Contract Law in the Age of Big Data

Abstract

We are living in a data era where data drives everything we do, including businesses. In data-driven business models, users’ personal data is collected in order to determine consumer preferences and to tailor production and advertising to these preferences. In these new business models, consumers do not pay a price but provide their data, such as IP numbers, locations, and email addresses in order to benefit from digital service or digital content. Content or service providers and users have something in common in these “free” business models which is to benefit from each other. Users benefit from the content or service but they provide their personal data and/or they are exposed to advertisements in return.

This legal framework and trade cannot be made without taking contract law into consideration. Contracts naturally facilitate interactions between companies and users. Their transactions are regulated by contracts in which their agreement on data use and data processing are stipulated. In the last two to three decades, in particular, personal data has started to function similar to the functionality of money in synallagmatic transactions. In this vein, it goes without saying that the role of contract law is becoming more significant and complicated because it does not only concern the economic ordering and economic transactions anymore but also as it is personal data, data protection law comes into play which is considered a part of fundamental rights protection. Data is always collected and processed through a contractual relationship and in this paper, I will argue that there are problems arising from contracts involving data to which contract law applies and that contract law can map these problems and offer insights. The scope of this study will be limited to issues where data is provided as counter-performance and where data is provided in addition to a monetary payment.

Keywords: Contract Law, Specific Contracts, Data Protection, Privacy, Big Data