Germans stomp on Facebook over ‘illicit’ data sharing

germany_1The German high court has upheld an order for Facebook to stop the “illicit” practice of collecting and using customers’ data for advertising purposes because it does not have “qualified” consent.

Back in February 2019, the German Federal Cartel Office made a landmark decision on Facebook’s advertising model, ordering the company to stop sharing user data, ruling that one click to agree to its huge terms and conditions was not enough because users had no choice other than to agree to everything.

The regulator was breaking new ground by using antitrust law to tackle data privacy.

However, in August 2019 Facebook won a suspension of the antitrust decision in a lower tribunal and this week applied to the Federal Court of Justice in Karlsruhe to keep the order suspended while the sides continue to argue over it.

But now judges have ruled that Facebook must comply with the original order. They maintained that it does not matter whether Facebook’s T&Cs are in line with GDPR, and argued that they are “illicit” because they do not give users the right to choose between allowing Facebook to track them or to limit data collection to what they post on their accounts.

In a statement the court said: “As a dominant network, Facebook has a special responsibility to keep competition alive on the social-network market. The high economic value of data must also be taken into account.”

Presiding judge Peter Meier-Beck added: “We have no doubt that Facebook has a dominant market position on the social network market and that it misuses its position.”

Meanwhile, Andreas Mundt, head of the Federal Cartel Office, commented: “Data is a crucial factor for economic power and for judging market power on the Internet. If data is collected and used illegally, antitrust law must be able to step in to impede misuse of market power.”

In response, Facebook said it will continue to fight the order in the Dusseldorf court where the main case is pending.

“Today’s decision relates to the preliminary proceedings on the stay order,” Facebook said. “The main proceedings, before the court of appeals, are ongoing and we will continue to defend our position that there is no antitrust abuse.”

The move comes as the social media giant is facing a growing advertiser boycott in support of Black Lives Matters campaigners, who are calling for brand owners to pressure Facebook into taking more action over racist content and misinformation.

Earlier this week, Unilever’s Ben & Jerry’s ice-cream brand became the latest brand to announce a temporary boycott of the site, joining Patagonia and The North Face.

According to a report on Business Insider, founder and chief executive Mark Zuckerberg, chief operating officer Sheryl Sandberg and vice-president of global marketing solutions Carolyn Everson have held a meeting with agency groups and clients, including Omnicom, Dentsu Aegis Network, Anheuser-Busch InBev, Nestlé and Unilever to explain the company’s position over hate speech and political content moderation.

Zuckerberg reportedly insisted that Facebook is reviewing its policies but also claimed the company abides by freedom of expression and neutrality.

Even so, it seems that the regulators are finally getting to grips with the US tech giants’ dubious data practices. Earlier this week, a French court also ordered Google to overhaul its privacy policies to ensure the company is “crystal clear” about what it does with users’ personal data.

Related stories
Google must ditch ‘forced consent’, French court rules
Google nemesis denounces internal data ‘free-for-all’
Failure to enforce GDPR ‘fuelling Google’s dominance’
Duopoly braced for new probe of ad market dominance
Turning up the heat: Brussels opens duopoly data probe
Digital ad duopoly threat to human rights, says Amnesty
Google and Facebook swat off threats and tighten grip

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