Facebook Inc. was ordered to stop collecting German users’ data from its WhatsApp unit, after a regulator in the nation said the company’s attempt to make users agree to the practice in its updated terms isn’t legal.
Johannes Caspar, who heads Hamburg’s privacy authority, issued a three-month emergency ban, prohibiting Facebook from continuing with the data collection. He also asked a panel of European Union data regulators to take action and issue a ruling across the 27-nation bloc. The new WhatsApp terms enabling the data scoop are invalid because they are intransparent, inconsistent and overly broad, he said.
“The order aims to secure the rights and freedoms of millions of users which are agreeing to the terms Germany-wide,” Caspar said in a statement on Tuesday. “We need to prevent damage and disadvantages linked to such a black-box-procedure.”
The order strikes at the heart of Facebook’s business model and advertising strategy. It echoes a similar and contested step by Germany’s antitrust office attacking the network’s habit of collecting data about what users do online and merging the information with their Facebook profiles. That trove of information allows ads to be tailored to individual users — creating a cash cow for Facebook.
Facebook’s WhatsApp unit called Caspar’s claims “wrong” and said the order won’t stop the roll-out of the new terms. The regulator’s action is “based on a fundamental misunderstanding” of the update’s purpose and effect, the company said in an emailed statement.
The U.S. tech giant has faced global criticism over the new terms that WhatsApp users are required to accept by May 15. Caspar said Facebook may already be wrongfully handling data and said it’s important to prevent misuse of the information to influence the German national election in September.