Facebook (FB) Wins Lawsuit Against Belgium's Regulator

Facebook, Inc. (NASDAQ:FB) just won a big lawsuit against Belgium’s data protection authority. In 2015, the Belgian Privacy Commission had sued Facebook to prevent it from tracking information of non-users who visit Facebook’s public pages.

Back then a lower court had sided with the regulatory body and directed Facebook to stop tracking non users activities or cough up a hefty fine of €250K every day.

Expectedly, Facebook appealed against the ruling. The company also maintained that Irish Data Protection Commissioner had sole authority over it. Facebook’s European headquarters are located in Ireland.

However, Facebook temporarily discontinued the use of Datr cookies that are “placed on users’ browsers when they visit a Facebook.com site or click a Facebook 'Like' button on other websites, allowing it to track the online activities of that browser.”

Yesterday, in a big victory for Facebook, the regulatory body’s claim was rejected by the Brussels Appeals Court citing that "Belgian courts don't have international jurisdiction over Facebook Ireland, where the data concerning Europe is processed."

Facebook welcomed the ruling and said “we are pleased with the court’s decision and look forward to bringing all our services back online for people in Belgium.”

However, the Belgian privacy watchdog said that it was mulling filing a final appeal with the Court of Cassation. Notably, Cassation courts can’t deliver new judgments but have the authority to trash earlier rulings.

As Facebook hosts a huge amount of personal data, it has been under constant scrutiny from privacy groups and federal agencies. This huge database is its primary asset for attracting advertisers. As a result, the company has been criticized for allegedly selling this personal data to advertisers in order to boost its top line.

Although the company has denied any wrongdoing, we believe that increasing scrutiny by regulators of its data handling practices remains a major concern, going forward. Recently, the company ran into trouble with Brazilian law enforcement agencies involving its messaging service WhatsApp and in Germany over antitrust concerns.

At present, Facebook is a Zacks Rank #3 (Hold). Better-ranked stocks worth considering are NetEase, Inc. (NASDAQ:NTES) , Globant S.A. (NYSE:GLOB) and Paylocity Holding Corp. (NASDAQ:PCTY) . All of these sport a Zacks Rank #1 (Strong Buy).