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Master thesis

International and European Law – EU Competition Law & Regulation

University of Amsterdam

Faculty of law

The distinction between German national law

and European Union law on the interrelation of

competition law and data protection law

A further analysis of the German Facebook decision on the question

whether competition law can intervene when data protection rules are

violated

29 December 2019

D.W. Dollekamp

10719652

dorinedollekamp@gmail.com

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Abstract

In the current platform economy, personal data is being collected intensively to create targeted advertisements. Besides privacy concerns, competition issues may arise when data is a competitive advantage. Dominant platforms have the power to progressively collect data which might result into an abuse. An example is the decision of the German Bundeskartellamt against Facebook where it claims that Facebook is abusing its dominant position by misusing our personal data. This thesis will further analyse the Facebook case by discussing the distinction between German law and EU law. More specifically, it will analyse the possibility for the European Commission on whether it can assess the Facebook case under Article 102 TFEU. It is discussed that violations in other branches of law can result into an abuse of a dominant position. It is further argued that the Commission should be possible to take data violations into consideration when assessing an abuse of dominant position in order to reinforce the Commission’s aim at fair and transparent competition.

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TABLE OF CONTENTS

Abstract

1. Introduction 4

2. Legal framework: abuse of dominant position in EU law 6

2.1. The decentralization of European competition law 6

2.2. Abuse of dominant position: the classic approach 8

2.3. The platform economy 10

3. Market power of multi-sided platforms 11

3.1.1. Market shares of a platform 11

3.1.2. Economies of scope 12

3.1.3. Network effects 12

3.2. The role of data 14

3.2.1. The definition of data 14

3.2.2. Zero-price markets 15

3.2.3. The protection of personal data 16

4. The German Facebook case 17

4.1. The decision of the Bundeskartellamt 17

4.2. The ruling of the Oberlandesgericht Düsseldorf 20

5. German competition law compared to EU competition law 21

6. Competition law and data protection 22

6.1. Differences and similarities 22

6.2. The Commission’s and CJEU’s approach towards data protection issues in competition law 23

6.3. Competition law vs other branches of law 26

6.4. Article 102(a) TFEU: unfair trading conditions 27

6.4.1. Non-price related concerns 27

6.4.2. The proportionality test 28

6.4.3. The principle of transparency 30

6.4.4. Fairness 31

7. Conclusion 33 Bibliography

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1. Introduction

Over the past few decades digitalisation has been a growing factor in our everyday lives. Data and information became the basis of our interaction in society and economy which has profoundly altered our lives.1 We are able to communicate with everyone around the whole

world, use navigation apps to avoid traffic jams on our way to work and listen to the latest albums of our favourite artists.2 Additionally, digitalisation also changed companies’ business models. Online shopping is increasing and advertising over the internet is becoming more effective than placing an advertisement in the newspaper.3 One of the profiteers from this shift to a digital economy are digital platforms. Companies can advertise their products or services on an online platform where they will reach their consumers. To target a specific group of consumers that a company would like to reach, data of these consumers are being used. Therefore, ‘personal data is the new oil of the internet and the new currency of the digital

market’.4 With the use of personal data, it is becoming easier for companies to reach specific

consumers that are interested in their products or services, which could bring benefits and efficiencies. At the same time, by disclosing all this information about ourselves, privacy and data protection risks arise.5 With the latest Regulation on personal data protection (hereafter: GDPR)6 the European Union (hereafter: EU) is trying to protect our personal data by creating

more rules for companies that want to process personal data. Besides privacy issues there is

‘also fear that the digital sector will naturally favour the growth of hugely influential platforms and ecosystems which will dominate the economy and use their power for their own aims.’7 In

this situation, the digital era will not benefit consumers anymore, but merely the dominant platforms. Therefore, competition policy is needed. According to a “Special Advisers’ Report” to the European Commission ‘This competition policy must be vigorous, disciplined, and

1 Jacques Crémer Yves-Alexandre de Montjoye Heike Schweitzer, Competition policy for the digital era (2019)

p. 12

2 Ibid, p. 12

3 It is acknowledged by the European Commission and the Bundeskartellamt that online advertising provides

better opportunities to address the target groups. See Bundeskartellamt ‘Decision under Section 32(1) German Competition Act (GWB)’ B6-22/16 (2019) para 355 and footnote 358

4 Speech by M. Kuneva – European Consumer Commissioner, Brussels 31 March 2009

5 Preliminary Opinion of the European Data Protection Supervisor, Privacy and competitiveness in the age of big

data: The Interplay between data protection, competition law and consumer protection in the Digital Economy,

March 2014, p. 6

6 Regulation (EU) 2016/679 of the European Parliament and of the Council of April 27, 2016, on the Protection

of Natural Persons with Regard to the Processing of Personal Data and on the Free Movement of Such Data, and Repealing Directive 95/ 46/EC (General Data Protection Regulation), 2016 O.J. (L 119) 1–88 which entered into force on the 25th of May 2018

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coherent. It must rely on solid analysis of the new market settings and of the market failures which will imply that “the invisible hand of the market” must be supplemented by “the visible hand” of competition authorities or of the legislator.’8 This “Special Advisers Report” is an

in-depth report on “Competition policy for the digital era” written by a panel of three special advisers. The report is intended to contribute to the EU Commission’s ongoing deliberations on how competition policy should develop to ensure pro-consumer innovation in digital markets.9 Although the Report is written by independent academics and is not the EU Commission’s official position, it is nevertheless envisaged that the Report will be an important reference point for the EU Commission as it continues to deliberate its approach to competition policy in the digital era.10

The “visible hand” of a competition authority has been shown by the Deutsche Bundeskartellamt (the German Federal Cartel Organisation) in their decision against Facebook claiming that Facebook is abusing its dominant position by misusing our personal data.11

However, after appealing to the Oberlandesgericht Düsseldorf (Court of Düsseldorf), the decision got invalidated. The Oberlandesgericht ruled that there was a violation of data protection rules, not competition rules, and therefore the Bundeskartellamt could not set rules for Facebook on the base of competition law.12 The Bundeskartellamt launched its appeal to

the Bundesgerichtshof (the Federal Supreme Court) during the process of writing this thesis, which was completed at the end of December 2019. At this time, the Bundesgerichtshof’s final ruling on the Facebook case has to be awaited.

