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German court suspends competition authority’s order against Facebook

The Bundeskartellamt had ordered Facebook to stop ‘unrestricted data collection’.

Background: The German competition authority the Bundeskartellamt issued a ruling in February 2019, stopping Facebook from forcing its users to agree to ‘practically unrestricted collection’ and assigning of non-Facebook data to their Facebook user accounts. It mandated the company to seek ‘voluntary consent’ and not to threaten users to stop providing its services if they do not agree. The Kartellamt called this ‘internal divestiture’ of Facebook’s data, and noted these practices have allowed Facebook to gain market power. Finally, the authority condemned Facebook’s data collection practices as violating EU data protection rules, and detrimental to users.

Facebook’s appeal is successful, for now: Facebook had the right to appeal the ruling, and did so. The Higher Regional Court in Düsseldorf ruled in favour of the company, expressing doubts about the alleged infringement of competition law, even in the assumption that Facebook’s practices had breached data protection laws. The court also argued Facebook’s data collection does not constitute exploitative abuse, and there is no causality between its alleged market dominance and its practice to collect data.

What happens now? The court’s ruling suspends the decision of the Bundeskartellamt. The authority has in turn the right to appeal, and has already announced it will do so, arguing that data is the market power factor in today’s digital society.