Facebook To Appeal German Privacy Ruling

Andreas Mundt president of Germany's Federal Cartel Office addresses a news conference presenting findings of the anti-trust

Germany's Federal Competition Office (FCO) said Thursday it would impose new limits on how Facebook collects data from subsidiaries Whatsapp and Instagram, as well as third-party websites with embedded Facebook features such as "Like" buttons.

Announcing their decision, they said Facebook-owned services such WhatsApp and Instagram can continue to collect data, but users will have to consent before the information is assigned to Facebook accounts.

Among other conditions, private use of the network is subject to Facebook being able to collect an nearly unlimited amount of any type of user data from third party sources, allocate these to the users' Facebook accounts and use them for numerous data processing processes. "The combination of data sources", the cartel authority said, "substantially contributed to the fact that Facebook was able to build a unique database for each individual user and thus to gain market power". In another case, Facebook will have to ensure that the data it is using will not be combined without user consent for the next four months.

"The Bundeskartellamt's decision misapplies German competition law to set different rules that apply to only one company", Facebook said. The regulator's order explicitly said that Facebook cannot block users from using its services if they disagree with the data merger from different sources. The decision is not about Facebook's processing of data generated by its own site, which the Cartel Office acknowledged is the business model for data-based social networks such as Facebook. The body stated that the social media giant has been gathering information about people by following their activities on other websites and apps like Instagram. The Federal Cartel Office said Facebook will need each user to sign off on linking their Facebook accounts with Instagram and WhatsApp data or keep the data separate.

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The Bundeskartellamt's ruling prohibits the social networking giant from combining records across the three services without first obtaining user consent.

The agency's boss Andreas Mundt said: 'As a dominant company Facebook is subject to special obligations under competition law. With the Cambridge Analytica controversy, and ongoing reports of political interference by foreign groups, Facebook has been doing all it can to show that it is responsible, that it is able to manage and make effective, secure use of the vast data insights that its 2.3 billion users give it access to. Since then Facebook has faced countless questions about its privacy practices from governments around the world. Germany has consistently been one of the leading nations attempting to tackle the power and influence of the internet players, creating a more tightknit regulatory framework which you would naturally expect in business.

The German regulator also noted that Google+ would be shutting down in April of 2019 and that Facebook's other competitors like Snapchat, YouTube, and Twitter only offer "parts of the services" that Facebook does. In response, Facebook says it disagrees with the order and will appeal.

In a blog post, Yvonne Cunnane, head of data protection at Facebook Ireland and Nikhil Shanbhag, director and associate general counsel at the company, said: "The GDPR specifically empowers data protection regulators - not competition authorities - to determine whether companies are living up to their responsibilities". Tellingly, the company didn't mention how numerous 40 percent of non-Facebook users had installed Instagram or WhatsApp and glossed over the ubiquity of its "like" and "share" buttons entirely.

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