The Bundeskartellamt’s view on the interrelation of competition law and data protection law could influence the views for the rest of Europe. Since Facebook is accessible EEA-wide, an investigation from the Commission on the abuse of dominant position based on Article 102 of the Treaty on the Functioning of the European Union (hereafter: TFEU) could potentially have happened as well. Looking at European Competition Law, the question arises whether it would be possible for the Commission to fine Facebook based on data protection violation under EU competition law. This is an interesting and important question, since the application of

8 Ibid, p. 14

9 The report was published on April 4, 2019.

10 K. Fountoukakos and S. Hall, ‘Competition issues in the digital era – EU developments’, Competition Policy

International, February 2019, p. 7

11 Bundeskartellamt, supra note 3

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European competition rules must be consistent.13 If decisions of national competition authorities (hereafter NCAs), that need to follow European competition law, will differ too much from the European Commission or other NCAs, the consistency of EU competition law will be jeopardized.

In this thesis, I will examine the possible outcome of an investigation by the Commission on the abuse of dominant position by Facebook following EU competition law. First, I will set out the legal framework of a dominant position under EU law. Then, I will explain the decision of the Bundeskartellamt and the ruling of the Oberlandesgericht and compare these German national cases with EU competition law. Lastly, I will examine whether EU competition law can be combined with other dimensions of law to establish an abuse of dominant position by analysing previous decisions of the Commission and case law of the European Court of Justice (hereafter: CJEU).

2. Legal framework: abuse of dominant position in EU law

2.1. The decentralization of European competition law

The characteristic of European Competition law is that it is decentralized after the entry into force of Regulation 1/2003.14 This regulation abolished the Commission’s monopoly over

Article 101 and 102 and gave the NCAs of the Member States the power to apply these articles.15 Therefore not only the Commission, but also the NCAs of each Member State enforce European competition law and they act in parallel ways. According to Article 3(1) Regulation 1/2003, an NCA is obliged to apply the EU competition rules when the agreement or conduct is capable of affecting trade between Member States.16 This obligation ensures that European competition law is applied in a consistent way and prevents re-nationalization of competition policies.17 Besides the power for NCAs to apply EU competition law, national courts can apply this as well.18 In order to keep consistency, national courts may not adopt decisions that would

13 Commission Notice on cooperation within the Network of Competition Authorities, O. J. (C 101), 27 April

2004, p. 43-53, para 3

14 Regulation (EC) No 1/2003 of the Council of 16 December 2002 on the implementation of the rules on

competition laid down in Articles 81 and 82 of the Treaty (Text with EEA relevance). OJ L 1, 4.1.2003, p. 1–25

15 Ibid. Article 5 16 Ibid. Article 3(1)

17 C. Gauer, D. Dalheimer, L. Kjolbye and E. de Smijter, ‘Regulation 1/2003: a modernised application of EC

competition rules’, Competition Policy Newsletter No 1, Spring 2003, p. 6

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run counter to a decision of the Commission on the same case.19 Article 15 Regulation 1/2003 also provides the possibility for national courts to ask the Commission its opinion concerning the application of EU competition law.

Since decentralization could lead to inconsistent application of EU law by different national competition authorities, cooperation and coordination is needed in order to maintain common competition policies. Therefore, Article 11(1) Regulation 1/2003 provides that the Commission and the NCAs apply EU competition law in close cooperation. Moreover, a ‘European Competition Network’ was established that provides a framework for the cooperation of competition authorities in cases where Articles 101 and 102 TFEU are applied.20 The Network consists of the European Commission and the NCAs.

As will be discussed later in this thesis, the German Facebook case was based on national law. The Bundeskartellamt mentioned in its decision that there is no equivalent European case law or application practice that it can rely on for their decision.21 Following Article 3(2) Regulation 1/2003 it is not prohibited for Member States to adopt stricter national provisions. The Bundeskartellamt relied on these stricter provisions. However, the national provision that is being used reflects the same scope of application of Article 102 TFEU and is therefore not a stricter provision.22 Thus, the exception of Article 3(2) Regulation 1/2003 is not applicable in

this case.23 The fact that Facebook can affect trade between Member States is self-evident.

Therefore, Article 3(1) Regulation 1/2003 is applicable and the Bundeskartellamt was supposed to apply Article 102 TFEU in the Facebook case.

In their fact sheet, the Bundeskartellamt even stated that a case such as the Facebook case would generally also be possible under the relevant norm of Article 102 TFEU.24 The fact that there is no equivalent European case law or application that it can rely on for their decision does not give a free pass to disregard European law in its entirety. In this situation, the Bundeskartellamt should have applied EU competition law.

19 Ibid. Article 16

20 Commission Notice, supra note 13, para 1 21 Bundeskartellamt, supra note 3, para 914

22 More will be discussed in Chapter 5 of this thesis.

23 M. Botta and K. Wiedemann, ‘The Interaction of EU Competition, Consumer, and Data Protection Law in the

Digital Economy: The Regulatory Dilemma in the Facebook Odyssey’, The Antitrust Bulletin (2019), Vol. 64(3), p. 441

24 Bundeskartellamt, Bundeskartellamt prohibits Facebook from combining user data from different sources

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Basing this decision on national provisions instead of EU provisions has consequences for the Oberlandesgericht as well as the European Court of justice (hereafter: the Court), because it eliminates the possibility for a preliminary ruling following article 267 TFEU. By applying national law, where it should have applied European law, the Bundeskartellamt prevents the Court from ruling on the matter. This conflicts with the principle of sincere cooperation laid down in article 4(3) TEU. Another relevant point is that the Oberlandesgericht is referring to ‘the desired alignment of national competition law with that of the Union’,25 but still only

discusses German law. This can also be seen an indicator that EU law should have been used.

Altogether, according to Article 3(1) Regulation 1/2003, the Bundeskartellamt should have applied Article 102 TFEU. Only when EU law is not applicable, it could have applied national provision that might be stricter based on Article 3(2) Regulation 1/2003. Following Article 11(5) Regulation 1/2003, the Bundeskartellamt should have consulted the Commission on the matter. The fact sheet of the Facebook case does indeed confirm that the Bundeskartellamt has consulted the Commission. 26 However, the opinion of the Commission on the matter and the question why the Bundeskartellamt did not apply EU law stays rather vague and not properly substantiated. It is therefore relevant to examine a possible outcome of the Commission in the matter, given the need for consistent application of EU law. When national decisions, based on EU law, would differ too much from the Commission’s decisions, this consistency could be jeopardized. Before examining this outcome, it is necessary to discuss the notion of abuse of dominant position following EU competition law.

