A list of European enforcement action, official legislative (Parliamentary) reports, and cases concerning Facebook with respect to data protection and privacy. This is a work in progress, last updated November 2018.
Data Protection Commissioner (Ireland) v Facebook Ireland Limited, Maximillian Schrems [Case C-311/18]
Jurisdiction: European Union, Ireland
Status: Case still in progress
Authority: Court of Justice of the European Union
Keywords: EU Data Protection Directive (95/46/EC); EU/US Privacy Shield; Fundamental Rights
When personal data travels between Europe and America, it must cross international borders lawfully. If certain conditions are met, companies can rely on the US-EU Privacy Shield, which functions as a sort of “tourist visa” for data.
Earlier this week (19 November) the United States Federal Trade Commission finalised settlements with four companies that the agency accused of falsely claiming to be certified under the US-EU Privacy Shield framework. This news closely follows the highly anticipated second annual joint review of the controversial data transfer mechanism.
IDmission LLC, mResource LLC, SmartStart Employment Screening Inc., and VenPath Inc. were slapped on the wrist by the FTC over allegations that they misrepresented their certification. But this is just the latest saga in an on-going debate regarding the Privacy Shield’s fitness for purpose. Only this summer, the European Parliament urged the European Commission to suspend the Privacy Shield programme over security and privacy concerns.
Background and purpose
Designed by the United States Department of Commerce and the European Commission, the Privacy Shield is one of several mechanisms in which personal data can be sent and shared between entities in the EU and the United States. The Privacy Shield framework thereby protects the fundamental digital rights of individuals who are in European Union, whilst encouraging transatlantic commerce.
This is particularly important given that the United States has no single, comprehensive law regulating the collection, use and security of personal data. Rather, the US uses a patchwork system of federal and state laws, together with industry best practice. At present, the United States as a collective jurisdiction fails to meet the data protection requirements established by EU lawmakers.
Today, more than 3,000 American organisations are authorised to receive European data, including Facebook, Google, Microsoft, Twitter, Amazon, Boeing, and Starbucks. A full list of Privacy Shield participants can be found on the privacyshield.gov website.
Complaints and non-compliance?
There is no non-compliance. We are fully compliant. As we’ve told the Europeans, we really don’t want to discuss this any further.
—Gordon Sondland, American ambassador to the EU
Although the Privacy Shield imposes stronger obligations than its ancestor, the now-obsolete “Safe Harbor,” European lawmakers have argued that “the arrangement does not provide the adequate level of protection required by Union data protection law and the EU Charter as interpreted by the European Court of Justice.”
In its motion to reconsider the adequacy of the Privacy Shield, the EU Parliament stated that “unless the US is fully compliant by 1 September 2018” the EU Commission would be called upon to “suspend the Privacy Shield until the US authorities comply with its terms.” The American ambassador to the EU, Gordon Sondland, responded to the criticisms, explaining: “There is no non-compliance. We are fully compliant. As we’ve told the Europeans, we really don’t want to discuss this any further.”
Věra Jourová, a Czech politician and lawyer who serves as the European Commissioner for Justice, Consumers and Gender Equality, expressed a different view: “We have a list of things which needs to be done on the American side” regarding the upcoming review of the international data transfer deal. “And when we see them done, we can say we can continue.”
The list from the Parliament and the First Annual Joint Review [WP29/255] (.pdf) concerns institutional, commercial, and national security aspects of data privacy, including:
American surveillance powers and use of personal data for national security purposes and mass surveillance. In particular, the EU is unhappy with America’s re-authorisation of section 702 of the Foreign Intelligence Surveillance Act (FISA), which authorises government collection of foreign intelligence from non-Americans located outside the United States (Remember Edward Snowden and PRISM? See the Electronic Fronteir Foundation’s explanation here)
Lack of auditing or other forms of effective regulatory oversight to ensure whether certified companies actually comply with the Privacy Shield provisions
Lack of guidance and information made available for companies
Facebook and the Cambridge Analytica scandal, given that 2.7 million EU citizens were among those whose data was improperly used. The EU Parliament stated it is “seriously concerned about the change in the terms of service” for Facebook
Persisting weaknesses regarding the respect of fundamental rights of European data subjects, including lack of effective remedies in US law for EU citizens whose personal data is transferred to the United States
The Clarifying Overseas Use of Data (“CLOUD”) Act signed into law in March 2018 allows US law enforcement authorities to compel production of communications data, even if they are stored outside the United States
In a joint press release last month, the representatives from the EU and USA together reaffirmed “the need for strong privacy enforcement to protect our citizens and ensure trust in the digital economy.” But that may be easier said than done.
