LUXEMBOURG (CN) — Facebook's parent company Meta is asking the European Union’s highest court to overrule a decision by Germany’s competition watchdog that found Facebook abused its position as the largest social network in the country to violate data protection regulations.
The European Court of Justice held a hearing Tuesday over whether the German Federal Cartel Office, or the Bundeskartellamt, overstepped its authority when it concluded in 2019 that Facebook was using its dominance in the social media market to violate EU data privacy laws and ordered it to stop sharing data across its platforms.
The case, referred to the top EU court by the Higher Regional Court in Düsseldorf, stems from the landmark decision by the FCO ordering Meta to stop bundling information from its suite of apps, including Facebook, Instagram and WhatsApp, to sell to advertisers.
“Access to data is a key competitive parameter not only in the advertising market, but also in the social network market. Facebook's access to a significantly larger database further strengthens the already pronounced lock-in effects,” the FCO said in a statement at the time. According to the agency, Facebook has 95% of the market share in Germany.
The Silicon Valley giant argues that the FCO overstepped its bounds in issuing the ruling because data protection complaints are the purview of the German Federal Data Protection Authority, not the competition regulator.
"The Bundeskartellamt has openly undermined the substantive and procedural requirements of the GDPR legislation," Meta’s lawyer Hans-Georg Kamann told the EU judges Tuesday.
The 2018 General Data Protection Regulation governs data protection and privacy in the EU. The FCO’s decision was the first time a European cartel regulator had used the legislation to bring a complaint for anticompetitive behavior.
During Tuesday’s hearing, Meta also complained that the FCO failed to properly consult national data protection authorities before proceeding with its decision. FCO had “one one-hour telephone call with Irish data protection authority,” Kamann told the 15-judge panel of the Luxembourg-based court.
Meta has its European headquarters in Ireland, making the Irish Data Protection Commission the first port of call for Facebook-related privacy violations. Meta’s lawyers also criticized the German authorities for failing to provide relevant evidence because hundreds of pages of documents were only available in German.
The German competition regulator pushed back against those allegations.
“It’s clear that the Federal Cartel Office involved all relevant data protection authorities.” Konrad Ost, vice president of the FCO, told the court in his opening statements.
Later in the hearing, in response to a question from a judge about contact with the Irish Data Protection Commission, Ost said it wasn’t clear what would have happened if the Irish government had a similar investigation underway, but he argued that was merely a hypothetical. “Everyone was in favor, nobody spoke out against it,” he said, referring to both the Irish and German data protection authorities.
The European Court of Justice ruled against Meta last month after the company contested a move by a German consumer watchdog to bring proceedings against the company. The Court of Justice found that the GDRP doesn’t limit privacy breach complaints to national data protection authorities and groups “in the pursuit of the public interest” can take Facebook to court as well.
Last week, the Bundeskartellamt announced that Meta will face further scrutiny under a new German law that allows authorities to intervene earlier against digital companies. For the next five years, Meta will be subject to special abuse control by the FCO, joining Apple and Google, which have also been given this status as companies with “paramount significance across markets.”
On Monday, Sven Giegold, German's deputy minister for economic affairs, called on Brussels to break up tech companies that breach competition rules. “Market investigations and structural remedies should also be on the table,” he said.
An opinion from Advocate General Lucia Serena Rossi in the FCO case is expected in the fall. Although final rulings are not bound by the opinions of the court’s advisers, their legal reasoning is often similar.
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