2.2. Abuse of dominant position: the classic approach

The prohibition on the abuse of a dominant position is laid down in Article 102 TFEU and is only applicable when an undertaking has a dominant position or where two or more undertakings are collectively dominant.27 The term “dominant position” is explained by the CJEU in United Brands v Commission where it held that ‘the dominant position referred to in

[article 102 TFEU] relates to a position of economic strength enjoyed by an undertaking which enables it to prevent effective competition being maintained on the relevant market by giving it

25 Oberlandesgericht, supra note 12, p. 8 26 Bundeskartellamt, supra note 24, p. 6

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the power to behave to an appreciable extent independently of its competitors, customers and ultimately of its consumers.’28 This has been further explained in the “Guidance on the

Commission's enforcement priorities in applying Article [102 TFEU] to abusive exclusionary conduct by dominant undertakings” (hereafter: the Guidance).29 In Continental Can v Commission the CJEU held that for the finding of a dominant position, the establishment of the

relevant market is a necessary precondition.30 The classic economic model for defining the relevant market is the so-called SSNIP test (Small but Significant Non-Transitory Increase in Price test). This model assesses whether customers would switch to other readily available substitute products or to suppliers located elsewhere in response to a hypothetical small (5-10%) but permanent increase in price of the product in question.31

A simple example is the relevant market for bananas. If a price increase of bananas will result in a shift of consumers from buying other fruits instead of bananas, then these other fruits will form part of the relevant market. However, when consumers will keep buying bananas, even when the price increases (because bananas are eaten more easily than for example apples), then the relevant market consists of only bananas.32

After establishing the relevant market, it needs to be determined whether there is a dominant position in that market. This derives out of several factors which are set out in the Guidance. Although market shares are a useful first indication, the position of actual and potential competitors need to be taken in consideration as well. Another factor can be the countervailing buyer power of customers.33

Article 102 TFEU does not necessarily prohibit having a dominant position; what is prohibited is the abuse of a dominant position.34 According to Michelin v Commission35 a dominant company has a ‘special responsibility not to allow its conduct to impair undistorted

28 Case C-27/76 United Brands Company and United Brands Continentaal BV v Commission of the European

Communities [1978] ECLI:EU:C:1978:22, para 65

29 Communication from the Commission ‘Guidance on the Commission's enforcement priorities in applying

Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings’ (2009/C 45/02)

30 Case 6/72 Continental Can v Commission [1973] EU:C:1973:22, para 32; Wish, supra note 27, p. 188 31 OECD, Roundtable on Market Definition DAF/COMP/WD(2012)28, 31 May 2012, para 9

32 This interchangeability question can be seen in the United Brands case as well. See supra note 28, p. 12 et seq. 33 Guidance, supra note 29, para 12

34 Wish, supra note 27, p. 198

35 Case C-322/81 NV Nederlandsche Banden-Industrie Michelin v Commission of the European Communities

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competition on the internal market’.36 This is a general responsibility. In the situation of

digital platforms, their responsibility is, that they use their power in a pro-competitive manner. This is also important because platforms have a certain regulatory power since they determine the rules according to which their users interact and have the power to decide what content is allowed and what is not.37

A classic example of the abuse of a dominant position is predatory pricing where a dominant company ‘sets its prices so low for a sufficient period of time that its competitors leave the

market and others are deterred from entering’.38 An abuse of a dominant position can be easily

established in this example. According to the “Special Advisers Report”, ‘the basic framework

of competition law, as embedded in Articles 101 and 102 of the TFEU, continues to provide a sound and sufficiently flexible basis for protecting competition in the digital era’.39 However, in my opinion, it is more difficult to establish a dominant position of a platform under this framework and it could be questioned whether this framework is still sufficient enough for the current digital era. This will be further discussed in the next paragraphs.

2.3. The platform economy

The application of big data, new algorithms, and cloud computing is changing our economy. With the structures created by online platforms such as Amazon, Facebook, Google and Uber a digital platform economy is emerging.40

Platform markets are two-sided or multi-sided. The definition of two-sided platforms refers to a situation where two distinct user groups interact with each other through a common platform and the value of joining the platform depends on their expectations about the network size. 41 An example of a two-sided market is the credit card industry, where the number of cardholders depend on the number of merchants and vice versa. A multi-sided platform is essentially the same as a two-sided platform, it only has more than two sides. Facebook is a multi-sided

36 Ibid. para 57

37 Crémer, supra note 1, p. 16; The power to decide what content is allowed and what is not is slightly nuanced

after the new Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC, since article 17 oblige platforms to remove information that is violating copyrighted works

38 OECD, Predatory pricing (1989), p. 2 39 Crémer, supra note 1, p. 39

40 M. Kenney, J. Zysman, ‘The Rise of the Platform Economy’ Issues in science and technology (2016) 41 OECD Roundtable on two-sided markets DAF/COMP/WD(2009)69, 28 May 2009, p. 3

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platform. For a user, it is more attractive to be on the platform, when more of his or her friends are using it. These sides therefore depend on each other. Another side is the advertisement side, where the attraction for advertisers to use Facebook depends on the amount of users Facebook has.

To establish whether platforms have a dominant position a few complications arise. One of the complications is the use of the SSNIP test. In case of a two-sided or multi-sided platform the SSNIP test in respect of market definition cannot be usefully applied, since an increase in the price on one side of the platform has implications for the demand on the other side of the platform. This can lead to a market being defined too narrowly.42 Therefore, the OECD stated that ‘[the SSNIP test] is … probably more useful as a loose conceptual guide than as a precise

tool that courts and competition authorities should actually attempt to apply’.43 The

Bundeskartellamt agreed with this statement and did not use the SSNIP test in the Facebook case to establish the relevant market.44 See Chapter 4.1 for more information on how it did

establish the dominant position of Facebook.

Besides the complication of establishing the relevant market, defining market power of a platform can be difficult because of the different indication of market shares. Further, platforms have different network effects and economies of scope platforms in comparison with other (non-digital) companies. These difficulties will be further discussed in the next chapter.

3. Market power of multi-sided platforms

3.1.1. Market shares of a platform

As already mentioned above, to establish market power, market shares of a company are usually a useful first indicator. However, in the case of multi-sided platforms, a few complications arise. A first complication is the measurement of the market shares. It is not always clear how shares

42 OECD, supra note 31, para 26 43 Crémer, supra note 1, p. 45

44 In their decision, the Bundeskartellamt said that ‘The fact that the SSNIP test as a methodological

characteristic of the demand-side oriented market concept, which is only rarely applicable in practice anyway, does not apply to free services does not make the demand-side oriented market concept inapplicable. As a matter of fact, the factors of time and temporal intensity of use are product characteristics, especially when it comes to social media, and thus have to be considered when defining the market.’ See Bundeskartellamt, supra note 3,

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should be computed to take account of the multi-sidedness of the market.45 Another problem arises when one side does not pay for the platform.46 Value shares on both sides will then not

be possible to compute.47 Besides complications concerning the measurement, these platform

markets ‘are a nascent and dynamic sector and market shares can change quickly within a

short period of time.’48 Therefore, market shares ‘only provide a limited indication of competitive strength.’49 Consequently, to establish market power, it is necessary to look at other factors. One factor that strengthens market power is the notion of economies of scope, which will be discussed below.

