European Data Protection Supervisor raises concerns around targeted advertising

By Francine Cunningham

03-2021

Targeted advertising and recommender systems have been highlighted as key concerns by the European Data Protection Supervisor (EDPS) in the context of the Commission's Digital Services package proposals. The EDPS, which is the EU's independent data protection authority, recently published two opinions: on the Digital Services Act (DSA) proposal and on the Digital Markets Act (DMA) proposal. These non-binding opinions were developed as part of the EDPS mission to ensure the protection of personal data and privacy.

While the EDPS welcomed both proposals, it pointed to the need for certain minimum standards for the largest tech companies with regard to the collection and transfer of data. Some key elements of the Supervisor's analysis are set out below.

Digital Services Act

The EDPS recommended additional safeguards, particularly in relation to content moderation, online targeted advertising and recommender systems used by online platforms, such as social media and online marketplaces.

The Supervisor welcomed the fact that the proposal does not impose a general monitoring obligation, or an obligation to take proactive measures to remove illegal content. According to the EDPS, the proposal confirms reasonable liability exemptions and supplements them with a pan-European system of notice and action rules. The EDPS underlined that any form of content moderation should take place in accordance with the rule of law. It recommended that profiling for the purpose of content moderation, which often includes processing of personal data, should be prohibited unless the online service provider can demonstrate that such measures are strictly necessary to address systemic risks. Such risks should also be explicitly identified in the Act itself.

Furthermore, the EDPS requested European legislators to consider a ban on online targeted advertising based on pervasive tracking. It also proposed to restrict the categories of data that can be processed for such advertising methods and the categories of data that may be disclosed to advertisers, or third parties, to enable or facilitate targeted advertising. As a minimum requirement, the EDPS called for more transparency of the criteria used to target advertisements.
These comments echo the European Parliament's initial views on the proposed DSA. On 20 October 2020, the Parliament's plenary adopted three resolutions (see here, here and here) providing insight into its eventual position on this issue. All three resolutions included a request for a stricter regulation of targeted advertising, possibly leading to a full prohibition of the practice.

Finally, with regards to recommender systems, the EDPS argued that they should refrain from profiling by default. The Supervisor also called for more transparency and user control of these systems.

Digital Markets Act

Achieving competitive digital markets and providing a greater choice of online platforms and services are inextricably linked, according to the EDPS. Supervisor Wojciech Wiewiórowski, said: “Competition, consumer protection and data protection law are three inextricably linked policy areas in the context of the online platform economy. Therefore, the relationship between these three areas should be one of complementarity, not friction.”

According to the EDPS, giving users better control over their personal data can reinforce contestability in digital markets. Therefore, the opinion includes specific recommendations to ensure the proposal is in line with General Data Protection Regulation rules. Additionally, the EDPS believes that increased interoperability can help to address user lock-in and ultimately create opportunities for services to offer better data protection. In this regard, the EDPS asks for European technical standards on interoperability to be applied to "gatekeeper" platforms.

To support a successful implementation of the Digital Services Act package, the EDPS called for a clear legal basis and a structure for closer cooperation between the relevant oversight authorities, including data protection authorities, consumer protection authorities and competition authorities. Finally, the EDPS requested its officials to be part of the Digital Markets Advisory Committee which would consist of national experts.

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