The Developers Alliance application to intervene in UK Competition Appeal Tribunal proceedings brought by Meta against the UK Competition and Markets Authority’s (CMA) was granted.
London, February 15, 2022 – At a hearing before the UK Competition Appeal Tribunal on Feb. 15, 2022, the Developers Alliance made oral submissions in support of its application to intervene in the proceedings brought by Meta against the UK Competition and Markets Authority’s (CMA). The application was successful and permission to intervene was granted by the Tribunal.
Key Facts
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The appeal challenges the CMA decision to prohibit Meta’s acquisition of Giphy and impose far-reaching remedies requiring amongst other things the funding re-constitution of Giphy.
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The CMA’s decision, if left in place, will reduce startup funding and disrupt digital markets everywhere.
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The extraterritorial reach of the CMA’s actions is symptomatic of conflicting regulations in the global digital economy.
Meta acquired Giphy on May 15, 2020, in a deal that went unchallenged by both the US (where both companies are headquartered) and the EU (where Meta also operates). The merger was reviewed and allowed by the Austrian authorities (subject to limited conditions). Giphy had no links with the UK, achieved no revenue in the UK, and had no staff or operations there. The CMA issued an initial enforcement order on June 9, 2020. On November 30, 2021, the CMA informed Meta of their intention to block the merger and force the re-constitution of Giphy. Meta appealed that decision to the Tribunal.
Bruce Gustafson, CEO of the Developers Alliance, made the following statement on the application to intervene:
“Our intervention hinges on three points: whether the CMA erred in failing to properly consider the impact of the proposed merger on innovation in the industry when applying the relevant merger rules; whether the CMA failed to have due regard to international law and the principles of comity by purporting to exert extra-territorial power over a startup like Giphy with no UK nexus; and whether the CMA has unlawfully pre-empted parliament and “jumped the gun” by applying proposed merger reforms before the UK government has fully weighed their impact.
The Alliance advocates for developers. Too often developer voices are lost in the thunder of big tech and big government clashes. Too often it is small developer companies and startups that feel the brunt of new laws and over-zealous regulation. Our role is to speak for the millions of developers that are otherwise shut out of critical discussions that have tremendous consequences for their businesses and their futures.
When regulators like the CMA reach beyond their borders and bend their own rules to swat down big tech, they can harm developers, innovation, and competition everywhere. Startup funding disappears, entrepreneurs lose heart, and consumers miss out on the next wave of digital invention. This is true regardless of whether Meta wins or loses their challenge – should the CMA prevail on the points we’re challenging. There are thousands of Giphy’s that will live or die by what the tribunal decides. We are asking to let them be heard.”
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About The Developers Alliance
The Developers Alliance is the world’s leading advocate for software developers and the companies invested in their success. Alliance members include industry leaders in consumer, enterprise, industrial, and emerging software development, and a global network of more than 70,000 developers.
