Protecting consumers and their data through competition law? Rethinking abuse of dominance in light of the Federal Cartel Office’s Facebook investigation

Abstract

The Facebook proceeding of the German Federal Cartel Office is the latest among a number of competition law investigations that target large US-American technology companies. The Office suspects that Facebook abused its dominant position on the market for social networks by imposing unfair data privacy conditions upon its users. This preliminary finding presents a legal novelty because it relies mainly on the fact that the company violated rules outside of competition law, namely data protection law. This calls for a wider evaluation of the currently debated relationship of competition and data protection law. We investigate if such an abuse theory is also conceivable under EU competition law, specifically under Art 102 TFEU. Although the Court of Justice of the European Union separates competition and data protection law strictly, it hinted at a different understanding in a recent judgment. Also, the sentiment of the nascent 'Vestager School' with its emphasis on fairness may support this theory of an abuse. We conclude that this novel concept is conceivable under EU law.

The German Facebook Case: The Law and Economics of the Relationship between Competition and Data Protection Law

“…13 See Bundesgerichtshof (2020) 14 See, e.g., Witt (2020, 32-35), Podszun (2020Podszun ( , 1276. 15 See, e.g., Schneider (2018), Volmar/Helmdach (2018), Colangelo/Maggiolino (2018, Botta/Wiedemann (2019), Haucap (2019), Këllezi (2019), Körber (2019), Budzinski et al (2020), Buiten (2020), Witt (2020), Podszun (2020. 16 Most legal scholars that welcome the Facebook decision think that the behaviour of Facebook could also be seen as a violation of Art.…”

“…102 TFEU). In chapters 5 and 6 we will see how the new proposal of the Digital Market Act relates to this discussion, because it entails a 23 See, e.g., Schneider (2018), Volmar/Helmdach (2018), and also Costa-Cabral/ Lynskey (2017, 30-38). 24 See Buttarelli (2019).…”

The Economics of the German Investigation of Facebook’s Data Collection

“…In general, Ezrachi & Robertson (2019) show that third-party tracking is a growing industry and has its market power implications: tracking capacity should be ex ante considered in merger review and it may trigger an ex post analysis due to an adverse impact on the consumers. Since Facebook's practices are not restricted to Germany, some authors also discuss whether the FCO decision could set up a precedent in the EU (inter alia, Volmar & Helmdach 2018;Colangelo & Maggiolino 2018;Wils 2019;Robertson 2020). Schneiders (2019) provides an assessment of the case from the perspectives of communication science, media economics and law and stated that personal data can be seen as an anticompetitive…”

“…Some articles use Facebook case as an example to illustrate general concerns in datadriven markets (Botta & Wiedemann 2018;Lancieri 2019;Kathuria 2019). In articles by Becher (2019), Podszun (2019), and Staube (2019) the main issues of FCO decision are discussed after its publication, about selected statements in preliminary assessments provided by FCO see inter alia in articles by Hoppner (2018), Massolo (2018), and Volmar & Helmdach (2018).…”

Leadership of Big Tech Companies in the Data Market: Legal Opportunities and Antitrust Frameworks

“…As noted by researchers, "mixing these two areas would be an unwarranted expansion of the scope of competition law. The purpose of competition law, after all, is not to protect the consumer from data privacy infringements, but to protect the competitive process itself" (Volmar and Helmdach 2018;. It should be noted that this approach is supported not only by European but also by American legal researchers (Ohlhausen and Okuliar 2015;Cooper 2012).…”