Staying Compliant: GDPR and ePrivacy Insights from Recent Rulings

In recent years, significant data privacy cases have emerged that highlight the critical importance of compliance with the General Data Protection Regulation (GDPR) and the ePrivacy Directive (ePD). Two notable cases from the past week—the Grindr case in Norway and the Meta Pixel case in Sweden—underscore the necessity of robust consent mechanisms. While these cases were adjudicated under GDPR, they also illustrate the requirements that would be enforced under the updated ePD Guidelines.

The Grindr Case in Norway

Violation Details:

Grindr was found to have shared sensitive user data, including users' sexual orientation, with third-party advertisers without obtaining proper consent. This practice was deemed a severe violation of user privacy under GDPR.

Consent Mechanism Issues:

The court highlighted that Grindr’s consent mechanism was insufficient. Users were not adequately informed about how their data would be used, and the consent obtained was not specific or unambiguous as required by GDPR.

Court’s Ruling:

The court affirmed the Data Protection Authority’s decision, emphasizing that Grindr’s approach to user consent did not meet GDPR standards. This ruling reinforces the necessity for digital services to have robust and transparent consent mechanisms.

Impact on Digital Services:

This decision is a critical reminder of the importance of compliance with data privacy laws. Companies must ensure that their consent mechanisms are clear, specific, and fully compliant with GDPR to avoid similar penalties.

The Meta Pixel Case in Sweden

Violation Details:

The Swedish Data Protection Authority (IMY) investigated Avanza Bank AB for their use of Meta's Pixel Tracker, which resulted in the unauthorized transfer of personal data to Meta. The data included personal identification numbers, loan amounts, and other sensitive information.

Regulatory Violations:

Avanza Bank was found to have violated Articles 5.1(f) and 32.1 of GDPR, which require appropriate technical and organizational measures to ensure data security. Which they did not have in place and thus failed to live up to their responsibilities.

Court’s Ruling:

The IMY imposed an administrative fine, highlighting the need for stringent compliance with GDPR requirements, especially concerning the use of tracking technologies. The Court stated that the ruling was in relation to GDPR and not to the ePrivacy Directive; but it seems obvious that the court has not been aware of Guidelines 02/2023 or it would never have been able to come to that conclusion considering how specific the Guidelines are compared to the more vague legal texts covered by GDPR in terms of tracking technologies.

Implications for ePrivacy Directive (ePD) Compliance

Both the Grindr and Meta Pixel cases, while adjudicated under GDPR, also highlight compliance issues that would fall under Article 5(3) of the ePrivacy Directive. Article 5(3) requires explicit and informed consent for the use of tracking technologies, such as cookies and pixels. The recent EDPB Guidelines 02/2023 further clarify these requirements, emphasizing:

• Informed Consent: Explicit and informed consent is mandatory for the use of tracking technologies.

• Transparency: Users must be informed about the purposes of data collection and their consent must be obtained before any data processing.

• First-Party Solutions: Companies should adopt first-party consent solutions to maintain compliance and enhance data security.

These cases underscore that the requirements for informed consent and transparency are already enforced under GDPR, and the ePD Guidelines provide an additional layer of clarity.

The Backlog of Cases

The Current Situation

There is a significant backlog of cases involving potential violations of data privacy regulations within the regulatory bodies of EU member states. Many of these cases date back to 2019 and 2020 and have been waiting for major precedent-setting rulings to move forward. With the recent landmark decisions in Sweden and Norway, we can expect these backlogged cases to be processed more rapidly under a stronger GDPR enforcement framework and the updated Guidelines 02/2023 from ePD.

Implications for Website Owners and the Industry

Increased Enforcement and Fines

With the recent rulings under GDPR and the new ePD Guidelines, regulatory authorities are expected to impose substantial fines for violations. Website owners who have not adhered to the strict consent requirements of GDPR and ePD may find themselves facing significant financial penalties.

The historical nature of these cases means that businesses could be fined for abuses that have occurred as far back as 2019. This retroactive enforcement will underscore the importance of ongoing compliance and proactive data privacy measures.

Reevaluation of Data Practices

Businesses will need to reevaluate their data collection and processing practices to ensure they are fully compliant with both GDPR and ePD requirements. This includes implementing robust consent mechanisms, regularly auditing data practices, and transitioning to first-party data solutions.

Companies that have relied heavily on third-party trackers and data processors will need to reassess these relationships and ensure that all data collection is based on explicit, informed consent.

