Monday 14 October 2019

German regulator launches probe into Facebook

Stock photo: Reuters
Stock photo: Reuters

Douglas Busvine

Germany's competition watchdog expects to take the first steps this year in its probe against Facebook after finding that the social media giant abused its market dominance to gather data on people without their knowledge or consent.

The probe is being closely watched in Europe amid mounting concerns over leaks of data on tens of millions of Facebook users, as well as the extensive use of targeted ads by foreign powers seeking to influence elections in the US.

The Federal Cartel Office objects in particular to how Facebook acquires data on people from third-party apps - including its own WhatsApp and Instagram services - and its online tracking of people who aren't even members.

"We are conscious that this should, and must, go quickly," said cartel office President Andreas Mund, adding he hoped to take "first steps" this year.

In contrast to EU probes into Google that have ended in multibillion-dollar penalties, most recently over the preinstallation of its apps on Android smartphones, the German probe is not expected to end in fines. However, the cartel office could require Facebook to take action to address its concerns if it fails to do so voluntarily.

Facebook responded earlier this year to the cartel office's request for information, and the authority was reviewing whether new features - such as a 'clear history' option announced by CEO Mark Zuckerberg in May - would address its concerns. "We need to establish whether this affects our investigation," Mundt said.

Separately, Mundt confirmed comments he made in an newspaper interview earlier this month that he may launch an investigation into the ecommerce industry under new powers that enable the cartel office to launch sector-wide probes.

The focus would be on so-called 'hybrid' platforms such as US ecommerce giant Amazon that sell their own products and services, but also host third-party traders.

"Our question is: what is the relationship between the platform, which itself is a very powerful trader, and the traders who use the platform?" said Mundt. He added that Amazon was the best-known of the platforms but his interest extended to other players.

The cartel office would not be looking at suspected tax evasion by third-party traders on ecommerce platforms - an issue that Chancellor Angela Merkel's government has vowed to tackle - saying this was a matter for economic policymakers. (Reuters)

Irish Independent

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