3.1.2. Economies of scope

Platforms benefit from very strong “returns to scale”. Once the platform is created, information can be transmitted to many people at a very low cost. For example, since Google Maps has been developed, it can serve users for an adequate low cost and the costs will rise much more slowly than the number of users.50 According to the “Special Advisers’ Report”, ‘competition

between two firms producing the same product will not allow them to cover their costs. Indeed, were they to cover their (total) costs, they would have to price above the cost of serving an additional consumer (the marginal cost) and each of them would find it profitable to lower their price to steal the other’s clients. As a consequence, no company, unless armed with a much superior and cheaper technology, would want to enter a market dominated by an incumbent, even when this incumbent is making large profits.’51 Besides companies not wanting to enter

the market, users usually remain at the same platform as an outcome of network effects.

3.1.3. Network effects

The term network effect can be described as a situation where the benefit of one side of the market depends on the number of customers on the other side of the market, and vice versa. For

45 OECD, Measuring Market Power in Multi-Sided Markets, DAF/COMP/WD(2017)35/FINAL, 14 November

2017, para 23

46 According to the Bundeskartellamt, this market side of the platform still satisfy a certain economic demand,

namely users’ time and their attention. Therefore, users remain a customer. To determine the relevant market, competition law looks at the demand of the opposite market side and their willingness to pay for the users’ time and attention. See Bundeskartellamt, supra note 3, para 246

47 OECD, supra note 45, para 24

48 Case COMP/M.6281 Microsoft/Skype C [2011] 7239, para. 78 49 Ibid. para. 78

50 Crémer, supra note 1, p. 20 51 Ibid. p. 20

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example, when more companies join a platform, more consumers will find that platform more attractive and therefore more consumers will join. A social network is mainly characterised by this direct network effect. As is relevant for the Facebook case, ‘the more private users are

active on Facebook, the higher the benefits for this user group as the options for users to interact and find friends and acquaintances increase with an increasing number of users in the social network’.52

Platforms can also benefit from indirect network effects, where the benefit for users in one group depends on the number of users from another group.53 Facebook is a platform with users on one side of the platform and advertisers on the other side. Hence, the more users active on Facebook, the more advertisers are interested in the platform. 54

Network effects make large platforms more efficient than smaller ones.55 It is therefore important for new companies to reach a critical mass quickly when entering the market which will enable them to benefit from network effects that create or increase their networks’ benefit.56 Moreover, as already stated above, once a large platform is established, users will presumably stay at that platform, since the move to a new platform would only be useful if all the users would move to the new platform.57 Consequently, this leads to a ‘winner takes all’ outcome.58

This can be seen in the Facebook case, where the Bundeskartellamt claims that Facebook is benefitting from a strong lock-in effect; users will remain using Facebook, since their friends are using it. Only when their friends would switch, they would do so as well.59

Besides the unwillingness of users not wanting to switch to other platforms, new users would choose the biggest platform to benefit from the network effects as well. In order to attract new users to benefit from network effects, the content on platforms are usually ‘free’.60 As already

mentioned above, to still make a profit out of maintaining the platform, advertisement is being used. Facebook is using this business model as well. You can create a user profile for free and

52 Bundeskartellamt, supra note 3, para 218 53 Ibid. para 220

54 OECD, supra note 45, para 5 55 Crémer, supra note 1, p. 22

56 Case COMP/M.8124 Microsoft/LinkedIn C [2016] 8404, para 346-347 57 Crémer, supra note 1, p. 22

58 OECD, The Digital Economy, DAF/COMP(2012)22, 7 February 2013, p. 5 59 Bundeskartellamt, supra note 3, para 276

60 Most platforms are for free since users ‘tend to be unwilling to pay for the services’. This has been established

in a survey held by the Bundeskartellamt in the Facebook investigation. See Bundeskartellamt, supra note 3, para 270

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on the start page called “newsfeed” advertisements are being shown.61 In order to reach the

correct group of consumers, Facebook is using a targeted advertisement model, where it uses personal data to create personalized advertisements.62 As a result, access to your personal data

can be seen as a way of “paying” for the platform.63 This data is becoming more important for

platforms. The role of data will be discussed in the next paragraph.

3.2. The role of data

3.2.1. The definition of data

There is no single definition for the term “data”. In a joint paper of the Autorité de la Concurrence and the Bundeskartellamt it is described as ‘(any) information, or to the

representation of such information, often in combination with it being stored on a computer.’64

Data can provide different types of information about individuals, economic entities or objects, where the current discussion concerning data and competition law focuses mostly on personal data. This term is defined in the GDPR as ‘any information relating to an identified or

identifiable natural person (‘data subject’); an identifiable natural person is one who can be identified, directly or indirectly, in particular by reference to an identifier such as a name, an identification number, location data, an online identifier or to one or more factors specific to the physical, physiological, genetic, mental, economic, cultural or social identity of that natural person’65

Personal data is an essential source of information for any company in order to improve its products to the needs of its customers, offer personalized services, and use targeted advertisements.66 Data is usually a non-rival good, since the use of data by one company, does not prevent competitors in using the same data as well.67 Therefore, competition law is usually not involved in data related issues. In the Telefonica UK/Vodafone UK/Everything Everywhere decision, the Commission mentioned that ‘customers generally tend to give their personal data

to many market players, which gather and market it. Therefore, this type of data is generally

61 Bundeskartellamt, supra note 3, para 21-25 62 Ibid. para 214

63 Crémer, supra note 1, p. 22

64 Autorité de la Concurrence & Bundeskartellamt, ‘Competition Law and Data’, 2016, p. 4 65 GDPR, supra note 6, Article 4(1)

66 Autorité de la Concurrence & Bundeskartellamt, supra note 64, p. 9 67 Ibid. p. 36

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understood to be a commodity’.68 If certain personal data is widely available, no company, even a dominant one, would benefit from a competitive advantage, since everyone is able to get the same information and data.69 Besides, competition law is usually not involved in data

processing issues, since the increasing quantities of data can improve products and services, and therefore increase consumer welfare.70 Only if data provides a competitive advantage for

one company, competition issues may arise.

In the case of platforms, users tend to be unwilling to pay for the services provided.71 The non-paying side is subsidized by profits made on another side of the platform, namely advertisements, by selling the attention of the users. As already mentioned above, to use the free service, users are providing personal data to the platform, which the platform uses to reach different audiences for different advertisements. Since this is a form of ‘exchange’ it is recognized that this zero-price side of a platform can also be part of a market.72 In zero-price

markets, such as Facebook, personal data is being used in several ways.

