CJEU - C‑383/23 - Anklagemyndigheden v ILVA A/S
| CJEU - C‑383/23 Anklagemyndigheden v ILVA A/S | |
|---|---|
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| Court: | CJEU |
| Jurisdiction: | European Union |
| Relevant Law: | Article 83(4) GDPR Article 83(6) GDPR |
| Decided: | |
| Parties: | ILVA A/S |
| Case Number/Name: | C‑383/23 Anklagemyndigheden v ILVA A/S |
| European Case Law Identifier: | ECLI:EU:C:2024:752 |
| Reference from: | Vestre Landsret (Denmark) |
| Language: | 24 EU Languages |
| Original Source: | AG Opinion |
| Initial Contributor: | wp |
The Advocate General opined that an undertaking under Article 83 GDPR encompasses the entity engaged in an economic activity, within the meaning of Articles 101 and 102 TFEU. While the undertaking’s turnover sets the maximum amount of the fine, the actual fine should reflect all relevant facts of the case.
English Summary
Facts
ILVA is a company operating a chain of furniture shops in Denmark (the controller). The controller violated Article 5(1)(e) GDPR, Article 5(2) GDPR and Article 6 GDPR regarding the retention of former customers’ personal data. For this violations the Danish DPA (Datatilsynet) advised the public prosecutor to impose a fine of €201,000. The controller was a part of the Lars Larsen Group. Hence, the calculation of the fine was based on the group’s turnover.
The Aarhus District Court (Retten i Aarhus) found the controller guilty. However, the fine was lowered to €13,400, since it was the controller, not the group, who violated the GDPR.
The public prosecutor appealed against the aforementioned judgement before High Court of Western Denmark (Vestre Landsret). The High Court of Western Denmark stayed the proceedings and referred the following questions to the CJEU for a preliminary ruling:
1) Must the term “undertaking” in Article 83(4) to (6) GDPR be understood as an undertaking within the meaning of Articles 101 and 102 TFEU, in conjunction with recital 150 of that regulation, and the case-law of the [Court of Justice] [on] EU competition law, so that the term “undertaking” covers any entity engaged in an economic activity, regardless of that entity’s legal status and the way in which it is financed?
2) If the answer to Question 1 is in the affirmative, must Article 83(4) to (6) GDPR be interpreted as meaning that, when imposing a fine on an undertaking, regard must be had to the total worldwide annual turnover of the economic entity of which the undertaking forms part, or only the total worldwide annual turnover of the undertaking itself?
Advocate General Opinion
On 12 September Advocate General Medina issued his opinion.
At the beginning, the AG explained that within Danish legal system the DPA has no powers to impose fines. The DPA has to report the case with the police, who investigates the case and when necessary initiates the proceedings before a court.
Further, the AG decided to examine both questions together.
The AG emphasised that the notion of “undertaking” has been recently interpreted by the CJEU in case C-807/21 Deutsche Wohnen. According to the CJEU, the undertaking should be understood in line with EU competition law and Article 101 and Article 102 TFEU. In particular, it is “entity engaged in an economic activity”, no matter its legal form. When it comes to calculations of a fine, it is the undertaking turnover that should be its basis.
In the case at hand, the AG drew the attention to the influence of the parent company on the companies within the group. That influence, as defined in the CJEU case law, amounts, for example, to appointing members of boards of directors or calling shareholders meetings. If the parent company “exercise decisive influence” over the controller, then the undertaking under Article 83(5) GDPR would consist of: 1) the controller, 2) the parent company, 3) other companies under decisive influence of the parent company.
Consequently, the group turnover would form a baseline for the calculation of maximum fine.
Nevertheless, the AG pointed out the rules to calculate the maximum fine applicable don’t have to be applied as “the main or only reference for setting the actual fine”. This is because the actual fine should reflect all facts of the case, including all aggravating and extenuating circumstances. The AG underlined that one of relevant circumstance is the role of members of undertaking in violation committed.
Additionally, the AG suggested that guarantees of fair criminal proceedings has to be followed as well. Especially, the principle of proportionality must be observed.
In conclusion, the AG suggested to consider the following when using the concept of the undertaking in order to determine the amount of the actual fine under Article 83 GDPR:
“First, it should be evaluated whether the parent company has exercised its decision-making power with respect to specific activities of the controller or the processor at issue in the GDPR infringement(s). Second, it needs to be considered whether specific data processing infringing the GDPR relates to the company concerned and/or to the whole group. Third, it is necessary to establish whether more than one company forming part of the group was involved in the GDPR infringement(s).”
Holding
The judgement has not been issued yet.
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