Heightened Scrutiny on Third-Party Providers

The backlog of cases will bring increased scrutiny on third-party SaaS providers that offer consent management, analytics, and marketing solutions. Businesses using these services must ensure their providers are compliant with GDPR and ePD standards to avoid indirect liability.

This scrutiny will likely lead to a shift towards first-party consent solutions, which offer greater control and transparency over data collection and processing.

Impact on Marketing and Analytics Strategies

The enforcement of ePD Guidelines will necessitate changes in how businesses approach marketing and analytics. Companies will need to ensure that all tracking technologies, including cookies and beacons, are used in compliance with consent requirements.

This shift may impact the effectiveness of certain marketing strategies that rely on third-party data, pushing businesses to develop more transparent and user-friendly consent mechanisms.

Legal and Reputational Risks

Non-compliance with GDPR and ePD can result in not only financial penalties but also significant reputational damage. Businesses found in violation may suffer from a loss of customer trust and loyalty, which can have long-term impacts on their brand.

The visibility of these cases, especially as they are processed and publicized, will serve as a warning to other companies about the importance of stringent data privacy practices.

DMA Impact for Big Players

For major players, the Digital Markets Act (DMA) adds another layer of compliance requirements. The combination of GDPR, ePD, and DMA enforcement will create a challenging regulatory environment for BigTech companies, especially those relying on complex consent models and extensive data collection practices.?

Read more about how the “Commission sends preliminary findings to Meta over its “Pay or Consent” model for breach of the Digital Markets Act” here.

Preparing for the Future

Given the expected increase in enforcement actions and the processing of the backlog of cases dating back from 2019, businesses must take proactive steps to align with GDPR and ePD requirements, and as a Bigger Player also the DMA:

Implement Transparent Consent Mechanisms

Ensure that consent mechanisms are clear, accessible, and fully compliant with GDPR and ePrivacy Directive standards. This involves detailed disclosures about data collection practices and obtaining explicit user consent before any data processing occurs.

Adopt a First-Party Data Strategy

Transition from third-party data collection to first-party solutions. This approach not only mitigates legal risks but also provides better control over data quality and security.

Utilize Privacy-Enhancing Technologies

Leverage technologies that enhance user privacy and comply with regulatory standards. Solutions like AesirX offer tools that facilitate this transition and ensure ongoing compliance.

Conduct Regular Privacy Audits

Regularly audit your data practices to ensure ongoing compliance with GDPR and the ePrivacy Directive. This includes reviewing consent mechanisms and data handling processes.

Educate and Train Your Team

Ensure that your team understands the importance of privacy compliance and the technical requirements to maintain it. Access to real-time privacy and monitoring tools can help keep your team informed and proactive.

Consent is Required!

The Grindr and Meta Pixel cases illustrate the importance of robust, transparent consent mechanisms under GDPR. With the adoption of ePD Guidelines 02/2023 and the Digital Markets Act, the enforcement landscape is even clearer. Businesses must adopt first-party consent solutions to ensure compliance, as relying on third-party processors without proper consent is increasingly untenable.

We will be updating our comparison chart for selected Analytics / Consent solution providers to highlight non-compliance among competitors using Pixel Trackers, Beacons, and third-party data sharing without due first-party based consent. These practices are illegal under GDPR, ePD, and DMA, underscoring the critical need for compliant data handling solutions like we offer in our Open Source and Free AesirX First-Party Foundation.

Ensure your business complies with GDPR, ePD, and DMA by adopting robust consent management practices. Contact us today to schedule a Web-Facing Privacy Review and protect your business while building trust with your users or start by scanning your website or e-commerce solutions with our free Privacy Scanner.

Ronni K. Gothard Christiansen // VikingTechGuy

Creator, AesirX.io

Read more about ePD Framework: “Understanding the ePrivacy Framework: Directive, Guidelines, and Regulation”

About the AesirX Privacy Scanner:?

The AesirX Privacy Scanner is a powerful tool designed to ensure that websites comply with the stringent requirements of the ePrivacy Directive and GDPR. Using the EU's EDPS (European Data Protection Supervisor) Inspection Tool, the AesirX Privacy Scanner conducts thorough scans of websites to identify non-compliant elements, including cookies, trackers, and beacons.?

AesirX also offers a free Privacy Advisor AI Assistant that helps to explain the scanned results from the EDPS Inspection Tool and offers concrete recommendations on what is needed to resolve compliance issues found in the scan result.