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Social networking big boys must bow to EU data laws

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Social networking sites are legally responsible for their users' privacy, Europe's privacy watchdogs have confirmed. A committee of data protection regulators has said that the sites are 'data controllers', with all the legal obligations that brings.

Users of the sites are also data controllers with legal obligations when they are posting on behalf of a club, society or company, the opinion said.

The committee of Europe's data protection regulators, the Article 29 Working Party, has published its opinion on the legal status of social networking operators such as Facebook and MySpace.

It has said that the sites cannot escape their legal obligations just because content on them is often produced and posted by users.

"SNS [Social Network Service] providers are data controllers under the Data Protection Directive," it said. "They provide the means for the processing of user data and provide all the 'basic' services related to user management (e.g. registration and deletion of accounts). SNS providers also determine the use that may be made of user data for advertising and marketing purposes – including advertising provided by third parties."

Being a data controller under data protection legislation brings with it greater legal responsibilities than being a data processor. The opinion said that social networking companies count as data controllers under EU law "even when their headquarters are outside of the [European Economic Area]".

The opinion said that users of social networking sites could also attract the same legal obligations, but only if they were acting on behalf of a company, association or in pursuit of commercial, political or charitable goals.

The opinion also outlines the obligations of people who count as data processors. They must be clear about their identity, must offer privacy-friendly default settings to any service they offer, should provide users with privacy warnings and should give warnings to users about the potential privacy implications of their actions.

According to privacy law expert William Malcolm the opinion offers clarity for companies and users, but should not contain surprises for followers of data protection law.

"This finally puts to bed the argument that social networking sites might not be data controllers and therefore might not be subject to the Data Protection Directive and its local implementing legislation," he said. "This restates some of the previously defined positions in relation to privacy issues affecting social networking sites."

The opinion makes it clear that users of social networking sites have no legal obligations as data controllers as long as the use is purely personal.

"The Directive does not impose the duties of a data controller on an individual who processes personal data 'in the course of a purely personal or household activity'," it said, citing the 'household exemption' to the provisions of the Directive.

Individuals will have those responsibilities if their use extends beyond the personal, it said, quoting EU Information Society Commissioner Viviane Reding's view that use is shifting from "web 2.0 for fun [to] web 2.0 for productivity and services".

"The activities of some SNS users may extend beyond a purely personal or household activity, for example when the SNS (social networking site) is used as a collaboration platform for an association or a company," said the opinion. "If an SNS user acts on behalf of a company or association, or uses the SNS mainly as a platform to advance commercial, political or charitable goals, the exception does not apply. Here, the user assumes the full responsibilities of a data controller who is disclosing personal data to another data controller (SNS) and to third parties."

See: The opinion (13-pg/89kb pdf)

Copyright © 2009, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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