Bundeskartellamt has released a ruling outlining its decision on how Facebook operates in Germany.
Bundeskartellamt, Germany’s national competition regulator, had been investigating Facebook’s business practices for three years. The organisation has revealed that it has ruled how Facebook obtains, links, authors, and handles user data gives it an ‘unfair advantage’. Bundeskartellamt stated that Facebook could leverage this advantage to strengthen its position due to its existing market dominance.
To use Facebook, account holders must agree to its terms of service. By doing so, users consent to have their data shared across other Facebook application, including Instagram and WhatsApp. However, unbeknownst to many Facebook users, they also consent to Facebook tracking their browsing history, even after they leave the Facebook platform and visit other websites.
Bundeskartellamt finished their investigation into Facebook last week. The investigators determined that the social media giant’s practices concerning user data may render Facebook victims of ‘exploitative’ abuse. Additionally, Bundeskartellamt ruled that this practice creates an unfair advantage for Facebook over its competitors as other social media platforms do not have the power to access user data in the same way.
Following its report, Bundeskartellamt aims to resolve some of the issues by preventing Facebook from combining user data that it obtains through its other applications with the data it collects through the Facebook platform. Facebook would no longer be able to gather and connect ‘data collected on third-party websites’. As Facebook uses cookie data to advertise to its users, this could have significant ramifications on Facebook’s business practices.
Andreas Mundt, president of the Bundeskartellamt, stated: “Above all, we see the collection of data outside the Facebook social network and its inclusion in the Facebook account as problematic.”
“In future, Facebook will no longer be allowed to force its users to agree to the practically unrestricted collection and assigning of non-Facebook data to their Facebook user accounts.”
“The combination of data sources substantially contributed to the fact that Facebook was able to build a unique database for each individual user and thus to gain market power.”
Facebook has had a turbulent year. The social media platform has come under fire for how it obtains and uses data. Several high-profile incidents have hit the company in recent months, such as the General Data Protection Regulation review into how the group profiles its users with advertising and the ongoing Cambridge Analytica scandal.
Following Bundeskartellamt’s decision, Facebook tried to justify its practices by claiming that, as its European HQ is based in Ireland, its practices are only subject to Irish law. Bundeskartellamt dismissed this claim as Facebook conducts business on a local level in Germany. The Bundeskartellamt also decreed that Facebook’s privacy settings page is not adequate for providing consent as all of the boxes are automatically ticked to achieve this. The organisation declared that consent should be opt-in, rather than opt-out.