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Meta Platforms is required to limit the use of personal data collected from Facebook for targeted advertising, as ruled by Europe's high court on Friday, supporting privacy advocate Max Schrems. Schrems brought his concerns to an Austrian court, claiming he was subjected to targeted advertisements due to Meta's personalized advertising practices that utilize personal data.
The Austrian court then requested clarification from the Court of Justice of the European Union (CJEU) in Luxembourg, which ruled in favor of Schrems.
The CJEU stated, "An online social network like Facebook cannot utilize all personal data collected for targeted advertising without temporal restrictions and without differentiating between types of data."
The judges emphasized that the principle of data minimization, as outlined in the EU's General Data Protection Regulation (GDPR), supports this stance.
In response, Meta highlighted its investment of over 5 billion euros to enhance privacy within its products, asserting that it does not use sensitive categories of data provided by users for ad personalization, and that advertisers are prohibited from sharing sensitive information.
"Everyone using Facebook has access to a wide range of settings and tools that allow people to manage how we use their information," a Meta spokesperson said.
Schrems' lawyer Katharina Raabe-Stuppnig welcomed the ruling.
"Following this ruling only a small part of Meta's data pool will be allowed to be used for advertising - even when users consent to ads. This ruling also applies to any other online advertisement company, that does not have stringent data deletion practices," she said.
This ruling also extends to any other online advertising companies that lack rigorous data deletion practices." Schrems has previously taken legal action against Meta for alleged violations of GDPR. The case is identified as C-446/21 Schrems (Communication of data to the general public).
Schrems, an Austrian activist lawyer, has been a persistent challenge for Facebook since his law school days 13 years ago, driving a series of significant rulings from the Court of Justice against the company.
Two of these rulings dismantled comprehensive data-sharing agreements between the EU and the U.S., primarily due to Meta's failure to prevent U.S. intelligence agencies from accessing its data.
Additionally, a separate complaint filed by Schrems last year resulted in a substantial $1.3 billion fine under GDPR, putting the company at risk of being unable to transfer European personal data to its U.S. data centers. The last-minute approval of a third EU-U.S. data-sharing agreement provided a temporary solution.
In a different case concerning German antitrust law, the Court of Justice invalidated Meta's legal basis for targeted advertising, compelling the company to depend on user consent. In response, Meta attempted to coerce this consent by offering users a choice between agreeing to targeted advertising or paying a monthly fee. However, this tactic was dismissed by the EU's privacy regulators following a complaint from Schrems.
Meta's representative emphasized that the company does not utilize "special categories" of data, including sexual orientation, for the purpose of ad targeting.
“We also prohibit advertisers from sharing sensitive information in our terms and we filter out any potentially sensitive information that we’re able to detect. Further, we’ve taken steps to remove any advertiser targeting options based on topics perceived by users to be sensitive,” the spokesperson said.