In the event that the Privacy Shield is suspended, entities transferring European personal data to the United States will need to consider implementing alternative compliant transfer mechanisms, which could include the use of Binding Corporate Rules, Model Clauses, or establishing European subsidiaries. To ensure that the American data importer implements an efficient and compliant arrangement, such alternatives would need to be assessed on a case-by-case basis involving careful review of data flows, and the controller and processors involved.
Regardless of the method used to transfer data, American companies must ensure that they receive, store, or otherwise use European personal data only where lawfully permitted to do so. The joint statement noted above concluded by saying that the “U.S. and EU officials will continue to work closely together to ensure the framework functions as intended, including on commercial and national-security related matters.”
The European Commission is currently analysing information gathered from its American counterparts, and will publish its conclusions in a report before the end of the year.
著作權 or Zhùzuòquán means “copyright” in Mandarin Chinese. Earlier this week, Chinese authorities kicked-off a campaign against online copyright infringement. Is this crackdown a response to increased pressure from foreign investors —and the Trump administration— for China to combat widespread piracy and counterfeiting?
The latest Jianwang Campaign Against Online Copyright Infringement was jointly launched by several government agencies including the National Copyright Administration of China, the Cyberspace Administration, and the Ministry of Public Security. It will target key areas for intellectual property rights (IPRs) including unauthorised republication of news and plagiarism on social media, broadcasting copyrighted content on video sharing apps, and setting up overseas servers to get around territorial restrictions. The campaign, which will last for at least four months, will also push internet service providers to enhance internal supervision systems.
Similar to the crackdown last September, the campaign is seen by many as an attempt to alleviate major concerns among foreign investors, including those in the United States. China’s lack of strong IPRs protection measures “frequently draw complaints from foreign investors and have been a long-standing focus of attention at annual talks with the US and Europe.”
The issue hit headlines again last autumn, when the Office of the United States Trade Representative led an official seven-month investigation into China’s intellectual property theft, under section 301 of the Trade Act of 1974. Bolstered by the USTR’s findings that “Chinese theft of American IP currently costs between $225 billion and $600 billion annually”, the Trump Administration imposed retaliatory tariffs on Chinese products in early July.
Considering 200 years of history: is “Chinese culture” to blame for copyright infringement?
In 2012, an article on Forbes explained that “IP protection will always be an uphill struggle in China and for companies doing business there,” as individual rights –including IPRs– may be at odds with traditional Chinese society. What support does that argument have?
Firstly, it’s important to note that IP is not an indigenous concept in China. Historically speaking, the lack of a strong IP regime can be traced to the early roots of China’s economic system, which emphasised agriculture and generally neglected large-scale commerce. Before the Opium War (1839-1842), foreign powers were unconcerned with the lack of IP protection in China primarily because there was little foreign investment there to protect in the first instance. Furthermore, the main European exports to China at the time were unbranded bulk commodities, and not technological innovations or creative works such as software, film, and music.
During the Chinese Revolution, Mao Zedong’s Communist Party abolished all legal systems in 1949. Throughout the Cultural Revolution of the 1960s and 1970s, China lacked any semblance of a functioning legal system. As per Communist political ideology, “Law” in China during this time was guided by general principles and shifting policies, rather than detailed and constant rules.
When chairman Deng Xiaoping adopted an open-door economic policy in the late 1970s, China’s trading partners were no longer restricted to the USSR and Soviet satellites, but instead now included Western countries. Several years later, the Communist party officially pronounced that the Cultural Revolution had been a grave error, and began to shift its economic and social reforms. To support its burgeoning and rapid economic development, China accordingly began to embrace a formal IPR strategy. When China joined the World Trade Organisation in 2001, it became bound by the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).
Enhancing the protection of intellectual property rights is a matter of overall strategic significance, and it is vital for the development of the socialist market economy.