3.2.2. Zero-price markets?

Facebook claims that personal data is being used to provide a better service.73 This is shown by

the personalised content in the News Feed, which is a ‘personalised stream of content and

activities relating to the user’.74 All posts are ranked by an algorithm which calculates the

relevance for each post on the basis of collected personal data.75 However, the main reason for

collecting data is to provide targeted advertising.

Facebook is benefiting from network effects when processing data. Direct network effects arise by the massive collection and processing of data. The more data Facebook can process, the more precisely it can tailor its service and therefore attract more users.76 This is relevant for the users’ news feed and the content on it. Indirect network effects arise since Facebook can offer

68 Case COMP/M.6314, Telefonica UK/Vodafone UK/Everything Everywhere, 4 September 2012, para 543 69 Autorité de la Concurrence & Bundeskartellamt, supra note 64, p. 36

70 G. Colangelo & M. Maggiolino, Data Accumulation and the Privacy- Antitrust Interface: Insights from the

Facebook case for the EU and the U.S., Stanford- Vienna TTLF Working Paper No. 31, p. 2

71 Bundeskartellamt, supra note 3, para 270 72 Crémer, supra note 1, p. 44

73 See Facebook’s data policy. Available at https://www.facebook.com/full_data_use_policy 74 Bundeskartellamt, supra note 3, para 489

75 Ibid. para 489

76 G. Schneider, ‘Testing Art. 102 TFEU in the Digital Marketplace: Insights from the Bundeskartellamt’s

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more tailored advertisement spots with the collected data and therefore attract more advertisers.77 These network effects also trigger economies of scope. The more data is collected,

the easier and less costly it becomes for Facebook to produce new data.78

According to the Bundeskartellamt, Facebook’s data sources are highly relevant for competition because the product of a social network is driven by personal data and, in particular, the algorithms used for interaction ultimately define the product as a provision of personal data to the users. Facebook will always be keen to collect as much data as possible in order to keep their business model running.79 ‘Superior access to these data makes it possible to continuously

adapt the products by further technical developments and improved personalisation and to achieve other strategic business goals. Data sources also secure funding through advertising which, if based on these data, can be precisely targeted and continuously refined. In turn, advertising generates new user data.’80 Therefore, access to personal data is a major market

dominance factor and must to be taken in consideration when assessing a company’s position in the market.81

3.2.3. The protection of personal data

As mentioned in the introduction, personal data is protected under EU law. Data protection is a fundamental right under Article 8 of the Charter of Fundamental Rights of the European Union.82 Personal data protection has further increased after the entry into force of the GDPR.83

Since Facebook is processing personal data, it is responsible for ensuring compliance with the provisions given under the GDPR and the rights afforded to the data subjects (i.e. users).84

77 Ibid. p. 218 78 Ibid. p. 218

79 Bundeskartellamt, supra note 3, para 888 80 Ibid. para 488

81 Ibid. para 888

82 Article 8 of the Charter states: (1) ‘Everyone has the right to the protection of personal data concerning him or

her’. (2) ‘Such data must be processed fairly for specified purposes and on the basis of the consent of the person concerned or some other legitimate basis laid down by law. Everyone has the right of access to data which has been collected concerning him or her, and the right to have it rectified’. (3) ‘Compliance with these rules shall be subject to control by an independent authority. See Charter of Fundamental Rights of the European Union (2012/C 326/02)

83 Botta, supra note 23, p. 429

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At first instance, the processing of personal data is prohibited, unless there is a legal basis on the grounds of Article 6(1) GDPR.85 A widely relied-on legal basis is the notion of consent

given by the data subject, which is laid down in Article 6(1)(a) GDPR. According to Article 4(11) GDPR consent means ‘any freely given, specific, informed and unambiguous indication

of the data subject's wishes by which he or she, by a statement or by a clear affirmative action, signifies agreement to the processing of personal data relating to him or her’. Article 7 GDPR

and recitals 32, 33, 42, and 43 GDPR further elaborate the conditions for a valid consent. The requirements of the GDPR make clear ‘that data subjects should have full knowledge and

control over what is happening to their personal data when granting consent.’86

Besides a legal basis, the way personal data is being processed needs to be in accordance with Article 5 of the GDPR, which gives several principles, such as fairness and transparency in processing personal data and that the processing is limited to what is necessary in relation to the purposes for which they are processed.87

Infringements of the GDPR can result into legal proceedings imposed by national supervisory authorities.88 However, what happens if a dominant company violates data protection rules and therefore benefit more from network effects? Can a competition authority intervene in such a situation?

4. The German Facebook case

4.1. The decision of the Bundeskartellamt

85 Article 6 of the GDPR gives six justifications of processing data, namely (a) consent, (b) the processing is

necessary for the performance of a contract to which the data subject is party or in order to take steps at the request of the data subject prior to entering into a contract, (c) the processing is necessary for compliance with a legal obligation to which the controller is subject, (d) the processing is necessary in order to protect the vital interests of the data subject or of another natural person, (e) the processing is necessary for the performance of a task carried out in the public interest or in the exercise of official authority vested in the controller or (f) the processing is necessary for the purposes of the legitimate interests pursued by the controller or by a third party, except where such interests are overridden by the interests or fundamental rights and freedoms of the data subject which require protection of personal data, in particular where the data subject is a child.

86 Botta, supra note 23, p. 431

87 Other principles are purpose limitation, accuracy, storage limitation, integrity and confidentiality. See GDPR,

supra note 6, Article 5.

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The interrelation between competition law and data protection law is clearly shown by the decision of the German Bundeskartellamt where it ruled that Facebook is abusing its dominant position based on violations of data protection law.

Facebook is mostly known for its core product, which is its social network, where users can create a personal page and connect with friends who also use the network.89 Besides the social network, Facebook offers other digital services under other names and other apps. The ‘Facebook Group’ consists of Facebook itself, Instagram, WhatsApp, Masquerade Technologies, Facebook Technologies, Onavo Protect, Crowd Tangle and Moves.90 All these services are for free. To fund its social network, Facebook is using online advertising. Advertising customers can specify their advertising objectives and audience to achieve the best results and reach a specific audience.91 That audience is refined by personal data that users upload to Facebook (for example, education, home town, relationship) and the location of users is being used as well.92 In the privacy policies of all the Facebook owned companies it is stated

that they process users’ data ‘to provide an innovative, relevant, consistent and safe experience

across all Facebook Company Products’.93

Besides the processing of data through the digital services Facebook provides, data is also collected through Facebook Business Tools: it gives Facebook a direct connection to users’ data when they go to other websites or apps through Facebook, or when they use their Facebook account to register for other websites.94

After excluding other social networks – such as Snapchat and Instagram – from the relevant competitive environment95 and the distinction in different advertising markets for the relevant product market,96, the Bundeskartellamt established that Facebook is a dominant company in

89 Bundeskartellamt, supra note 3, para 15 et seq.

90 For explanations of the companies and its services, see Bundeskartellamt, supra note 3, para 1-13 91 Ibid. para 38-39

92 Ibid. para 44-45 93 Ibid. para 126 94 Ibid. para 139-150

95 The Bundeskartellamt excludes professional networks from the relevant market for social services since they

cannot be considered as substitutes. The Facebook services Messaging, Snapchat and Instagram are excluded as well. Networks as YouTube, Twitter and Pinterest and several other services such as microblogging cannot be included in the relevant market either. See for more information Bundeskartellamt, supra note 3, para 277-339.

