“Access to digital markets has now become indispensable. In turn, access to digital markets is dependent on access to digital platforms including, as in this case, access to an important digital communication platform — the WhatsApp Business AP,” Competition commissioner Tembinkosi Bonakele said.

Bonakele said in view of the important services provided by GovChat, Facebook’s decision to offboard GovChat from the WhatsApp Business API was untenable.