On Tuesday, a ruling from the European Union’s Court of Justice (CJEU) upheld a 2019 anti-trust authority ruling from the German government that directed Facebook to change how it tracks users’ web surfing behaviors and use of browser applications. This decision is widely perceived as a rebuke against parent company Meta’s EU business model.
The European Union’s Court of Justice ruling in this case will have far reaching implications. Ultimately, it will be an obstacle to Facebook’s ad targeting, according to EU authorities. It may have implications for other companies too.
The ruling effectively blocks Meta from leveraging data from its services, including WhatsApp and Instagram, in order to closely profile users for the purpose of improving its ad model.
Benchmark for Big Tech
The top EU court’s ruling on Tuesday will likely set a precedent. It may set the standard in terms of how European antitrust regulators go after Big Tech’s use of consumer data to assert market dominance.
The original 2019 decision, brought about by German antitrust officials, held that Facebook forces users to share data from WhatsApp and Instagram, and even third-party websites, unknowingly. Many users are unaware of Facebook’s policies around data collection.
This EU decision
This EU decision is not good news for Meta. In addition, in May, EU privacy authorities issued a record-setting $1.3 billion privacy fine to the company. Authorities said that because the company does not protect its content from American government authorities, the social media giant, as it exists in Europe, can no longer legally send user data to the U.S.
While Meta has not yet responded to requests for comment, it has previously assailed the 2019 German decision for improperly confusing antitrust and privacy laws.
The Head of the German antitrust authority, which brought the case, hailed Tuesday’s decision, saying that it’s a model for how antitrust law can be leveraged to properly enforce European privacy regulations.
“When large internet companies use the very personal data of consumers, this usage can also be deemed abusive under competition law,” says Andrew Mundt, head of the German Federal Cartel Office.
Consumer data use
The Luxembourg-based CJEU issued a statement calling Meta’s conduct a violation of Europe’s General Data Protection Regulation (GDPR). The latter is seen as one of the most important and comprehensive privacy protection laws in the world.
The CJEU pointed out that Meta’s data processing operation “appears also to concern special categories of data that may reveal…racial or ethnic origin, political opinions, religious beliefs or sexual orientation, and the processing of which is in principle prohibited by the GDPR.”
The court noted that national antitrust officials across the region, such as the German Federal Cartel Office, are entitled to use GDPR as a way to order companies to change their practices. It also held that users do not automatically consent to having their data mined by Meta simply by virtue of the fact that they visit and like something on a Facebook page or engage with Meta’s other platforms.
“The mere fact that a user visits websites or apps that may reveal such information does not in any way mean that the user manifestly makes public his or her data,” said the EUJC in a press release.