96 The Bundeskartellamt makes a distinction between online and offline advertising, and search and non-search

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the national market for social networks for private users.97 This decision was based on the near monopolistic market share position and the strong direct network effects of Facebook’s business model, which creates a situation where switching to another social network would be unlikely.98

The Bundeskartellamt claims, that due to Facebook’s market power, users cannot avoid the processing of their personal data and this is not sufficiently controlled by competition.99 Facebook is using abusive business terms ‘by creating conditions which make the use of the

social network conditional on Facebook being able to gather user-related and device-related data that were gathered and saved during the use of [the other services Facebook provides] as well as user-related and device-related data on Facebook Business Tools, and combine them without the users’ consent with those data that were gathered and saved during their use of Facebook.com’.100

This is based on the grounds that these exploitative business terms are in violation with the principles of the GDPR and that this can be examined under competition law.101 It claims that application of data protection law through competition law promotes consistency and competition law is applicable in the enforcement of data protection rules.102

According to the Bundeskartellamt, users do not give consent to the processing of data collected from Facebook-owned services and Facebook Business Tools, or to the Terms of Service which users are required to accept in order to be able to use the social network, since the dominant position of Facebook takes the free choice of users away because they would no longer be able to fulfil their need to participate in the social network.103 Ineffective consent can constitute in a

97 Ibid. para 374

98 Facebook has a great market share that has been exceeded by 90% since 2012, with an upward trend and

therefore the Bundeskartellamt concludes that Facebook has an almost monopolistic market share position. Besides a great market share, Facebook is benefiting from direct network effects that create a significant market entry barrier for new platforms and high barriers for switching to another network as users. This lock-in effect will likely result in a Facebook becoming a monopolist. The indirect network effects create a problem of substitutability in the advertising side of the platform: Facebook has access to a large number of different data sources and switching to another platform would therefore be unlikely. See for more information and arguments Bundeskartellamt, supra note 3, para 413-481.

99 Ibid. para 384-386 100 Ibid. para 522 101 Ibid. para 534 102 Ibid. para 541-547 103 Ibid. para 646

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breach of data protection law under the GDPR when there are no other justifications.104 Due to the unlawfulness of processing data, Facebook can also make attractive offers to third-party operators in the form of targeted advertising tailored specifically to their users.105 This results

in an exclusionary abuse.

Altogether, Facebook is violating data protection rules as a result of market power. Facebook’s terms and conditions violate the legal principles of data protection laws and is an inappropriate condition under the legal principles of provisions on unfair contract terms, which constitutes an abuse of a dominant position.106 The Bundeskartellamt prohibited the data processing provided for in the Terms of Use and the collection of user- and device-related data from the other Group-owned services and the Facebook Business Tools and their combination with Facebook-data for the purposes of the social network without the consent of the users. In addition, Facebook needed to adapt the conditions of use in accordance with the GDPR within 12 months. An implementation plan for the adaption needed to be handed in within four months.107 After the

decision, Facebook appealed to the Oberlandesgericht Düsseldorf.

4.2. The ruling of the Oberlandesgericht Düsseldorf

The ruling of the Oberlandesgericht did not turn out well for the Bundeskartellamt. The Bundeskartellamt needed over 270 pages to establish an abuse of dominant position. In only 37 pages this decision was overruled. According to the Oberlandesgericht, ‘the data processing by

Facebook which it complained about does not give rise to any relevant competitive damage or any undesirable development in competition’.108 Since data can be duplicated, the use of data does not weaken the consumer economically.109 The Oberlandesgericht claimed that the Bundeskartellamt did not explain which terms of use would have been formed under circumstances of competition and concluded that there was no exploitative abuse to the detriment of Facebook users.110 The prohibition on not using data from the other services Facebook provides is far-reaching and can only be justified if all the additional data mentioned without exception fall under excessive abuse. This is not the case. The Bundeskartellamt sees

104 See paragraph 3.2.3. for more information. 105 Bundeskartellamt, supra note 3, para 886 106 Ibid. para 532

107 Oberlandesgericht, supra note 12, p. 4 108 Ibid. p. 7

109 Ibid. p. 9 110 Ibid. p. 7

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the damage of the abuse as a “loss of control” and right to informational self-determination. According to the Oberlandesgericht, Facebook users balance the advantages resulting from the use of a free social network with the processing of data and therefore they “control” their use of data by allowing Facebook to use it.111 The Bundeskartellamt established a problem that was

merely based on data protection concerns and not on competition concerns.112 The remedy the

Bundeskartellamt proposes is also unsuitable, since it merely obliges the consent to process data, not the processing of data itself. This interferes with Facebook’s rights in a disproportionate manner and is therefore unlawful.113 An appeal has been lodged to the Bundesgerichtshof and their ruling has to be awaited.114

5. German competition law compared to EU competition law

The decision of the Bundeskartellamt was based on German Case Law and on Article 19 of the Act against Restraints of Competition (hereafter: ARC), which resembles Article 102 TFEU. In its decision, the Bundeskartellamt noted that there was no European case law or application practice that was equivalent to the current Facebook case.115 As already discussed in chapter 2, this is not a reason to only apply German competition law. Therefore, the question arises whether the Commission could investigate and conclude data protection violations as an abuse of dominant position under European Competition Law. In order to establish this, it is first necessary to briefly discuss the differences between German and European Competition law.

