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Facebook-WhatsApp Deal Under Investigation In The EU

|Includes:Facebook (FB)

Apparently I'm not the only one who thought Facebook's $19 billion acquisition of WhatsApp was a bad idea. European Union antitrust officials have sent an extremely detailed questionnaire to the social media's competitors, a move that could make the blockbuster acquisition vulnerable.

There has been a rising concern in Europe over American social media companies. Specifically, European telecom companies have brought forth concerns that companies such as WhatsApp leverage the industry's infrastructure, while avoiding the same regulations that govern the industry and enjoying certain tax exemptions.

One of the questions asked to competitors was if the deal would have a negative, positive or neutral impact on users and customers in mobile messaging and social networks. ""If negative, please explain why and what kind of negative impact [for example price increase, deterrence of innovation, etc]," the document said.

At this point, WhatsApp is not using users' personal data for targeted ads. It also charges just $0.99 per year after the first year.

But it's not just Facebook the EU politicians and regulators are after. The Wall Street Journal reports that Google has also been a target of the EU antitrust regulators regarding its dominance of online search in Europe.

This is simply another step by European politicians to see if they can create a better environment for European tech companies to compete. At this point, the European Commission has provisional deadline of Oct. 3 to clear the merger.

Stocks: FB