Meta Platforms Inc.’s Facebook suffered a setback in its European Union court challenge of a German antitrust decision that ordered an overhaul of the social media giant’s business model.
(Bloomberg) — Meta Platforms Inc.’s Facebook suffered a setback in its European Union court challenge of a German antitrust decision that ordered an overhaul of the social media giant’s business model.
Competition authorities probing a company over alleged abuses of a dominant position are justified to also consider other rules, such as the EU’s General Data Protection Regulation in the course of an investigation, an adviser to the bloc’s top court said on Tuesday in a non-binding opinion. Such a ruling would hit at the heart of Meta’s appeal.
When interpreting other rules such as data protection law, competition watchdogs are “bound by the duty to cooperate in good faith” with the relevant privacy regulators and “must, in full mutual respect, assist each other in carrying out tasks which flow from” EU law Athanasios Rantos, an advocate general at the EU Court of Justice, said.
Tuesday’s case is viewed as a test of how far antitrust regulators can go to make sure Silicon Valley firms don’t mishandle massive data sets gleaned from users to cement their market power. Meta told the EU Court of Justice in a May hearing that Germany’s Federal Cartel Office conflated data protection and antitrust law in violation of its actual powers. Its decision was flawed and the authority’s approach “misguided,” it said.
Facebook’s Model Attacked by German Antitrust Regulator
The case was referred to the EU court by judges in Germany who sought the EU court’s guidance on whether a violation of data regulations can be cited in an antitrust case. It’s one of several challenges the tech firm is facing in Europe, including from privacy watchdogs.
The EU court often follows opinions in its final ruling, which could come in the next four to six months.
“We await the final judgment to determine any next steps,” Meta said in a statement.
The court adviser’s view that data protection law can play an important role in antitrust investigations “is good news,” the German authority’s president Andreas Mundt said in a statement. He said the opinion had confirmed his office’s position “on key points.”
Meta in its challenge accused the German antitrust authority of violating a key EU principle of “sincere cooperation,” by failing to include the Data Protection Authority in Ireland, where Meta has its EU base, in its investigations, before adopting a final decision.
Rantos on Tuesday said that “EU law does not provide detailed rules on cooperation between a competition authority and supervisory authorities within the meaning of the GDPR in such a situation,” and that antitrust watchdogs are subject “at the very least, to a duty to inform and cooperate with the competent authorities.”
The EU’s GDPR, which took effect in 2018, gave data watchdogs unprecedented fining powers and also made those authorities, where a firm has its EU base, the main supervisor over them.
The case is: C-252/21, Facebook Inc. and Others v. Bundeskartellamt.
(Updates with German cartel office’s response in the eighth paragraph)
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