—Li Keqiang, Premier of the People’s Republic of China
The Wall Street Journal further explains that, incentivised by the influx of foreign technology and media companies wishing to invest in China, IPR protection in the country has been rising steadily for the last decade. In 2006, there were approximately 6,000 copyright lawsuits: in 2016, that number had multiplied nearly 15 times over to 87,000 cases.
If Chinese IP law is increasingly comparable to European and American standards, why then does China continue to attract disapproval?
Although the rate of unlicensed or “pirated” software in China is nearly 70 per cent, the piracy rates in Indonesia, Pakistan, Vietnam, Albania, Belarus, Ukraine, Bolivia, Algeria, Botswana, Zimbabwe and many others is much higher. However, because Chinese economy is behemoth, and uses an incredible amount of software, the value of such pirated software is over $6.5 billion.
Secondly, although true that Chinese IPR enforcement is catching up to U.S. and European standards, considerable weakness remains in the high levels of bureaucracy. For example, court decisions might apply on a provincial level rather than nationally, and judges often have different interpretations of the laws.
Of China’s 1.5 billion residents, nearly 600 million live in rural communities. While central authorities may establish the laws and regulations, it is the local authorities tasked to implement those laws and regulations. It is therefore important to note that local protectionism probably constitutes the largest obstacle to cracking down on piracy in China.
Finally, from a sociological perspective, it could be argued that English-language media promotes an inaccurate portrayal of IP piracy as somehow rooted in Chinese culture and Otherness. To be fair, European and American copyright law is also plagued with intense debate and woeful inadequacies surrounding the evolution of online technologies.
IP is a complex area of law, and for a variety of reasons copyright is perhaps one of the most difficult areas to legislate. China still has a long way to come in respect of is IPR regime, a sentiment acknowledged by Beijing. However, the danger of perpetuating snippets and sound bites without adequate context is non-trivial. IPR policy affects United States foreign policy, and incorrect understanding the problem can lead to disruptions in international relations, or even trade wars.
Media companies who call themselves social networks will have to recognize that they, too, have to take on responsibility for the content with which they earn their millions.
-— Markus Breitenecker, CEO of Puls4
Who is to blame, if someone records TV programmes and illegally uploads them to YouTube: YouTube, or the individual? According to the Commercial Court of Vienna, YouTube is jointly responsible for copyright breaches from user-uploaded content. Is this einer Entscheidung, die das Internet revolutionieren könnte – a decision that could revolutionize the Internet?
To date, the unanimous opinion of European case law supports the position that YouTube is only a platform, an intermediary, a service provider, a neutral host, and so on – and therefore could not bear the responsibility for stolen content. That’s no longer true, says the Handelsgericht Wien (Vienna’s Commercial Court).
In its judgement of 6 June, the Court handed Austrian TV broadcaster Puls4 a key victory in its four-year legal battle with Google-owned YouTube. In 2014, Puls4 had sued YouTube for allowing Puls4’s stolen content to appear on the YouTube platform. YouTube responded by asserting the Host Provider Privilege set out in Article 14 of the E-Commerce Directive 2000/31/EC, which in certain situations shields host providers from being held responsible for the actions of its users.
The Americans have a similar provision in the Online Copyright Infringement Liability Limitation Act (OCILLA), which forms part of the Digital Millennium Copyright Act. The OCILLA creates a conditional “safe harbor” for online service providers by shielding them for their own acts of direct copyright infringement, as well as from potential secondary liability for the infringing acts of others. In exempting internet actors from copyright infringement liability in certain scenarios, both Article 14 and the Safe Harbor rule aim to balance the competing interests of the copyright holders, and those who use the content online.
Where YouTube is simply a host provider, it is the individual who uploaded the video in the first instance who is to blame for the theft of copyrighted material. This time, the Court disagreed with YouTube’s argument, and has found finding the media giant to be jointly responsible for the copyright infringement.
So, why should we care about the Puls4 case? Although Austrian case law is not binding for other European Union member states, the Commercial Court’s judgment sets a precedent for denying Host Provider Privilege to YouTube. This may encourage similar decisions in the future which are based on the same line of argument.
Speaking to German newspaper Der Standard, Puls4’s CEO Markus Breitenecker explained that YouTube had effectively abandoned its neutral intermediary position and assumed an active role, which provided it with a knowledge of or control over certain data. In European legislative parlance, this is known as being a false hosting provider or false intermediary.
