German Bundesgerichtshof publishes reasoning for interim Facebook decision

In 2019, the German competition authority, the Bundeskartellamt, found that Facebook had broken competition law by abusing its dominant position in relation to the terms and conditions imposed on consumers and data privacy. Facebook asserted compliance with the GDPR as a defence, but this did not stand scrutiny. The Bundeskartellamt ordered Facebook to comply with its duties as a dominant firm under applicable competition law.

Facebook appealed against the Bundeskartellamt decision and obtained an interim suspension to the Bundeskartellamt’s decision in court. In turn, the Bundeskartellamt applied to appeal the interim suspension.

In June, the Bundeskartellamt was successful, as the Bundesgerichtshof, a higher court, lifted the suspension. This effectively reinstated the Bundeskartellamt’s decision and order. The reasoning behind this decision has now been published.

The decision makes a number of comments regarding the position of Facebook in the German market. In particular, the Bundesgerichtshof does not appear to have any doubt as to Facebook’s position of dominance, or that there has been an abuse of that position. One important point to note is that no amount of privacy washing acts as a full defence to an accusation of abuse of dominance, at least at this interim proceeding stage.

This decision relates only to an interim matter (the suspension of the Bundeskartellamt’s decision). The substantive case on Facebook’s appeal still needs to be heard, and will be a very interesting one to follow.

The decision can be found (in German) on the Bundesgerichtshof website.

Please contact Tim Cowen if you have any questions relating to competition law, or the Facebook case in particular.

Contributing Advisors

Myles CulmerDirector, BDO Advisory Services