CJEU’s AG Bot referred to the GDPR in his recent ‘right to be forgotten’ Opinion
It may only become applicable on 25 May 2018, but the GDPR already made its official debut in the case-law of the CJEU.
It was the last paragraph (§101) of the Conclusions of AG Bot in Case C-398/15 Manni, published on 8 September, that specifically referred to Regulation 2016/679 (the official name of the GDPR). The case concerns the question of whether the right to erasure (the accurate name of the more famous “right to be forgotten”) as enshrined in Article 12 of Directive 95/46 also applies in the case of personal data of entrepreneurs recorded in the Public Registry of companies, if their organisation went bankrupt years ago. Curiously, the preliminary ruling question doesn’t specifically refer to the right to erasure, but to the obligation in Article 6(1)(e) for controllers not to retain the data longer than necessary to achieve the purpose for which they were collected.
In fact, Mr Manni had requested his regional Chamber of Commerce to erase his personal data from the Public Registry of Companies, after he found out that he was losing clients who performed background checks on him through a private company that specialised in finding information in the Public Registry. This happened because Mr Manni had been an administrator of a company that was declared bankrupt more than 10 years before the facts in the main proceedings. In fact, the former company itself was radiated from the Public Registry (§30).
Disclaimer! The Opinion is not yet available in English, but in another handful of official languages of the EU. Therefore, the following quotes are all my translation from French or Romanian.
AG Bot advised the Court to reply to the preliminary ruling questions in the sense that all personal data in the Public Registry of companies should be retained there indefinitely, irrespective of the fact that companies to whose administrators the data refer are still active or not. “Public Registries of companies cannot achieve their main purpose, namely the consolidation of legal certainty by disclosing, in accordance with the transparency principle, legally accurate information, if access to this information would not be allowed indefinitely to all third parties” (§98).
The AG adds that “the choice of natural persons to get involved in the economic life through a commercial company implies a permanent requirement of transparency. For this main reason, detailed throughout the Opinion, I consider that the interference in the the right to the protection of personal data that are registered in a Public Registry of companies, specifically ensuring their publicity for an indefinite period of time and aimed towards any person who asks for access to these data, is justified by the preponderant interest of third parties to access those data” (§100).
Restricting the circle of ‘interested third parties’ would be incompatible with the purpose of the Public Registry
Before reaching this conclusion, the AG dismissed a proposal by the Commission that suggested a limited access to the personal data of administrators of bankrupt companies could be ensured only for those third parties that “show a legitimate interest” in obtaining it.
The AG considered that this suggestion “cannot, at this stage of development of EU law, ensure a fair balance between the objective of protecting third parties and the right to the protection of personal data registered in Public Registries of companies” (§87). In this regard, he recalled that the objective to protect the interest of third parties as enshrined in the First Council Directive 68/151 “is provided for in a sufficiently wide manner so as to encompass not only the creditors of a company, but also, in general, all persons that want to obtain information regarding that company” (§88).
Earlier, the AG had also found that the suggestion to anonymise data regarding the administrators of bankrupt companies is not compatible with the historical function of the Public Registry and with the objective to protect third parties that is inherent to such registries. “The objective to establish a full picture of a bankrupt company is incompatible with processing anonymous data” (§78).
Throughout the Opinion, the AG mainly interprets the principles underpinning the First Council Directive 68/151/EC (of 9 March 1968 on co-ordination of safeguards which, for the protection of the interests of members and others, are required by Member States of companies within the meaning of the second paragraph of Article 58 of the Treaty, with a view to making such safeguards equivalent throughout the Community) and it is apparent that it enjoys precedence over Directive 95/46/EC.
Finally: the reference to the GDPR
The AG never refers in his analysis to Article 12 of Directive 95/46, which grants data subjects the right to erasure. However, come the last paragraph of the Opinion, the AG does refer to Article 17(3)(b) and (d) from Regulation (EU) 2016/679 (yes, the GDPR). He applies Article 17 GDPR to the facts of the case and mentions that the preceding analysis “is compatible” with it, because “this Article provides that the right to erasure of personal data, or ‘the right to be forgotten’, does not apply to a processing operation ‘for compliance with a legal obligation which requires processing by Union or Member State law to which the controller is subject or for the performance of a task carried out in the public interest or in the exercise of official authority vested in the controller’ or ‘for archiving purposes in the public interest'” (§101).
