Lore Leitner of Pinsent Masons, the law firm behind Out-Law.com, said that data protection authorities (DPAs) in the EU are becoming increasingly frustrated with limitations to their ability to control Google’s power in collecting and using personal data.
She said, however, that the new preliminary opinion issued by the European Data Protection Supervisor (EDPS) has highlighted the potential for EU scrutiny of Google’s activities to shift from an assessment of whether the company is compliant with EU data protection laws to whether the way Google gathers and uses personal data gives the company advantages in a way that is in line with competition rules.
In his opinion, EDPS Peter Hustinx said that an investigation into the “costs and benefits” associated with the way companies often provide free services to consumers in exchange for the right to gather and use their personal data is “overdue”. He called for DPAs and competition regulators to work closer together so as to help “stimulate the market for privacy-enhancing services”.
“Firms operating in the digital economy do not yet consider privacy as opportunity for competitive advantage,” Hustinx said in the new opinion. “On the contrary, there is the danger of a ‘race to the bottom’ of privacy protection, where failure to comply with data protection rules and the acquisition of data through anti-competitive means may have become symptomatic of market power, with externality costs borne by users.”
“A useful comparison may be drawn with the spread in the 1960s and 1970s of the notion of corporate social and environmental responsibility. Companies began to realise the importance of the socio-economic impact of their business and how it was perceived by their customers. They now typically benchmark their own policies against those of competitors, and there is a genuine market for product safety and green technologies. A more joined-up approach to data protection and competition could help stimulate a similar level of competition in online services,” he said.