Facebook’s alleged violation of EU data protection law leads to German Antitrust’s proceeding for abuse of market dominance

The Bundeskartellamt (the German AntitrustAuthority) initiated a proceeding against Facebook Inc., USA (the Irish subHaus1sidiary of the company) and Facebook Germany GmbH, Hamburg on allegations that the tech giant abused its dominant position in the social market networks market by way of imposing certain terms of service on the use of data.

The Antitrust Authority has suspicion that the T&C of the service are violative of data protection provisions. While violation of data protection law is not in itself a violation of competition law, the Authority suspects that in this instance Facebook’s use of T&C that are not compliant with data protection law is “abusive imposition of unfair conditions on users”. The Bundeskartellamt’s investigation will investigate whether the imposition of those terms derives from Facebook’s dominant position.

The Bundeskartellamt’s attention is focused on Facebook’s practice to collect a large amount of personal user data and to create user profiles for the benefit of Facebook’s advertising customers, which can more effectively target Facebook users. The way in which Facebook obtains this large amount of data is by imposing prospective users T&C that allow this data collection. Users hardly “understand and assess the scope of the agreement” that they accept when they subscribe to the service. The Bundeskartellamt harbors “considerable doubt as to the admissibility of this procedure, in particular under applicable national data protection law [and if] there is a connection between such an infringement and market dominance, this could also constitute an abusive practice under competition law.”

See Bundeskartellamt initiates proceeding against Facebook on suspicion of having abused its market power by infringing data protection rules

For more information, Francesca Giannoni-Crystal