The main requirements are equivalent to European Competition Law: a company needs to have a dominant position and it is abusing this conduct.116 In 2016, a new criteria, under article 18(3)(a) of the ARC, was added to establish a dominant position in the case of multi-sided markets, such as the importance of network effects and companies’ access to data.117 This

111 Ibid. p. 9-10 112 Ibid. p. 11 113 Ibid. p. 32

114 See the tweet of the Bundeskartellamt on August 26th 2019 saying that it will appeal to the Bundesgerichtshof

https://twitter.com/Kartellamt/status/1165993095890124800

115 Bundeskartellamt, supra note 3, para 914

116 Article 18 and 19 of the Act against Restraints of Competition.

117 M. Volmar & K. Helmdach ‘Protecting consumers and their data through competition law? Rethinking abuse

of dominance in light of the Federal Cartel Office’s Facebook investigation’, European Competition Journal, (2018) 14:2-3, p. 197

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makes it easier to establish a dominant position, but this does not answer the question whether there is an abusive conduct.118

As already mentioned, the Bundeskartellamt did not refer to European case law, since there are none. It does refer to the Pechstein case, where the Bundesgerichtshof ruled that Article 19 ARC needs to be applied in cases where constitutional protected rights can be restricted by one contractual party, when a dominant company is so powerful that it would be able to dictate contractual terms and therefore eliminating the other party’s contractual autonomy.119 The Bundeskartellamt also refers to the VBL-Gegenwert judgments120 where the Bundesgerichtshof held that a breach of a rule from other legal areas can constitute in a finding of abuse.121 However, in this case there was a breach of consumer protection, not data protection. The Facebook decision and ruling were the first cases where this is discussed. Neither the European Commission investigated this matter, nor did the CJEU ever rule over such a situation. Whether this is possible, the interrelation between competition law and data protection needs to be discussed.122

6. Competition law and data protection

6.1. Differences and similarities

The aim of both competition and data protection policies is the protection of individuals’

118 It should be noted that the Bundeskartellamt cannot formally base its decision on the new criteria, since the

new Article has been enacted after the launch of the investigation. However, it can nonetheless interpretatively refer to these parameters, which were already widely acknowledged in the authority’s working papers of the Bundeskartellamt. See Schneider, supra note 76, p. 215; Bundeskartellamt, ‘Working Paper- Market Power of Platforms and Networks- Executive Summary’, June 2016

119 Bundeskartellamt, supra note 3, para 527; Bundesgerichtshof, 7 June 2016, file KZR 6/15,

Pechstein/International Skating Union, para 48

120 Bundesgerichtshof, 6 November 2013, case no KZR 58/11, VBL-Gegenwert I; Bundesgerichtshof, 24 January

2017, case KZR 47/14, VBL-Gegenwert II; Volmar, supra note 113, footnote 13

121 Bundesgerichtshof, 6 November 2013, case KZR 58/11, VBL-Gegenwert I para 65; Bundesgerichtshof, 24

January 2017, case KZR 47/14, VBL-Gegenwert II para 35; Volmar, supra note 113, footnote 14

122 For the length of this thesis, I will not investigate the establishment of a dominant position of Facebook

EEA-wide. Seen the fact that the dominant position in Germany was not contested by the Oberlandesgericht, and Facebook is a widely known and used platform with cross-border aspects, I will presume that Facebook has a dominant position (see Oberlandesgericht, supra note 12, p. 6). For the relevant geographic market, the Bundeskartellamt defined it only Germany-wide, based on the fact that the platform was found to be used predominantly to connect with other users in its own country (see Bundeskartellamt, supra note 3, para 344-347). However, the European Commission established the geographic market for social networking services as EEA-wide ‘in line with a more conservative approach’ (see Case COMP/M.7217 Facebook/WhatsApp C [2014] 7239). Therefore, the European Commission could presumably investigate the dominant position of Facebook EEA-wide.

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welfare within the internal market.123 However, these policies differ from each other in goals, scopes of application, and enforcement regimes. While competition law aims at protecting consumers by safeguarding undistorted competition, data protection law safeguards consumers’ welfare by protecting their personal data.124 Both policies are similar in aims, but the differences

show that they cannot replace each other and they coexist in a parallel way.125 Consequently, it

cannot be concluded that competition law is consistently precluded in data protection issues. It should not pursue data protection goals, but ‘competition law enforcers should have the

discretion to intervene in case of market failures in the data economy, even in the presence of overlapping data protection and consumer law applicability’.126 For example, data protection

can serve as an element when conducting a legal assessment under competition law.127 Despite the ongoing debate on whether competition law is the right instrument in data protection issues128, it can be established that they do not exclude each other.

6.2. The Commission’s and CJEU’s approach towards data protection issues in competition law

The position of the German Bundeskartellamt concerning data protection law and competition law was already shown by the joint position paper by the French and German antitrust authorities, that stated that privacy policies should be assessed under competition law ‘whenever these policies are liable to affect competition, notably when they are implemented

by a dominant undertaking for which data serves as a main input of its products or services’129

The view of the Bundeskartellamt is also shown in other documents such as a ‘Working Paper on Market Power of Platforms and Networks’130 and the contribution of Germany to the OECDs joint meeting between the Competition Committee and the Committee on Consumer Policy on

123 Costa-Cabral, Francisco and Lynskey, Orla ‘Family ties: the intersection between data protection and

competition in EU Law’. Common Market Law Review, 54 (1). ISSN 0165-0750 (2017), p. 21–22

124 Botta, supra note 23, p. 434 125 Ibid. p. 436

126 Ibid. p. 437

127 Autorité de la Concurrence & Bundeskartellamt, supra note 64, p. 23

128 See for example Colangelo, supra note 70, p. 44 that states that ‘it is apparent that the appropriate way to

handle the Facebook case would be to conclude that its conduct amounts to an unfair commercial practice. An unfair practice procedure would ensure the same outcome in terms of the remedy, without having to overcome the hurdles of an antitrust investigation’ and Botta, supra note 23, p. 445 who suggests that ‘public enforcers with double competence should opt for the legal regime that provides the most deterrent remedy in the case given’ where competition law is usually able in giving higher fines and better remedies, such as behavioural

commitments, this regime should be taken in consideration despite easier regimes such as data protection law

129 Autorité de la Concurrence & Bundeskartellamt, supra note 64, p. 29 130 Bundeskartellamt, supra note 118

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quality considerations in the zero-price economy.131 Therefore, an investigation of the Bundeskartellamt on the matter of abusive conduct relating to data protection concerns is not very surprising. The European Commission and the CJEU, on the other hand, both take the position in keeping both policies apart.

