ICA: probe started for abuse of economic dependence by Meta towards SIAE

According to the Authority, Mark Zuckerberg’s company could have unduly interrupted the negotiations for licensing the use, on its platforms, of musical rights thus abusing of SIAE’s economic dependence. At the same time a proceedings for interim measures has been initiated.

The Autorità Garante della Concorrenza e del Mercato (Italian Competition Authority - AGCM) started a probe against Meta Platforms Inc., Meta Platforms Ireland Limited, Meta Platforms Technologies UK Limited and Facebook Italy S.r.l. (Meta Group) for an alleged abuse of economic dependence while negotiating with SIAE, the main Italian collecting society for artists’ rights, the licensing of the use of music rights on Meta’s platforms.

Specifically, Meta could have unduly interrupted the negotiations for renovating the expired contract and at the same time having removed from its social platforms the musical content whose rights are represented by SIAE: Meta could also have denied to SIAE all the information needed to carry out negotiations based on the principles of transparency and equity, as requested by the Italian relevant legislation.

According to the Authority, Meta could have exploited its bargaining advantages by requesting SIAE to accept an unfair economic offer without providing to SIAE the relevant information to assess the economic fairness of the offer. After interrupting the negotiations, Meta removed from its platforms all musical content of artists represented by SIAE, thus preventing its use by consumers. The Authority believes that Meta’s alleged abuse of economic dependence could also have a significant impact on competition in the affected markets and cause great harm to consumers.

Meta’s conduct not only could significantly hamper SIAE’s competitiveness on the affected markets, but it could also prevent the authors represented by SIAE – who are a significant share of all Italian authors – to reach consumers that more and more use social platforms. Meta’s conduct could also affect authors represented by other collecting societies but whose rights are co-managed by SIAE. Moreover, Meta’s conduct obstructing the access of SIAE’s musical content to Meta’s platforms could also impact negatively on the remuneration of musical works and of all other legal positions protected by copyright law. Those alleged abuse could also significantly limit consumers’ choice, who could be deprived of the chance of using musical works whose rights SIAE represents and that are a large share of Italy’s and international musical offer.

When opening the probe, the Authority at the same time initiated proceedings that could lead to the adoption of interim measures in accordance to article 14bis of the Italian Competition Act nr 287/1990. The interruption of the negotiation between Meta and SIAE could in fact immediately affect competitive dynamics among parties acting as intermediaries of copyrights of musical works. Hence follows the need of interim measures that are supposed to ensure that the negotiating process between SIAE and Meta can restart according to the principles of good faith, transparency and equity.