Top Europe court rules against Meta Platforms on ad data retention

Europe’s top court has found against Meta Platforms (NASDAQ:META) over its approach to data retention in its continental ad business — a ruling set to add hurdles for social media names looking to garner European ad dollars.

The Court of Justice of the European Union found in favor of activist Max Schrems, who challenged Facebook Ireland on issues including harvesting data from the social platform indefinitely for targeted advertising.

The principle of data minimization in Europe’s General Data Protection Regulation “precludes any personal data obtained by a controller … from being aggregated, analyzed and processed for the purposes of targeted advertising without restriction as to time and without distinction as to type of data,” the CJEU found.

It also noted that the fact that a person made an otherwise public statement about their sexual orientation doesn’t authorize social networks to process other data tied to that person’s orientation for the purpose of personalized ads.

Meta (META) had responded that Schrems’ personal data was processed in accordance with its terms of use, which it says are compatible with the GDPR, and that the data use is not contingent on the user’s consent.

The news has particular import for Meta and ad-selling rivals (such as Google (GOOG) (GOOGL)) who have looked to leverage personal information into training artificial intelligence.

Running afoul of Europe’s GDPR can make a company liable for up to 4% of global annual revenue, which adds up to potential billions for tech giants.