While I find the Opinion of the AG clear and well argued, I have two comments. I wish he had referred more comprehensively to the fundamental rights aspect of the case when balancing the provisions of the two directives. But most of all, I wish he would have analysed the right to erasure itself, the conditions that trigger it and the exemptions under Article 13 of Directive 95/46.
My bet on the outcome of the case: the Court will follow the AG’s Opinion to a large extent. However, it may be more focused on the fundamental rights aspect of balancing the two Directives and it may actually analyse the content of the right to erasure and its exceptions. The outcome, however, is likely to be the same.
A small thing that bugs me about this case is that I find there is a differentiation between searching a Registry of Companies being interested in a company name and searching a Registry of Companies being interested in a specific natural person. I mean, all third parties may very well be interested in finding out everything there is to know about bankrupt Company X, discovering thus that Mr Manni was the administrator. To me, this does not seem to be the same situation as searching the Public Registry of companies using Mr Manni’s name to find out all about Mr Manni’s background. In §88 the AG even mentions, when recognising the all encompassing interest of every third party to access all information about a certain company indefinitely, that Directive 68/151 protects the interest of “all persons that want to obtain information regarding this company“. I know the case is about keeping or deleting the personal data of Mr Manni from the Registry. And ultimately it is important to keep the information there due to the general interest of knowing everything about the history of a company. However, does it make any difference for the lawfulness of certain processing operations related to the data in the Registry that the Registry of companies is used to create profiles of natural persons? I don’t know. But it’s something that bugged me while reading the Opinion. Moreover, if you compare this situation to the “clean slate” rules for certain offenders that have their data erased from the criminal record, it is even more bugging. (Note: at §34 the AG specifies he is only referring in his Opinion to the processing of personal data by the Chamber of Commerce and not by private companies specialising in providing background information about entrepreneurs).
Fun fact #1
The GDPR made its ‘unofficial’ debut in the case-law of the CJEU in the Opinion of AG Jaaskinen in C-131/14 Google v. Spain delivered on 25 June 2013. In fact, it was precisely Article 17 that was referred to in this Opinion as well, in §110. There’s another reference to the GDPR in §56, mentioning the new rules on the field of application of EU data protection law. Back then, the text of the GDPR was merely a proposal of the Commission – nor the EP, or the Council had adopted their own versions of the text, before entering the trilogue which resulted in the adopted text of Regulation 2016/679.
Fun fact #2
AG Bot is the AG that the delivered the Opinion in the Schrems case as well. The Court followed his Opinion to a large extent for its Judgment. There are fair chances the Court will follow again his Opinion.
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CJEU in Manni: data subjects do not have the right to obtain erasure from the Companies Register, but they do have the right to object
by Gabriela Zanfir-Fortuna
The recent judgment of the CJEU in Case C-398/15 Manni (9 March 2017) brings a couple of significant points to the EU data protection case-law:
This commentary will highlight all points enumerated above.
1. Facts of the case
Mr Manni had requested his regional Chamber of Commerce to erase his personal data from the Public Registry of Companies, after he found out that he was losing clients who performed background checks on him through a private company that specialised in finding information in the Public Registry. This happened because Mr Manni had been an administrator of a company that was declared bankrupt more than 10 years before the facts in the main proceedings. In fact, the former company itself was radiated from the Public Registry (§23 to §29).
2. The question in Manni
The question that the CJEU had to answer in Manni was whether the obligation of Member States to keep public Companies Registers and the requirement that personal data must be kept in a form which permits identification of data subjects for no longer than is necessary for the purposes for which the data were collected must be interpreted as meaning that individuals must be allowed to “request the authority responsible for maintaining the Companies Register to limit, after a certain period has elapsed from the dissolution of the company concerned and on the basis of a case-by-case assessment, access to personal data concerning them and entered in that register” (§30).
