On March 2, the Bundeskartellamt (Germany’s Federal Cartel Office) commenced proceedings against an internet giant. According to the Federal Cartel Office, there is reason to suspect that the company has abused its dominant market position.
GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London conclude: In the estimation of the Bundeskartellamt, the internet company may have abused its dominant market position in the field of social networks and in so doing violated antitrust law.
The competition authority announced that it is pursuing its initial suspicion that the company has abused its potentially dominant position in the market and breached data protection regulations with its contractual terms and conditions regarding the use of user data. The relevant proceedings have now been commenced. According to statements made by the President of the Bundeskartellamt in a press release, user data is of enormous importance to internet services that are financed by advertising, which is why it is necessary to investigate from the perspective of an abuse of market power whether users were sufficiently informed about the nature and scope of data collection.
The point of criticism is that the internet firm requests the consent of its users for the collection and use of data. The Bundeskartellamt has stated that the creation of user profiles makes it possible for businesses to develop carefully targeted advertising. It went on to say that in light of national data protection legislation there is considerable doubt as to whether this practice is permissible. The competition authority noted that if this situation did in fact encompass a dominant market position, this might also constitute an infringement of antitrust law. The Bundeskartellamt is conducting the proceedings in close cooperation with consumer protection associations, data protection officers, the European Commission as well as competition authorities from other EU member states.
In order to ensure effective and diverse competition, infringements of Germany’s Gesetz gegen Wettbewerbsbeschränkungen (GWB) [Act against Restraints of Competition] or abuse of a dominant market position are met with severe punishment that entails appropriate sanctions.
Lawyers who are versed in the field of antitrust law ought to be consulted at an early stage if one is to avoid time-consuming and expensive legal disputes. They can examine whether there are any concerns from the perspective of antitrust law and help to overcome potential difficulties. If claims have already been filed against a company for alleged violations of antitrust law, competent lawyers can assume responsibility for fending off these claims. Conversely, they are also able to assert claims against companies that have infringed antitrust law or competition law.
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