For years, many of us have assumed that YouTube is just a inanimate platform to which users upload videos. This case underscores that YouTube can no longer “play the role of a neutral intermediary” because of its “links, mechanisms for sorting and filtering, in particular the generation of lists of particular categories, its analysis of users’ browsing habits and its tailor-made suggestions of content.”
Puls4 and YouTube have until early July to petition the court, before it issues its binding ruling. In a statement to The Local Austria, YouTube said it was studying the ruling and “holding all our options open, including appealing” the decision. In the meanwhile however, YouTube noted that it takes protecting copyrighted work very seriously.
If the preliminary decision is upheld, YouTube must perform a content check upon upload, instead of simply removing copyright infringing content upon notification. In respect of this, the Viennese court stated that “YouTube must in future — through advance controls — ensure that no content that infringes copyright is uploaded.” It is therefore rather timely that YouTube began beta testing a feature called Copyright Match last month, a tool which allows users to scan the platform to locate full re-uploads of their original videos on other users’ YouTube channels.
The European Parliament seems to think the arguments about false hosting providers is best left to the courts to decide. Despite the E-Commerce Directive being more than 15 years old, there is no pressing need for a reform. In a recent report on the matter, the European Parliament’s Committee on the Internal Market and Consumer Protection stated that while false hosting providers may not have been envisaged at the time of the adoption of the E-Commerce Directive in 2000, “the delineation between passive service providers caught by Article 14 and active role providers remains an issue for the court.”
The GDPR has been in force for less than two weeks, but Europeans have already started to contact companies left, right and centre to exercise their newly enshrined statutory “right to be forgotten.”
However, this right is not absolute, and only applies in certain circumstances. Let’s look at the balancing act between a data subject’s right to have their data erased on the one hand, and an organisation’s need to maintain data for legitimate purposes, on the other.
Organisations (data controllers and processors) are obliged to only collect and use personal data in a lawful manner, as set out in Article 6. There are several types of “lawful processing,” including in instances where an individual grants his or her explicit and informed consent. But lawful processing also covers the use of data for a controller’s legitimate interests, the performance of a contract, or legal obligations, such as fraud prevention. For more on lawful processing, check out my earlier post – Lights, camera, data protection?
With this in mind, it’s important to note that only in certain scenarios does an individual have the right to be forgotten. Under Article 17(1), their data must be either:
no longer necessary for the original purpose
processed based on consent, which is now withdrawn
processed based on the organisation’s legitimate interests, which the individual objects to;
processed for direct marketing purposes, which the individual objects to;
processed unlawfully (in contravention of Article 6); or
erased to comply with a legal obligation.
But before an organisation hits “delete” it must see if any purposes for retention apply. In pre-GDPR days gone by, data subjects had to prove they had the right for their data to be erased. The burden now lies with the controller to prove that they have a legal basis for retaining the data. If so, the organisation has a lawful reason to refuse the erasure request. In fact, deleting data when an exemption does apply could be a breach of the law!
the right of freedom of expression and information;
complying with a legal obligation, or for performing a task in the public interest;
for reasons of public health;
for archiving in the public interest, including scientific or statistical research; or
for the establishment, exercise or defence of legal claims.
Additionally, “manifestly unfounded” or “excessive” requests may be refused outright.
From what I’ve seen in practice over the last few days, most erasure requests are made because an individual no longer wants to receive marketing emails. Fair enough: in shifting responsibility onto corporate controllers, the right to be forgotten strengthens individual control. It also signifies public disapproval of entities which process – and, in some instances abuse – enormous quantities of personal information without the explicit consent or knowledge of the individuals concerned.
For those of us interested in the societal and human rights implications (I’m telling you – data protection isn’t just for the techies amongst us!) it’s worthwhile to consider how journalism fits into the picture.
As Oxford’s International Data Privacy Law summarises rather eloquently: The nebulous boundaries and susceptibility to misuse of the right to be forgotten make it a blunt instrument for data protection with the potential to inhibit free speech and information flow on the Internet.
As early as 2012, Reporters Without Borders (formally, Reporters Sans Frontières) criticized the right to be forgotten – then in early draft stages – as a generalised right that individuals can invoke when digital content no longer suits their needs. This runs the risk of trumping the public interest in the information’s availability. RSF also contends that the demand for complete erasure of online content, or the “right to oblivion”, could place impossible obligations on content editors and hosting companies.
