Meta Platforms (NASDAQ: META) faces a setback as the European Union’s highest court upheld the ruling by German antitrust regulators that the company had engaged in data harvesting and abused its dominance in the social media realm. This ruling paves the way for Germany’s leading antitrust enforcer, the Bundeskartellamt, to restrict Meta from combining user data collected across its various platforms, including Facebook, Instagram, and WhatsApp, as well as from external websites and apps, without explicit user consent.
The court’s decision deals a blow to Meta’s business model, which heavily relies on leveraging the extensive user data it accumulates from its services and online browsing habits to deliver targeted advertisements. Furthermore, this ruling bolsters the case for stricter regulations on the world’s largest tech companies, with potential implications for other European Union antitrust authorities.
The forthcoming Digital Markets Act, an E.U. antitrust law set to take effect in the near future, will grant regulators enhanced powers to foster competition within the technology sector. Notably, the court ruling permits E.U. authorities to scrutinize data collection practices that may undermine competition — an innovative approach to antitrust enforcement.