US FTC continues Facebook privacy and competition probes

The US FTC continues its investigations of Facebook relating to both privacy and competition issues.

The FTC has undertaken several investigations of Facebook's privacy practices, and has notably entered into a consent decree in 2012 requiring Facebook to gain more explicit consent from users before sharing their data. Over the past year, in the wake of allegations that Facebook sold user information to data firm Cambridge Analytica, the FTC has been conducting a new investigation into Facebook's current privacy practices and whether they run afoul of the consent decree. While the agency has been criticised by some in recent months for the seemingly slow pace of this inquiry, various news sources have recently reported that the FTC is seeking a "record-setting fine" of up to US $5 billion, and may require adherence to new, more stringent privacy rules.

In addition to data privacy investigations, the FTC in February launched a task force to monitor competition in technology markets and review past mergers. In recent weeks, the FTC and the US DoJ reached an agreement that the DoJ would, if it deemed necessary, undertake antitrust probes of Apple and Google, while the FTC would have jurisdiction to look into Amazon and Facebook. Both the FTC and the DOJ have the authority to enforce US antitrust laws, and the agencies typically agree on which one will investigate specific companies. Both agencies generally refrain from commenting on non-public investigations such as the ones detailed here. For its part, in June 2019, the DOJ stated that the agency was equipped under existing law to combat anticompetitive activity in the digital economy, specifically referencing activities such as collusion, exclusivity and tying arrangements, and the acquisition of nascent competitors.

In the US Congress, the House Judiciary Committee Subcommittee on Antitrust, Commercial and Administrative Law has recently announced a series of hearings on competition in digital markets, promising a "top-to-bottom review of the market power held by tech giant platforms." On 21 June, seven US Senators asked the Trump Administration to disclose details of possible FTC and DOJ antitrust investigations into Facebook, Amazon, Alphabet (Google), and Apple. News reports have also indicated that the FTC is directly contacting smaller technology companies to collect reports of anticompetitive conduct and harm caused by tech mergers.

While the current investigations into the big tech companies' use of consumer data focuses on antitrust law, one outcome of the increased legislative and enforcement activity in 2019 may be the passage of a national data privacy and security law comparable in scope to the European Union's GDPR. Significantly, at a hearing before Congress in May 2019, FTC Commissioners renewed their support for a national data privacy and security act at the federal level, to be enforced by the FTC. They had previously expressed unanimous support for a federal data privacy law in hearings before the Senate in November 2018.