In a significant blow to Meta's advertising practices, the European Union's top court has ruled that the tech giant cannot use data related to users' sexual orientation for targeted advertising, even if that information is publicly disclosed. This decision marks another victory for privacy activist Max Schrems in his ongoing legal battles against the company.
The Court of Justice of the European Union (CJEU) handed down its ruling on Friday, emphasizing the principle of data minimization enshrined in the EU's General Data Protection Regulation (GDPR). This ruling has far-reaching implications for Meta and other online advertisers operating in the EU.
Key points from the court's decision:
- Meta cannot use all of a user's data indefinitely for ad targeting purposes.
- Sexual orientation data, considered sensitive under GDPR, cannot be used for advertising, even if publicly disclosed by the user.
- The company must limit the data it uses for advertising more broadly, setting new ground rules for GDPR enforcement.
This latest legal challenge originated from Schrems' complaint about seeing ads on Meta platforms that appeared to target his sexual orientation, despite not disclosing this information on his Facebook profile. Schrems argued that Meta deduced his sexuality from off-platform activities, such as app logins and website visits.
The ruling is expected to have significant ramifications for Meta's advertising business in Europe. Katharine Raabe-Stuppnig, the lawyer representing Schrems, stated, 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.
Meta has invested over €5 billion ($5.5 billion) in privacy measures and maintains that it does not use special categories of data, including sexuality, for ad targeting. However, this ruling adds to a series of legal setbacks for the company in the EU, including:
- A $1.3 billion GDPR fine last year
- Rejection of Meta's attempt to force users to consent to targeted ads or pay a fee
- Previous rulings that invalidated EU-U.S. data-sharing agreements
As the tech industry grapples with increasing privacy regulations, this decision sets a precedent that could reshape online advertising practices across the European Union. It remains to be seen how Meta and other tech companies will adapt their strategies to comply with these stricter data usage limitations.