EU Commissioner Viviane Reding responded to the criticism from RSF by explaining that the [GDPR] provides for very broad exemptions to ensure that freedom of expression can be fully taken into account.
Note – this post covers the statutory Right to Erasure under Article 17 of the GDPR. Although related, it is distinguished from the recent high-profile cases against Google, in which the English Supreme Court held that a defendant convicted of a crime was entitled to the right to be forgotten, and therefore delisted from Google search results. A more serious offence, with fewer mitigating circumstances, did not attract the same right.
In my previous post, I wrote about the European Union’s sweeping new Directive on Copyright in the Digital Single Market, which is currently in draft stages. But copyright legislation is getting an update on the other side of the pond, too.
Since 1909 — before recordings of music even existed — Section 115 of the Copyright Act has regulated the licencing of musical works. Many songwriters and music publishers have trouble collecting royalties for the use of their songs played via digital streaming services. Amongst other things, the proposed Music Modernisation Act will modernise how compensation for mechanical licenses, which include digital streaming, is determined.
Last week, The United States House Judiciary Committee voted unanimously (32-0) to approve House Bill 4706, “to provide clarity and modernize the licensing system for musical works under section 115 and to ensure fairness in the establishment of certain rates and fees.” More commonly known as the Music Modernization Act (“MMA”), the bill now heads for consideration by the full House of Representatives. The MMA has received wide bipartisan support from Democrats and Republicans alike, and appears to be “on the fast track” for approval.
Importantly, the MMA will create an American agency or “mechanical licensing collective” that would house all music publishers under one roof. It is expected that the agency will have a database of ownership information, which will increase transparency and help identify music creators who are owed royalties.
Once established, the digital streaming services will pay the mechanical licensing collective, which in turn tracks and collects royalties on behalf of the artists. As explained by Committee Chairman Bob Goodlatte (a Republican from Virginia), the MMA “boosts payments for copyright owners and artists by shifting the reasonable costs of a new mechanical licensing collective onto digital music services, who themselves benefit from reduced litigation costs as a result of other provisions in the bill.”
Speaking to ABC news, John Simson noted that Americans “…have a 1909 statue trying to govern 2018 technology, and it doesn’t work.” Mr Simson is a professor at the American University and founding member of Sound Exchange, a non-profit organisation set up to collect and distribute performance royalties.
Intellectual Property Subcommittee Vice Chairman Doug Collins (a Republican from Georgia) noted that “the current music licensing landscape undervalues music creators and under-serves music consumers. Outdated copyright laws have produced unnecessary liabilities and inefficiencies within the music licensing system, and stakeholders across the music industry have called for reform. This bill moves the music industry towards a freer and a fairer market, enabling it to leverage the present and future benefits of the digital age.”
The first section of the bill concerns how modern digital music services operate, and will create a “blanket licensing system” to quickly license and pay for musical work copyrights. A key aim includes discouraging lawsuits in favour of simply ensuring that artists and copyright owners are paid in the first place without such litigation (see “No lawsuits over unpaid royalties after 1 January 2018?” below).
The second section, “Compensating Legacy Artists for their Songs, Service, and Important Contributions to Society (CLASSICS) Act” will focus on public performance rights for pre-1972 recordings. In particular, musicians with pre-1972 recordings will receive royalty payments when their tracks are played on the radio, online, or on television.
The third section, “Allocation for Music Producers (AMP) Act,” will ensure that record producers, sound engineers, and other creative professionals also receive compensation for their work.
No lawsuits over unpaid royalties after 1 January 2018? Of course, the MMA is not without its detractors who are quick to point out several key issues. Firstly, the bill sets out a broad limitation of liability clause which essentially shuts down any potential lawsuits filed after January 1st 2018. That’s not a typo – Section 2(10)(A), the MMA really does apply a retrospective restriction on legal action.
Without the possibility of litigation, songwriters (and other copyright holders) who have unpaid royalties have one sole and exclusive remedy: they must go through the process set out in the legislation, governed by the dispute resolution committee of the mechanical licensing collective.