3. Applicability of Directive 95/46 (Data Protection Directive – ‘DPD’)
First, CJEU clarified that its analysis does not concern processing of data by the specialized rating company, and it only refers to the obligations of the public authority keeping the companies register (§31). Second, the CJEU ascertained that the provisions of the DPD are applicable in this case:
4. The role of the data quality principles and the legitimate grounds for processing in ensuring a high level of protection of fundamental rights
Further, CJEU recalls its case-law stating that the DPD “seeks to ensure a high level of protection of the fundamental rights and freedoms of natural persons” (§37) and that the provisions of the DPD “must necessarily be interpreted in the light of the fundamental rights guaranteed by the Charter”, and especially Articles 7 – respect for private life and 8 – protection of personal data (§39). The Court recalls the content of Articles 7 and 8 and specifically lays out that the requirements under Article 8 Charter “are implemented inter alia in Articles 6, 7, 12, 14 and 28 of Directive 95/46” (§40).
The Court highlights the significance of the data quality principles and the legitimate grounds for processing under the DPD in the context of ensuring a high level of protection of fundamental rights:
The Court applies this test in reverse order, which is, indeed, more logical. A processing activity should, first, be legitimate under one of the lawful grounds for processing and only after ascertaining that this is the case, the question of compliance with the data quality principles should arise.
CJEU finds that in the case at hand the processing activity is legitimized by three lawful grounds (§42, §43):
5. The link between the data retention principle, the right to erasure and the right to object
Article 6(1)(e) of the DPD requires that personal data are kept in a form which permits identification of data subjects for no longer than what is necessary for the purposes for which the data were collected or for which they are further processed. This means that controllers should only retain personal data up until it serves the purpose for which it was processed and automatically anonymise, erase or otherwise make unavailable that data. If the controller does not comply with this obligation, the data subject has two possible avenues to stop the processing: he/she can either ask for erasure of that data, or they can object to the processing based on their particular situation and a justified objection.
CJEU explains that “in the event of failure to comply with the condition laid down in Article 6(1)(e)” of the DPD, “Member States guarantee the person concerned, pursuant to Article 12(b) thereof, the right to obtain from the controller, as appropriate, the erasure or blocking of the data concerned” (§46 and C-131/12 Google/Spain §70).
In addition, the Court explains, Member States also must “grant the data subject the right, inter alia in the cases referred to in Article 7(e) and (f) of that directive, to object at any time on compelling legitimate grounds relating to his particular situation to the processing of data relating to him, save where otherwise provided by national legislation”, pursuant to Article 14(a) DPD (§47).
The CJEU further explains that “the balancing to be carried out under subparagraph (a) of the first paragraph of Article 14 … enables account to be taken in a more specific manner of all the circumstances surrounding the data subject’s particular situation. Where there is a justified objection, the processing instigated by the controller may no longer involve those data” (§47).
6. The pivotal role of the purpose of the processing activity in granting the right to erasure and the right to object
After establishing these general rules, the Court decides that in order to establish where data subjects have the “right to apply to the authority responsible for keeping the register to erase or block the personal data entered in that register after a certain period of time, or to restrict access to it, it is first necessary to ascertain the purpose of that registration” (§48).
The pivotal role of the purpose of the processing operation should not come as a surprise, given the fact that the data retention principle is tightly linked to accomplishing the purpose of the processing operation.
In this case, the Court looked closely at Directive 68/151 and explained at length that the purpose of the disclosure provided for by it is “to protect in particular the interests of third parties in relation to joint stock companies and limited liability companies, since the only safeguards they offer to third parties are their assets” (§49) and “to guarantee legal certainty in relation to dealings between companies and third parties in view of the intensification of trade between Member States” (§50). CJEU also referred to primary EU law, and specifically to Article 54(3)(g) EEC, one of the legal bases of the directive, which “refers to the need to protect the interests of third parties generally, without distinguishing or excluding any categories falling within the ambit of that term” (§51).
