On Thursday, German regulators, after a ruling, have ordered Facebook to put a stop to its data collection practices in Germany after they found that Facebook was exploiting consumers by requiring them to agree to data collection.
This law was released by the German competition authority, called the Bundeskartellamt. Andreas Mundt, president of the Bundeskartellamt, said in a press release Thursday, “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 user accounts.”
Facebook’s advertising model tracks its users from the Facebook app, WhatsApp and Instagram, collecting data on the sites and apps visited, also keeping a note of what they like, and where they shop. This data allows the company to serve ads that are more relevant to users’ interests. However, privacy advocates have maintained that Facebook does this without the user’s consent and don’t offer complete transparency.
According to a press release published Thursday, German authority’s decision covers different data sources:
- Facebook-owned services like WhatsApp and Instagram can continue to collect data. However, assigning the data to Facebook user accounts will only be possible subject to the users’ voluntary consent. Where consent is not given, the data must remain with the respective service and cannot be processed in combination with Facebook data.
- Collecting data from third-party websites and assigning them to a Facebook user account will also only be possible if users give their voluntary consent.
Bundeskartellamt’s has given Facebook one month to appeal the decision to the Düsseldorf Higher Regional Court. In a blog post published on FB newsroom, Facebook confirmed that it would appeal the decision.
“We disagree with their conclusions and intend to appeal so that people in Germany continue to benefit fully from all our services. The Bundeskartellamt underestimates the fierce competition we face in Germany, misinterprets our compliance with GDPR and undermines the mechanisms European law provides for ensuring consistent data protection standards across the EU.”
The German ruling applies to all users of Facebook based in Germany. If the decision is confirmed, Facebook would have to come up with a solution within four months to meet Bundeskartellamt’s orders.
“This is significant,” says Lina Khan, an antitrust expert affiliated with Columbia Law School. “The FCO’s theory is that Facebook’s dominance is what allows it to impose on users contractual terms that require them to allow Facebook to track them all over,” Khan says. “When there is a lack of competition, users accepting terms of service are often not truly consenting. The consent is a fiction.”
Antitrust lawyer Thomas Vinje, a partner at Clifford Chance in Brussels, told Reuters that the Cartel Office ruling had potentially far-reaching implications. “This is a landmark decision, it’s limited to Germany but strikes me as exportable and might have a significant impact on Facebook’s business model.”