The German competition authorities: Facebook abused its dominant position

By senior intern Clement Hoff Munk

Background

Facebook had for some time been collecting data from the social media WhatsApp and Instagram (both owned by Facebook) and from third parties. The data were then combined with data from each user's Facebook profile for the purpose of painting a detailed picture of the user's preferences and habits. 

The Bundeskartellamt's decision

On 7 February 2019, the Bundeskartellamt, Germany's federal competition authority, established that Facebook had abused its dominant position by making access to third-party data a condition for allowing users access to Facebook. Facebook's conduct was held to be a so-called "exploitative abuse" to the detriment of Facebook's users. Facebook's conduct was also deemed able to impede actual or potential competitors that did not have the same possibility of combining data from multiple sources to create such detailed pictures of the users. Furthermore, Facebook's failure to obtain the users' consent was a breach of the data protection rules.

The Bundeskartellamt has now decided that Facebook's future collection of third-party data must be subject to each user's prior "voluntary consent". If Facebook does not obtain such consent, the competition authority has ordered Facebook to significantly reduce its collection and use of data.

What next?

Facebook has not been fined by the Bundeskartellamt, but the decision implies that Facebook from now on will be forced to significantly alter its data collection. In this connection Facebook must ensure that the users are sufficiently informed of the ongoing data collection. 

The decision is an example of application of the competition rules in a "big data" context.

The Bundeskartellamt's decision is not final; according to Facebook, the decision will be appealed.