Facebook snagged in Germany over data
BONN, Germany: Facebook has been ordered to curb its data collection practices in Germany after a landmark ruling on Thursday that the world’s largest social network abused its market dominance to gather information about users without their consent.
Germany, where privacy concerns run deep, is in the forefront of a global backlash against Facebook, fuelled by last year’s Cambridge Analytica scandal in which millions of Facebook profiles were harvested without consent.
The country’s antitrust watchdog objected in particular to how Facebook pools data on people from third-party apps, including its own Whatsapp and Instagram, and its online tracking of people who aren’t even members through “like” or “share” buttons.
“In future, Facebook will no longer be allowed to force its users to agree to the practically unrestricted collection and assigning of non-facebook data to their Facebook accounts,” Federal Cartel Office chief Andreas Mundt said.
Facebook said it would appeal the decision, saying the regulator underestimated the competition it faced.
“We intend to appeal so that people in Germany continue to benefit fully from all our services,” Facebook said in a blog post.
In its order, the cartel office said Facebook would only be allowed to assign data from Whatsapp or Instagram to its main Facebook app accounts if users consented.
Collecting data from third-party websites and assigning it to Facebook would similarly require consent.
If consent is withheld, Facebook would have to restrict its collection and combining of data.
Antitrust lawyer Thomas Vinje, a partner at Clifford Chance in Brussels, said the ruling had potentially far-reaching implications.
“This is a landmark decision,” he told Reuters. “It’s limited to Germany but strikes me as exportable and might have a significant impact on Facebook’s business model.”
Vinje said it would be tough for Facebook to persuade the court that the office’s definition of the market for social media, and its dominance, were misguided. This is a battle that many firms have fought in court and lost, he added.
German Justice Minister Katarina Barley welcomed the ruling.
“Users are often unaware of this flow of data and cannot prevent it if they want to use the services,” she told Reuters.
The German antitrust regulator’s powers were expanded in 2017 to include consumer protection in public interest cases where it could argue that a company, such as Facebook, had so little competition that consumers lacked any effective choice.
Facebook has an estimated 23-million daily active users in Germany, giving it a market share of 95%, according to the Cartel Office, which considers Google+, a rival social network that is being closed down, to be its only competitor.
Facebook said the office failed to recognise the extent of competition it faced from Google’s Youtube or Twitter for users’ attention, and also said the regulator was encroaching into areas that should be handled by data protection watchdogs.
Facebook is considering appealing on the data protection issues to the European Court of Justice, but here the Federal Cartel Office may also have the upper hand, said Vinje.
“It seems to me that the Federal Cartel Office has based its decision squarely on competition law,” he said.
The European Commission said: “We are following the work of the Bundeskartellamt both in the framework of the European Competition Network and through direct contacts.
“The European legislator has made sure that there is now a regulation in place that addresses this type of conduct, namely the General Data Protection Regulation,” it added.
Facebook said it had rebuilt the controls people have over their information, and improved the privacy “choices” that they are offered. It would also soon launch a “clear history” feature, it said. | Reuters