Facebook falls foul of German consumer law

25 Feb 2019

Germany’s national competition authority, Bundeskartellamt, has delivered its decision as part of the abuse of dominance proceedings it is bringing against Facebook in Germany. The proceedings focus on the collection and use of user data from third party sources and whether Facebook has used its position of market dominance to force users to consent. Bundeskartellamt has not considered whether Facebook’s behaviour constitutes a breach of data protection rules and it is not yet clear whether Facebook may be open to further investigations by data protection agencies which could lead to substantial fines. 

Bundeskartellamt ruled that the social media giant has abused its market dominance to collect, merge and use data of its users. The decision stated that Facebook-owned services (such as WhatsApp and Instagram) can continue to collect data but Facebook is not allowed to assign such data to a Facebook user’s profile without specific consent from that user. Where consent is not given, that data must stay with the service that collected it and not be processed in combination with data collected by Facebook. Data collected from third party websites can also only be assigned to a Facebook profile with specific consent from the user.

In order to determine whether users consent, Facebook must amend its terms and conditions to include a voluntary consent option to its users in Germany. At present Facebook exclude users who do not consent to their data being collected and combined with data collected from third party apps and websites to create a detailed profile about their internet use. Given the social media website’s market dominance, Bundeskatellamt stated that they must consider the fact that users are unable to switch to another service and so must be given the option whether or not to consent without being blocked from using the service if they choose the latter.

Facebook is currently considering its response and had one month to appeal the decision. Facebook has confirmed that it will appeal the decision.

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