German Supreme Court upholds BKartA Facebook remedy – we “like” our new CLIP of the Month

25.06.2020

On 23 June 2020, the German Supreme Court (the Bundesgerichtshof, or BGH) upheld the remedy imposed by a 2019 decision of the German Competition Authority (the Bundeskartellamt, or BKartA), resulting from a finding that Facebook has abused a dominant position through its data collection practices (we reported on the original decision here).  The BKartA ordered Facebook to stop collecting user data via third party websites without users’ consent, but Facebook obtained an injunction from the Düsseldorf Higher Regional Court suspending that obligation.  This week’s BGH ruling has lifted that suspension, holding that there were no serious doubts about either dominance or abuse in the case.  While this ruling does not represent a final ruling on the merits (which may warrant a reference to the CJEU), it does represent a significant development in the BKartA’s case against Facebook, and will have direct consequences for Facebook and its users in Germany.

Our CLIP of the Month this month is a fascinating analysis of the BGH judgment and its wider context from Professor Ruprecht Podszun of the University of Düsseldorf, writing on the excellent D’Kart Antitrust blog (specialising in German antitrust issues).  As well as the detailed review of the history of the case, and an explanation of why this judgment was rather unexpected, Professor Podszun explains his thinking on how this ruling fits in with a wider move to a theory of antitrust law based on the principle of independent decision-making.  While this theme is already clear in the sphere of cartels and vertical agreements (such as RPM or restrictions on cross-border trade), it has been less overt in abuse of dominance cases, in particular where the parties which are (on the theory of this case) being deprived of decision-making rights are individual consumers.  Indeed, it is at best unclear whether EU, as opposed to German, competition law could encompass the type of conduct that is the subject of the BKartA decision. However, at a broader level, the concept of dominance involves an ability to act independently of customers and consumers, and many types of abuse (think rebate schemes, excessive pricing, etc…) involve unilaterally imposed schemes which result in a loss of choice for the customers of the dominant undertaking.  Professor Podszun’s analysis provides an interesting lens through which to view different types of competition infringement, including the German Facebook case.

Sophie Lawrance

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