Facebook Inc. will undergo extensive UK reviews of its $ 400 million purchase of GIF search engine Giphy Inc. after it has failed to provide permission to deal with fraud issues.
The Competition and Markets Authority said it would conduct a so-called second phase investigation until September 15, according to a statement sent by email on Thursday.
The decision comes after the organization warned that the binding could harm its rival social media. Concerns have been raised that this agreement could allow Facebook to shut down Giphy’s library of video clips and animated videos from competing services such as Apple Inc. iMessage, Twitter, Signal, TikTok and more.
UK regulators are taking a hard look at technology deals where giants swallow small firms. CMA officials have expressed remorse for posting game-changing deals in the past, such as Facebook’s take on Facebook. CMA Chief Executive Officer Andrea Coscelli said in October that major technology companies should be considered for what they do in any transaction, no matter how small.
Facebook has sent a statement via email saying it will continue to work fully with CMA.
“This integration is very competitive and benefits everyone in the U.S. who uses Giphy and our services – from developers to service providers to content creators,” the communication network added.
As part of its initial investigation, the CMA said it had found that Giphy planned to expand its digital marketing relationship with other countries as well.