Facebook Wins Ruling Cutting Hamburg Data Regulator's Powers

Facebook Inc. scored a victory in its battle against German privacy regulators who claim they can regulate the social network's policies.

A Hamburg court halted enforcement of an order by the city's data watchdog who had told Facebook to allow users to sign up to the social network under a pseudonym. German law doesn't apply to Facebook's privacy policy, as its European headquarters are in Ireland, the court said in a preliminary ruling.

The applicable law is that "of the European Union member state that is most closely related to the data processing at stake," the court said. "As to the real-name rule, this is Facebook's Ireland branch."

Hamburg's data regulator Johannes Caspar and other German privacy watchdogs have been fighting with Facebook for years over the implementation of European data-protection rules. The US company has argued that only the Irish regulator has jurisdiction over its compliance with EU privacy law.

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Germany's top administrative court last week sent a related case to the EU's top court and asked for guidance which law applies in these cases.

Caspar can appeal Thursday's ruling. His office didn't immediately reply to an email seeking comment.

The order was based on a complaint by a user who'd sought to prevent her private Facebook account from being used by people wishing to contact her about business matters. Facebook changed the profile to her real name against her will and asked for a digital copy of her identity card or passport.

The court decision comes the day after Germany's antitrust regulator said it's examining whether Facebook abused its possible market dominance by forcing customers to agree to terms allowing the use of their data.

© 2016 Bloomberg L.P.