In an interim proceeding, the Higher Regional Court (OLG) Düsseldorf ruled in favour of Facebook's application to suspend the Federal Cartel Office's (FCO) decision of February 2019. Although only of a provisional nature, the decision makes it very likely that Facebook will win this dispute over extensive data use by digital platforms.
Background of the case
In February 2019, the Federal Cartel Office (FCO) decided that Facebook abuses its alleged market power by gathering user data from third-party websites and other Facebook-owned platforms (such as Whatsapp and Instagram) and linking it to Facebook's data. The social network's terms of use allowed for this data use. The FCO considered this an abusive imposition of unfair conditions under Sec. 19 (1) ARC. According to the FCO, Facebook users had to accept these terms of use although – according to the FCO – these terms are inappropriate under the General Data Protection Regulation. As a remedy, the FCO ordered Facebook to change its terms of use and to refrain from collecting data to the previous extent.
The decision
Now, the OLG Düsseldorf has suspended the FCO's decision. Hence, Facebook is not obliged to implement the provisions of the decision for the moment. After a summary examination of the case, the court had serious doubts over the lawfulness of the FCO's decision. Even if there were a breach of data protection rules, this would not necessarily mean an infringement of competition law. Not every breach of law is a breach of competition law at the same time.
According to the court, the use of the social networks' data caused neither competitive harm nor an undesirable development. The FCO substantiated the breach of competition law inter alia by arguing Facebook gained users' consent by making it part of the terms of use they had to agree to in order to register for the site. The court opposed this notion by declaring that there is no compulsion to consent to the conditions. Users are not dependent on the social network and can decide just as well not to register for the online platform. Especially, in case of consent, there is no loss of control for users over their data because the form of data use is stated in Facebook's terms of use.
What is next?
While courts usually phrase their decisions in such preliminary proceedings very cautiously to avoid predetermining the main proceeding, the very explicit views of OLG Düsseldorf in this case hardly provide any leeway to uphold the FCO's decision. It seems the Federal Court of Justice is going to be the next to deal with these questions arising from the digital platform's extensive use of data.
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