The Court further noted that Directive 68/151 makes no express provision regarding the necessity of keeping personal data in the Companies Register “also after the activity has ceased and the company concerned has been dissolved” (§52). However, the Court notes that “it is common ground that even after the dissolution of a company, rights and legal relations relating to it continue to exist” (§53) and “questions requiring such data may arise for many years after a company has ceased to exist” (§54).
Finally, CJEU declared:
7. Conclusion A: there is no right to erasure
The Court concluded that “in those circumstances” the data retention principle in Article 6(1)(e) DPD and the right to erasure in Article 12(b) DPD do not guarantee for the data subjects referred to in Directive 68/151 a right to obtain “as a matter of principle, after a certain period of time from the dissolution of the company concerned, the erasure of personal data concerning them” (§56).
After already reaching this conclusion, the Court also explained that this interpretation of the provisions in question does not result in “disproportionate interference with the fundamental rights of the persons concerned, and particularly their right to respect for private life and their right to protection of personal data as guaranteed by Articles 7 and 8 of the Charter” (§57).
To this end, the Court took into account:
8. Conclusion B: but there is a right to object
After acknowledging that, in principle, the need to protect the interests of third parties in relation to joint-stock companies and limited liability companies and to ensure legal certainty, fair trading and thus the proper functioning of the internal market take precedence over the right of the data subject to object under Article 14 DPD, the Court points out that
“it cannot be excluded, however, that there may be specific situations in which the overriding and legitimate reasons relating to the specific case of the person concerned justify exceptionally that access to personal data entered in the register is limited, upon expiry of a sufficiently long period after the dissolution of the company in question, to third parties who can demonstrate a specific interest in their consultation” (§60).
While the Court leaves it to the national courts to assess each case “having regard to all the relevant circumstances and taking into account the time elapsed since the dissolution of the company concerned”, it also points out that, in the case of Mr Manni, “the mere fact that, allegedly, the properties of a tourist complex built … do not sell because of the fact that potential purchasers of those properties have access to that data in the company register, cannot be regarded as constituting such a reason, in particular in view of the legitimate interest of those purchasers in having that information” (§63).
9. Post Scriptum
The Court took a very pragmatic approach in dealing with the case of Mr Manni. The principles of interpretation it laid down are solid – such an analysis indeed requires looking at the legitimate grounds for processing and the relevant data quality principle. Having the Court placing strong emphasis on the significance of the purpose of the processing activity is welcome, just like having more guidance on the balancing exercise of the rights and interests in question. In addition, a separate assessment of the right to obtain erasure and of the right to object is very helpful with a view towards the future – the full entering into force of the GDPR and its heightened rights of the data subject.
The aspect of the judgment that leaves some room for improvement is analysing the proportionality of the interference of the virtually unlimited publishing of personal data in the Companies Register with Articles 7 and 8 of the Charter. The Court does tackle this, but lightly – and it brings two arguments only after already declaring that the interference is not disproportionate. Moreover, the Court does not distinguish between interferences with Article 7 and interferences with Article 8.
Finally, I was happy to see that the predicted outcome of the case, as announced in the pdpEcho commentary on the Opinion of the Advocate General Bot, proved to be mainly correct: “the Court will follow the AG’s Opinion to a large extent. However, it may be more focused on the fundamental rights aspect of balancing the two Directives and it may actually analyse the content of the right to erasure and its exceptions. The outcome, however, is likely to be the same.”
Suggested citation: G. Zanfir-Fortuna, “CJEU in Manni: data subjects do not have the right to obtain erasure from the Companies Register, but they do have the right to object”, pdpEcho.com, 13 March 2017.
 Article 3 of Directive 68/151.
 Article 6(1)(e) of Directive 95/46.
 Article 2(a) of Directive 95/46.
 Article 2(d) of Directive 95/46.
 Article 2(b) of Directive 95/46.
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Posted in CJEU case-law, Comments, Europe, News
Tagged C-398/15 Manni, Chamber of Commerce, CJEU, commentary Manny case, Companies Register, data protection, data retention, Gabriela Zanfir-Fortuna, manni, pdpecho Manni, pedpecho, purpose of processing, right to be forgotten, right to erasure, right to object, RTBF