Facebook wins battle against German privacy regulators

Facebook scored a win in its battle against German privacy regulators who claimed they could regulate the policies of the social network. According to a Bloomberg report published yesterday, a Hamburg court halted enforcement of an order by the city's data watchdog who had told Facebook to let users to sign up to the social network using a pseudonym.

Germany's cartel office had opened an investigation into Facebook over suspected abuse of market power through breaches of data protection law. According to the watchdog, the social network's terms of service as regards its use of user data might allow it to abuse its dominant position in the social network market.

''For advertising-financed internet services such as Facebook, user data are hugely important. For this reason, it is essential to also examine under the aspect of abuse of market power whether the consumers are sufficiently informed about the type and extent of data collected,'' Federal Cartel Office president Andreas Mundt said in a statement.

Facebook, the world's biggest social network with 1.6 billion monthly users, depends on revenues from targeted advertising, thanks to the data it gathered about its users' friends, opinions and activities from their postings.

German law did not apply to Facebook's privacy policy, as it operated in Europe, from its headquarters in Ireland, the court said in a preliminary ruling.

The applicable law is that "of the European Union member state that is most closely related to the data processing at stake," the court said. "As to the real-name rule, this is Facebook's Ireland branch."

Hamburg's data regulator Johannes Caspar and other German privacy watchdogs had been fighting Facebook for years over the implementation of European data-protection rules. The US company had argued that only the Irish regulator had jurisdiction over its compliance with EU privacy law.