In the Asnef- Equifax judgment, the CJEU ruled that ‘any possible issues relating to the

sensitivity of personal data are not, as such, a matter for competition law, they may be resolved on the basis of the relevant provisions governing data protection’.132

In a speech of Commissioner Vestager, she said that she personally does not think that competition law should be used to advance data protection.133 This was already mentioned in the Google/Sanofi/DMI JV decision, where the Commission considered that any privacy related concerns did not fall within scope of competition law.134 Also in the recent Facebook/WhatsApp merger decision, the Commission argued that data protection concerns do not fall within the scope of European Competition Law.135 The reason is that competition law has its purpose to protect against restraints of competition and abusive behaviour. If it would also support enforcement of other legal norms, then competition law would compensate for deficiencies in other laws.136 Questions of competence could also arise then.137 Although the Commission

considered in the Microsoft/LinkedIn merger decision that ‘privacy related concerns as such

do not fall within the scope of EU competition law but can be taken into account in the competition assessment to the extent that consumers see it as a significant factor of quality, and the merging parties compete with each other on this factor’138, it also stated that ‘the integration between the parties’ datasets was to be governed only by applicable data protection rules’.139

Data protection is therefore only relevant insofar as it is a parameter in the competitive

131 OECD, Quality considerations in digital zero-price markets, DAF/COMP(2018)14, 9 October 2018 132 Case C-238/05 Asnef-Equifax (2006) ECR I-11125, para 63 ECLI:EU:C:2006:734

133 DLD 16 in Munich, 17 January 2016, Competition in a big data world 134 M.7813 SANOFI / GOOGLE / DMI JV, 23 February 2012, para 45 135 Facebook/WhatsApp, supra note 122, para 164

136 P. Stauber, ‘Facebook’s abuse investigation in Germany and some thoughts on cooperation between antitrust

and data protection authorities, Competition Policy International, February 2019 p. 6

137 This issue can be seen in the Facebook case as well. The Bundeskartellamt is does not have competence to

adopt administrative decision to sanction unfair commercial practices, since it falls under the scope of the Unfair Competition Act, which is a matter of civil law. This could be a reason why the Bundeskartellamt decided to place the Facebook case under competition law. This can be seen as compensating for deficiencies in other laws, which is exactly a reason not to intervene (see for more information Botta, supra note 23, p. 440).

138 Microsoft/LinkedIn, supra note 56, paras 177-178 139 Ibid. paras 177-178

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process.140 This can also be seen in the Apple/Shazam merger decision, where the Commission investigated if the addition of Shazam User Data would allow Apple to materially improve its services.141

In other merger cases, the Commission considered the processing of data as an efficiency instead of a risk for competition. In the Google/DoubleClick decision, it is held that ‘as opposed

to offline advertising, online advertising is considered to be capable of reaching a more targeted audience in a more effective way. Advertisers can precisely target their audience by combining information regarding geographical location, time of day, areas of interest, previous purchasing record of the user and search preferences’142 This was further explained in the

Microsoft/Yahoo! Decision, where the Commission considered that ‘it is plausible that the merged entity through innovation and through its access to a larger index will be able to provide personalized search results better aligned to users' preferences’.143 In other words, the more data a company can collect, the more it can improve its ability to provide a better service to its users.

Following these cases, data protection rules are usually used as an argument to limit a review under competition law, instead of broadening it.144 This hands-off approach may indicate an

attempt to avoid tackling controversial practices of which the effects are not easily measurable.145 A strict line between competition law and data protection law can therefore be

detected. Following these cases, the Bundeskartellamt could have argued that EU law does not allow breaches of competition law being based on data protection violations and therefore it could use stricter German law, instead of EU law. However, the involvement of both data protection violations and competition law are inextricably intertwined in the Facebook case; Because of its dominant position, it has the opportunity to violate data protection rules (since there is no alternative for users to leave the platform if they do not agree with the violation) and because it violates data protection rules, it can collect more data, become more efficient and therefore strengthen their dominant position. A violation of one causes a violation of the other. Since there has been no decisions from the Commission or rulings of the Court on this matter,

140 Volmar, supra note 117, p. 207

141 COMP/M. 8788 Apple/Shazam, 6 September 2018, paras 327 142 COMP/M.4731 Google/ DoubleClick, 11 March 2008, para 45

143 COMP/M.5727 MICROSOFT/ YAHOO! SEARCH BUSINESS, 18 February 2010, para 225-226 144 Volmar, supra note 117, p. 214

145 K. Bania ‘The role of consumer data in the enforcement of EU competition law’, European Competition

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this is an unresolved matter in EU law. Therefore, the Bundeskartellamt still should have applied EU law.

Although the Commission and the Court prefer to separate competition law and data protection law, in several other cases competition law was involved in other branches of law. This will be discussed in the next paragraph.

6.3. Competition law vs other branches of law

In the Allianz Hungária146 case, the CJEU relied on the violation of insurance law in order to establish a restriction of competition by object, which is prohibited under Article 101 TFEU.147 A violation of Article 102 TFEU has been established in cases where there was a breach of intellectual property law. In the Duales System Deutschland case, the CJEU ruled that an exploitative abuse can be established when licence fees are charged without using the service protected by the trademark.148 Another case is the AstraZeneca case, where the CJEU found an abuse of a dominant position by a pharmaceutical group by providing misleading representations to patent offices in order to obtain a supplementary protection certificate, in order to prevent or delay competitors from entering the market.149 Scholars have argued that

using intellectual property law in competition law assessment can be seen as an example that competition law does not always have sufficient tools to assess abusive conduct.150 Therefore,

‘external parameters may be borrowed from other legal regimes’.151

As explained above, other branches of law can be involved in competition issues.152 If this can be applied to the Facebook case depends on several factors which will be discussed in the next paragraphs.

146 Case C-32/11, Allianz Hungaria et al. vs. Gazdasá gi Versenyhivatal, [2013] ECLI:EU:C:2013:160, para 164 147 I. Graef, EU Competition Law, Data Protection and Online Platforms. Data as Essential Facility, Kluwer

Law International, 2016, p. 359

148 Case C-385/07, Duales System Deutschland v. Commission, [2009] ECLI:EU:C:2009:456 149 Case C-457/10, AstraZeneca vs. Commission, [2012] ECLI:EU:C:2012:770, para 106

150 Schneider, supra note 76, p. 221; Joseph Drexl, Research Handbook on intellectual property and competition

law, Edward Elgar, (2008), p. 64-68.

151 Schneider, supra note 76, p. 221; Costa-Cabral, supra note 123, p. 12-14

152 Schneider, supra note 76 p. 221; Case 127/73 Belgische Radio en Televisie vs. SABAM case, where the CJEU

‘considered the ‘unfair’ violation of the original right-holder’s copy- right by the collecting society as the basis of an abuse of dominant market position’ and the Daft Punk decision, ‘where the Commission regarded as abusively exploitative, and thus enforceable under art. 102 TFEU, the rejection by the collecting society SACEM of the application for membership referring only to some and not to the entirety of the author’s rights’ (COMP/C2/37.219, Banghalter & Homem Christo vs. SACEM, 12 August 2002)

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