The German competitions regulation, the Federal Cartel Office (FCO), has ordered social networking site Facebook to considerably restrict the ways it collects and combines user data, unless consent is specifically given by the user.
The watchdog, known in Germany as Bundeskartellamt, has carried out an investigation into the social media site and has voiced its concerns that Facebook users are unaware of the extent of the site’s activities in terms of their data.
As well as data collected from Facebook itself, the FCO has included data gathered by the company from third party sites it owns, including messaging app WhatsApp and photo-sharing site Instagram. The American company has stated that it plans to appeal the decision.
The FCO has specifically ruled that Facebook can continue to gather data from its various services, but must not combine it with data it collects from the main Facebook site unless the user gives voluntary consent. Furthermore, Facebook can collect data form other third party sites and assign it to the user’s account, again if the user gives their permission first.
The German watchdog stated that an obligatory tick the box function to agree to all of the site’s terms was not a sufficient basis for obtaining permission for an intensive data processing campaign.
While the ruling is only applicable to Facebook’s activities in Germany, this could pave the way for other regulatory bodies across the world who may be influenced by the outcome of this, especially if Facebook’s appeal is rejected.
Facebook has hit back at the FCO, stating that it has crossed the line by pursuing matters of data privacy that fall in the jurisdiction of a different regulator. It also believes that the FCO has overlooked the steps the social site has taken to become compliant with GDPR, which came into effect last summer. The social site has one month to make its appeal before the FCO’s rulings become legally binding and effective.
However, if the appeal is rejected, Facebook must develop a number of technical processes and solutions to ensure that it complies with the FCO’s demands within four months. The penalty for failing to comply is a fine of as much as 10% of the company’s annual revenue.
The FCO believes that its actions are justified as it believes that the social enterprise has abused its position as the dominant market leader to gather data about users.
The ruling could affect social sharing buttons on other sites that allow Facebook to track users’ IP address, web browser and other details used for identification, even if the user doesn’t click these buttons. It could also interfere with the Facebook Pixel, which adds code to third-party sites to allow owners who run ads on the social site to personalise them.
Facebook has defended its practice,s stating that they are useful in helping to show ads that are more relevant to users, and that it allows advertisers to measure the success of their campaigns. It also says that it makes it easier for the company to recognise fake accounts on the site and protect its users.
The FCO is also planning a separate investigation into online retail site Amazon.
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