And while the mechanical licensing collective created by the MMA will have a board of directors, that board will be comprised of ten music publishers (record labels) together with only four songwriters! Furthermore, as currently written, the MMA provides no grievance process for excluded writers and those who receive unjust treatment. Is this likely to hit the right note with independent artists and smaller record labels?
Featured image – Francis Barraud, His Master’s Voice.
Facebook may believe that dubious data collection and security practices justify a more connected audience: the incoming General Data Protection Regulations say differently.
Once again, data privacy is in the headlines. But this time, it isn’t a credit agency or department store that has fallen short of consumer expectations: instead, it’s Facebook. Much credit is due to Carole Cadwalladr and her team at The Guardian, who first broke the the Cambridge Analytica story.
#DeleteFacebook was trending on Twitter for a while, and I myself was considering ditching my account – not least because I simply don’t use Facebook often. While I’ve decided against deletion, I was genuinely saddened – although, in retrospect, not surprised – to come across the leaked 2016 “Ugly Truth” Memo from a Facebook executive Andrew “Boz” Bosworth. You can see the Memo in full at Buzzfeed, but the part that hit me hardest reads as follows:
We connect people. Period.
That’s why all the work we do in growth is justified. All the questionable contact importing practices. All the subtle language that helps people stay searchable by friends. All of the work we do to bring more communication in. The work we will likely have to do in China some day. All of it.
The natural state of the world is not connected. It is not unified. It is fragmented by borders, languages, and increasingly by different products. The best products don’t win. The ones everyone use win.
“Questionable contact importing practices”? By Bosworth’s own admission, “the ugly truth is that we believe in connecting people so deeply that anything that allows us to connect more people more often is de facto good.”
The General Data Protection Regulations (GDPR) say differently. With less than two months to go until the implementation date of 25 May (!) I’ve set out a little refresher on the main responsibilities for organisations below.
Article 5 of the GDPR contains Six Principles of personal data collection and processing. The data controller (the company collecting or otherwise controlling the data) are responsible for, and must be able to demonstrate, compliance with these principles.
(A) Processed lawfully, fairly and in a transparent manner.
A company collecting data must make it clear as to why the data are being collected, and how the data will be used. The company must provide details surrounding the data processing when requested to do so by a person whose data is collected (the “data subject”). “Questionable practices” are likely neither fair nor transparent!
(B) Collected for specified, explicit and legitimate purposes.
Have you ever filled in a form, only to think, “why am I being asked this question?” This principle states that organisations should not collect any piece of personal data that doesn’t have a specific purpose, and a data subject must give explicit consent for each purpose. A lawful purpose could mean fulfilling a contract: for example, your address is required for shipping something you bought online.
(C) Adequate, relevant and limited to what is necessary.
Companies strive to understand customer buying behaviours and patterns based on intelligent analytics, but under this principle, only the minimum amount of data required may be stored. Asking for one scanned copy of a drivers’ licence may be adequate, but asking for a drivers’ licence, passport, and birth certificate might be more than necessary.
(D) Accurate and, where necessary, kept up to date.
Controllers must ensure personal data is accurate, valid and fit for purpose. Accordingly, data subjects have the right under Article 16 (Right of Rectification) to rectify any personal data held about themselves.
(E) Kept for no longer than is necessary.
This principle limits how data are stored and moved, and for how long. When data is no longer required, it should be deleted. This is closely related to the Right of Erasure (“Right to be Forgotten”) under Article 17, which I previously wrote about in respect of the Google case in England.
(F) Processed in a manner that ensures appropriate security.
This principle is perhaps what most people think about when they think of data protection. It means that IT systems and paper records must be secure, and the security must be proportionate to the risks and rights of individual data subjects. Negligence is no longer an excuse under GDPR!
In 2016, a Gallup study found that Millennials (those of us born between 1981 and 1996) are generally aware of potential data security risks, but less likely to be concerned about them. Prior to familiarising myself with these principles, I simply thought data protection was another phrase for “IT security”. I thought it was just about firewalls, encryption, and outsmarting hackers.
But in the months I’ve been helping clients to get ready for the GDPR, I’ve realised that compliance is about more than just having strong passwords: it really is a mindset. That’s what’s so disappointing about Facebook’s apparent attitude towards the end consumer, in which people are seen only as a series of clicks or “likes” which can be analysed, predicted, and manipulated – at any cost. My Facebook account may remain active, but I for one will certainly be less engaged.