UK: UK Data Protection Watchdog Intends To Impose Maximum Fine On Facebook

Last Updated: 17 July 2018
Article by James Seadon

The information Commissioner's Office (ICO) has published two reports detailing its investigation into the use of data analytics in political campaigns. The first report includes proposals to fine Facebook £500,000—the maximum allowed—for two alleged breaches of the Data Protection Act 1998 (DPA 1998), while the other includes a recommendation for the government to introduce a statutory Code of Practice for the use of personal data in political campaigns. Ian Wilson, partner at Brett Wilson LLP and Dr Mark Leiser, lecturer in law at the University of Leicester highlight the reputational damage the proposed fine has for Facebook, whereas Dan Whitehead, senior associate at Kemp Little, demonstrates how the report reveals the complexity of the data sharing networks that now exist between public and private sector organisations. James Seadon, partner at Fieldfisher, draws on the report's broader implications, while Professor Steve Speers at the University of Essex, argues that data protection law—as well as electoral law—need a 'complete overhaul' if they are to keep abreast of the pace of change set by social media. And Danielle Amor, senior associate at Pannone Corporate, warns that, in the age of big data, it is not just social media companies who need to pay heed to the example the ICO has made of Facebook.

In March 2017, the ICO began examining the use—and potential misuse—of personal data by campaigns on both sides of the EU referendum. In May 2017, it widened its scope, launching a further investigation into political parties, data analytics companies and major social media platforms.

The progress report provides details of some of the organisations and individuals currently under investigation. These include:

  • 29 other social media companies
  • political campaign groups
  • political parties
  • other commercial actors

Dan Whitehead, senior associate at Kemp Little, highlights that the 'breadth of the investigation provides a useful illustration of the complex nature of the data sharing networks that have been established between both public and private sector organisations. It should also serve as a warning to companies who seek to either share with or purchase personal data from third parties about the potentially high regulatory risks of doing so'. For example, the report alleges that a data analytics firm, Aggregate IQ—which worked with Vote Leave during the EU referendum campaign, itself chaired by prominent politicians, such as Michael Gove and Boris Johnson—had access to UK voters' personal data. The ICO is now investigating whether this information was transferred and accessed outside the UK and whether this amounted to a breach of DPA 1998.

With regards to the ICO's investigation of Facebook, Ian Wilson, partner at Brett Wilson LLP, highlights that 'at all material times the governing law was DPA 1998, which imposed a number of obligations on data controllers known as "Data Protection Principles". These include requirements to process personal data fairly and to have appropriate technical measures in place to ensure that personal data is secure—respectively, the first and seventh Data Protection Principles. These are the obligations Facebook is said to have breached'.

Since February 2018, Facebook—alongside the data analytics firm Cambridge Analytica (CA)—has been the focus of the ongoing investigation after evidence emerged that a third-party app was used by CA to harvest the data of 87m unwitting Facebook users across the world. The ICO's investigation concluded that Facebook 'contravened the law by failing to safeguard people's information'. It also found that the company 'failed to be transparent about how people's data was harvested by others', such as CA. The ICO also plans to bring criminal actions against CA's now defunct parent company, SCL
elections.

'At a crossroads'
'We are at a crossroads,' said information commissioner, Elizabeth Denham in a statement. 'Trust and confidence in the integrity of our democratic processes risk being disrupted because the average voter has little idea of what is going on behind the scenes. 'New technologies that use data analytics to micro-target people give campaign groups the ability to connect with individual voters. But this cannot be at the expense of transparency, fairness and compliance with the law'.

'Bad actors'
The ICO has issued a Notice of Intent to fine Facebook £500,000 for alleged data breaches—the maximum possible under DPA 1998. 'Fines and prosecutions punish the bad actors, but my real goal is to effect change and restore trust and confidence in our democratic system', claimed Denham. However, as Wilson illustrates, Facebook's fine is relatively small compared to those than can be imposed under the General Data Protection Regulation (GPDR): 'Facebook should be grateful that these breaches occurred under DPA 1998. DPA 1998 has now been repealed and replaced by the GPDR and Data Protection Act 2018 (DPA 2018). The maximum sanction for breaches under the new legislation is €20m (£17.7m) or 4% of annual global turnover, whichever figure is higher. In Facebook's case, this could mean a fine of over $1.6bn (£1.2bn). 'While some might say Facebook has got off lightly here, the exposure of the breach and the ICO's sanction will inevitably damage Facebook's reputation as it diminishes trust in the platform amongst users'.

Dr Mark Leiser, lecturer in law at the University of Leicester, echoes this notion of reputational damage outweighing the fine for Facebook, claiming that 'this will be seen as a political event as much as a data protection one. And although one outcome might see Facebook making representations to the ICO that result in the fine reduced to nothing, I don't suspect Facebook will be sending the ICO any friend requests any time soon'. James Seadon, partner at Fieldfisher, builds on this insight, highlighting the 'broader implications' of the ICO's Notice of Intent: 'The Commissioner's statement signals her close interest in the broader data sharing economy. And her decision to publish the Notice of Intent—something that is normally kept private until the fine itself is levied—reflects not only the substantial public interest in this matter but also the ongoing political scrutiny'. Facebook has a chance to respond to the Commissioner's Notice of Intent, after which a final decision will be made.

'Democracy disrupted?'
The ICO also published a second, partner report entitled 'Democracy disrupted? Personal information and political influence', which outlines the findings and recommendations arising out of the 14-month investigation. Among the ten recommendations is a call for the government to introduce a statutory Code of Practice under the DPA 2018 for the use of personal data in political campaigns. The ICO has volunteered to work closely with the government to determine the scope of the code. The report also stressed the need for an 'ethical pause' to allow government, parliament, regulators, political parties, online platforms and the public to 'reflect on their collective responsibilities in the era of big data before there is a greater expansion in the use of new technologies'. Professor Steve Speers at the University of Essex concurs with this notion, claiming that a 'complete overhaul is necessary to ensure that limits on spending, foreign interference and unaccountable dishonesty in elections are effectively enforced'.

The ICO said it expects the next stage of its investigation to be complete by the end of October 2018.

'Serious sanctions'
However, Danielle Munro, senior associate at Pannone Corporate, warns that, in the age of big data, other global businesses should pay heed to the example the ICO has made of Facebook: 'Social media platforms and political parties and campaigns are clearly high on the ICO's current agenda, but other global businesses ought to take note too. Failure to provide sufficient information to individuals, to properly safeguard personal data and to take prompt and effective measures in response to a data breach are all likely to attract serious sanctions for data controllers in future'.

Source: Report: Findings, recommendations and actions from ICO investigation into data analytics in political campaigns

This article was first published on LexisPSL on 11/07/2018

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
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
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