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Boaz Golan


Israel Competition Authority Takes Aim at Facebook

On December 13, 2020, Israeli media published that the Israel Competition Authority (“ICA”) is considering taking enforcement measures against Facebook for failure to submit mandatory merger notices in relation to several acquisitions made by Facebook in Israel over the past several years.

The ICA is claiming that Facebook fully implemented several acquisitions of Israeli technology companies, without proper notifications. Furthermore, the ICA is also looking into other international companies that may have acted in the same manner.
The publication comes in conjunction with two major antitrust lawsuits filed against Facebook by the U.S. Federal Trade Commission (“FTC”) and 48 U.S. state attorneys general just last week, claiming that Facebook has entrenched its monopoly over the social networking market by buying companies that present competitive threats (a/k/a ”killer acquisitions”) and by imposing restrictive policies that hinder potential rivals that it cannot acquire.

One of the mergers at the heart of these lawsuits is the 2013 merger of Facebook and Israeli user surveillance start-up Onavo. It should be noted that the ICA is also examining this merger as part of its demand. The FTC complaint states that by acquiring Onavo, Facebook has made a conscious effort to detect and evaluate competitive threats early and neutralize them before they have a chance to fully grow:


"Onavo marketed itself to users as providing secure virtual private networking services, but—unknown to many users—it also tracked users’ online activity....
By acquiring Onavo, Facebook obtained control of data that it used to track the growth and popularity of other apps, with an eye towards identifying competitive threats for acquisition or for targeting under its anticompetitive platform policies.


Though Facebook closed the operations of Onavo in 2019, it continues to track and evaluate potential competitive threats using other data, the FTC claims.

Failing to file a merger notification in Israel can lead to monitary fines, and if the ICA views the merger as likely to weaken competition, it may also lead to criminal enforcement and to a judicial order to undo the merger (“unscramble the eggs”). 


We will be happy to assist you with any question and / or clarification.

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¹ https://www.ftc.gov/system/files/documents/cases/1910134fbcomplaint.pdf  
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The content in this Memo is provided for informational purposes only, and does not serve to replace professional legal advice required on a case by case basis. The Firm does not undertake to update the information in this Memo, or its recipients, about any normative, legal, or other changes that may impact the subject matter of this Memo.
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Should you have any questions or need additional information regarding this matter, please feel free to contact Adv. Boaz Golan, Partner, Head of the Antitrust and Competition Department: boaz.golan@goldfarb.com; Adv. Nimrod Prawer, Partner, Antitrust and Competition Department: nimrod.prawer@goldfarb.com; Adv. Zohar David, Partner, Antitrust and Competition Department:  zohar.david@goldfarb.com; or at: +972-3-6089850.