European Union: "Face-Off": Facebook, The Data Breach And The DPC

Last Updated: 8 October 2018
Article by Bryan McCarthy and Sarah Slevin

Since 25 May 2018, two of the most hotly debated questions have been: (1) when can we expect the newly-strengthened and upgraded powers of data protection authorities across Europe to be kicked into gear; and (2) who, or what, will be the first major scalp? It appears we may be approaching an answer to these questions, and the key players will surprise nobody: the Irish Office of the Data Protection Commission (“DPC”); and Facebook.

The DPC and the internet behemoth look set to take part in the first large-scale engagement of the investigatory powers of the DPC under the General Data Protection Regulation (“GDPR”) and the Irish Data Protection Act 2018 (the “2018 Act”). The intention to conduct a formal investigation involving Facebook was announced by the DPC on Wednesday last, following almost a week of fall-out from the news that the social network had suffered a data breach that impacted upon 50 million users globally (with a potential effect on a further 40 million accounts) arising out of three software flaws in its systems.

Why the GDPR, and why Ireland?

Whilst the DPC indicated that it believed less than 10% of affected accounts belonged to users within the EU, the fact of European citizens’ involvement has brought the region’s new data protection regime into play. In addition, as Facebook’s “main establishment” in the EU is in Ireland, the DPC is the company’s “lead supervisory authority” in the EU and, consequently, has overall responsibility for the GDPR’s enforcement. In accordance with notification requirements under the GDPR, Facebook informed the DPC of the breach within 72 hours of its occurrence (interestingly, it was noted by the DPC that the notification itself “lacked detail”).

Understanding the next steps

Media outlets around the world have focused on the potential financial impact of an administrative fine being placed on Facebook following the breach (estimated at up to $1.6 billion, 4% of global annual turnover), the effect of the negative publicity on the company’s share prices, and the long-term impact on the network’s reach and influence on economies, politics and society more broadly. However, in order to fully understand the possible financial and reputational effects, more basic questions as regards the investigation itself need to be considered in the first instance, including:

  1. what the DPC will be investigating;
  2. on what basis will the investigation be carried out;
  3. powers of the DPC in conducting the investigation; and
  4. the manner in which the investigation will progress.

What is being investigated?

According to the DPC itself, the investigation will examine “compliance with Facebook’s obligation under the GDPR to implement appropriate technical and organisational measures to ensure the security and safeguarding of the personal data it processes”. Deciphering the jargon, it is a requirement of the GDPR that those handling personal data ensure that such data is subject to an adequate level of security (although, in the spirit of the GDPR’s principles-based approach, no specific requirements are set out in the regulation itself).

Essentially, the DPC wants to examine the security measures employed by Facebook to protect the personal data of European users in order to determine whether they constituted “appropriate technical and organisational measures to ensure a level of security appropriate to the risk”. In this regard, account must be taken of the particular risks presented by the processing in question. If the security implemented does not, in the view of the DPC, meet the standards appropriate to the risk, Facebook would be in breach of its obligations under GDPR.

Conduct of the investigation

The DPC has a range of powers under the 2018 Act, including the power to initiate investigations in order to ascertain whether an infringement of data protection laws has occurred or is occurring. This investigation can commence on foot of a complaint received from a data subject (in the case of Facebook, as the DPC is the lead supervisory authority this complaint could be made anywhere within the EU), or, importantly, can be commenced of the DPC’s own volition.

The 2018 Act prescribes how this formal investigation will be conducted. Authorised officer(s) of the DPC will be instructed to carry out the investigation and submit a report following its completion; these instructions may limit the extent of the investigation or specify the matters or circumstances to be investigated. The data controller, in this case Facebook Ireland, must be notified of the fact of the investigation as well as the matters to which it relates and must be given a minimum of seven days (and a maximum of 28 days) to respond. In conducting the investigation, an authorised officer may do any or all of the following:

  1. enter and search a premises in which any activity connected with the processing of personal data takes place or the officer believes such activity takes place (a search warrant is necessary only in the case of a private dwelling);
  2. inspect, copy, remove or retain documents, information or data equipment from a premises;
  3. operate data equipment (and receive such assistance from any capable person as is necessary in order to do so, including being provided with passwords);
  4. issue notices requesting information;
  5. require the controller/processor (or an employee thereof) to provide information, records or documents and, if necessary, appear before the officer in order to provide such information or documents;
  6. question the controller/processor/employee (and administer an oath in order that the controller/processor/employee’s answers are given under oath);
  7. if necessary, seek an order from the Circuit Court requiring compliance by a controller/processor/employee with requests under nos. 1 to 6 above;
  8. conduct a full, private oral hearing, to include;
             a. requiring persons to attend;
             b. requiring persons to produce documents, records or other information; and
             c. examining and cross-examining the individual; and
  9. make applications to the High Court requesting restriction of data processing where it considers that there is an urgent need to do so.

The extent of these powers is clear. As well as obtaining any and all information necessary, a DPC investigation can effectively be conducted, insofar as is permitted under law, in the same manner as a court proceeding – evidence given by an individual will have the same quality as testimony given in court. Importantly, however, any statements or admissions made by a person shall not be admissible as evidence in proceedings for an offence brought against that person. It is certainly arguable that this provision, when combined with the implications of untruthful responses (i.e. perjury), will allow for more open and honest engagement by individuals when being questioned by the DPC than if a fear of prosecution were to hang over the evidence.

Investigation report

Following the investigation, the authorised officers will produce a report. A draft of this report must be provided to the controller/processor and he/she/it must be given a minimum of 28 days to make submissions to the officer on the content of the report. Following these submissions, if any, a suitably revised report is then to be submitted to the DPC by the authorised officer, and this revised report must state the officer’s belief as to whether or not an infringement of data protection law is occurring and his or her grounds for this belief. If the officer believes an infringement is occurring or has occurred he or she should not, however, include any recommendation as to corrective action or punishment; this is a matter for the DPC upon review of the report. As we know, these corrective actions include the power to impose heavy fines and/or require the controller/processor to take such actions as may be specified by the DPC. In reviewing the report, the DPC may request further information from or actions by the officer, may itself conduct an oral hearing and/or may seek submissions directly from the controller/processor.

The future

Now we know the DPC will be conducting a formal investigation into Facebook, and we understand:

  1. why it has decided to conduct such an investigation;
  2. how the investigation will proceed; and
  3. the powers that are held by the DPC and its authorised officers in conducting the investigation.

What we do not know is the outcome. For Facebook, possible outcomes include any punishment it may face as a result of the investigation but also the publicity associated with the fact of the investigation occurring. For the DPC, the public, international media and industries with significant, personal data-based activities will be examining how effectively it uses its powers and how willing it is to impose the huge fines which have been promised/threatened. More broadly, there may be outcomes for us all regarding both our future relationship with Facebook/social media generally and the protection we expect our personal data to receive from those for which our data is their business.

Footnote

1  Note that the number of offences (as opposed to simple breaches) under the 2018 Act is very small, limited to a number of matters including, for example, unauthorised knowing or reckless disclosure of personal data by a processor, disclosure of personal data obtained without authority and obstructing or impeding an authorised officer of the DPC carrying out his/her functions under the 2018 Act (the last of these is not, however, subject to the admissibility exemption).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions