Information as a new currency

In the digital space, information is the new currency. If you make a search query "app sells data", Google will offer you 4 and a half billion pages. More and more new services are appearing to process content, entire industries are forming to support information exchange. The risks of illegal use of information are also increasing. Opposing interests clash - business interests focused on gaining profit from the use and sale of information and individual interests based on constitutional values such as inviolability of private life and prohibition to collect information about personal life without the consent of the data subject (Articles 23, 24 of the Russian Federation Constitution).

The confrontation is concentrated in the sphere of personal data. Deprived of legal tools, commercial organizations collect and sell massive amounts of data illegally. Moreover, trade in information fits into the general commodification trend in which intangible goods, such as virginity, organs, information about one's personal life and knowledge, are monetized. There seem to be no obstacles to the legalization of personal data trafficking. Moreover, as long as the development of the economy and society is directly dependent on information and communication technologies (the "Bangemann Report"), this innovation should be welcomed. Can we agree with this position?

Earlier we already commented on the risks of illegal distribution of personal data, but now let's try to follow a different logic. Let us assume that the legislator has provided a mechanism to force cybercriminals out. His next task is to answer the question: is the information an object of civil rights?

Negotiability: problems and solutions
Let's imagine that you are taking part in an auction. Each of the lots is information about your health, address, phone number, and other identifiers. They are bought by unspecified, unknown persons to you. Is it possible? Apple answers in the affirmative manner (they even released a video on the subject).

The sale of personal data is a well-established phenomenon. Dating apps such as Tinder, Badoo, and others are known to collect a lot of user data, including geolocation, preferences, interests, and age, and sell that data to data brokers, who may use it for marketing or black market sales.

Circulation of personal data is technically illegal, and the subjects of such transactions are usually phone scammers, criminals, competitors and other persons with illicit goals. But what if the sale of personal information were to be legalized? For this purpose it is necessary to solve the question of their negotiability. The solution to this problem depends on which point of view you take.

The first position, a conservative one, is based on the prohibition of personal data turnover and their сommodification.
In this regard, it is relevant to refer to the Russian personal data protection authority (Roskomnadzor), which advocates the idea that personal data is an extension of a person's identity. Personal data hides information that allows not only to identify a "person", but also to find out a variety of preferences - from food to confessional affiliation and information on pregnancy and abortions (yes, it was the collection of this information by menstrual-tracking apps that caused an uproar in America, a particularly hot topic amid the debate over abortion rights abolition). Naturally, such information should not be divulged. Otherwise there would be an intrusion into the personal sphere of a citizen, and thus there is a high probability of a violation of his or her constitutional rights.
Accordingly, under this approach, personal data, as a manifestation of intangible goods, non-transferable and inalienable in its essence, cannot act as an object of civil rights and a counter-provision under the contract.
A different position is held by the liberals, which regard personal data as a potential commodity.
Кажущееся радикальным, это мнение заслуживает всё большей поддержки ввиду процесса коммодификации, то есть признания экономической ценности за благами, ранее не рассматривавшихся в качестве товаров.

Adoption of a data negotiability approach?

The obstacles to the adoption of the personal data turnover approach are the constitutional norms mentioned above and the requirements named by the legislator in special laws.

The solution is possible by adapting western models of consent to the processing of information "in excess of what is necessary for the counterparty to the contract or the requirements of the law," in which personal data becomes a "payment" for the use of services (Article 3(1) of the Digital Content Directive).

As for the constitutional limitations, it is proposed to proceed from the fact that they allow "circulation" with the consent of the subject of personal data. In America, it is generally recognized as possible to sell personal data at the level of individual laws (California Consumer Privacy Act).

In view of the possibility of legal recognition of the civil turnover of personal data, it is necessary to answer the question of the "form" of distribution of personal data - information.

Information as an object of civil rights

Article 5 of the Federal Law "On Information, Information Technologies and the Protection of Information" states that information may be the subject of civil law relations. This wording unconditionally qualifies information as an object of civil rights and therefore implies the possibility of its introduction into civil law relations.

Nevertheless, in the doctrine of Russian law do not cease disputes on the issue of attributing information to the objects of civil law. And this, in our opinion, is due to narrow interpretation of Art. 128 of the Civil Code of the Russian Federation, ignoring the positions of foreign courts and formalism.

Let's turn to the definition of information. According to Professor Braginsky, one of the authors of the Civil Code of the Russian Federation, information must be understood as "a set of information of legal significance, expressed in various forms and subject to monetary evaluation". Let us continue with the description of information as an institution.

Information is a non-consumable good that is not subject to physical depreciation.Information can be used repeatedly and does not depend on the material medium in which it is expressed.

The transfer of information from one person to another is inadmissible - only the transfer of proprietary rights to information is possible. Respectively, in property relations the subject of transactions is not information, but property rights to it.

The same information can be embodied in different forms(textual description, drawings, formulas, etc.) and in many copies. Thus the properties of information obviously do not allow to refer it to the objects of civil rights envisaged in Article 128 of the Civil Code of the Russian Federation.

To be fair, not every researcher has a conservative position on information. Departing from positivist principles the authors put forward their own vision of information. They are based on (i) Article 128 of the Civil Code establishes an open list of information and (ii) the recognition of information as an object with economic value.

Exactly such a perspective fits the logic of European supranational courts. In the case of Paeffgen GmbH v. Germany - 25379/04 the European Court of Human Rights formulated the "economic test" used in assessing the negotiability of goods.

In order to satisfactorily answer the question of whether information contains the properties that allow it to act as object of civil rights, it is necessary:

To determine
· Whether it has economic value
· Whether the use and dissemination of the potential object affects the financial interests of the civil turnover participants.
Let us imagine that there is a mobile app, which allows friends and relatives to track each other's location for free. How does the app generate revenue? The app collects data starts and sells it to data brokers. It is obvious from this that the data has economic value.

Further use of this data, for example to advertise stores and cafes to a person on the way home by the company that bought the data from the data broker, will obviously affect the economic interests of the subject.

Thus, certain categories of information have property value in and of themselves, and can therefore be treated as objects of civil rights.
Problems of liberalization
However, such a conclusion must be subject to a number of limitations.

The first of these is volitional. It is the subject of personal data by his explicit and unambiguous consent that gives the operator the right to process the amount of information beyond what is necessary for the purposes of the contract or the requirements of the law. Using information about the subject without his consent to unlawful grounds, companies do not take into account the will of the person, which is the basis of his autonomy, as well as their own economic interest in providing their data or prohibit their use.

The second is substantive. Obviously, not all personal data is tradable. It is necessary to take into account the identifying potential of data and to prevent the disclosure of certain categories of information that is "sensitive" or whose disclosure would affect the interests of third parties. An improved anonymization mechanism for the latter could be envisioned.

The third is ethical. No matter how much morality may be questioned in the law, the rule of law is built on ethical pillars. One of these is respect for the individual through the recognition and protection of his rights. In this regard, should the legislator allow personal data to circulate in a society where citizens are largely unaware of the risks entailed by the dissemination of personal information that characterizes them? This question is only one of many.

Commodification of benefits is a process attractive to economists but suspicious to lawyers. Not least of all, this is due to the risks of violating the rights of the personal data subject and the shortcomings of data anonymization mechanisms.

The negotiability of personal data is an issue as fascinating as it is unresolved. it’s been a long time since information began to be monetized and traded, became the object of a turnover outside the law. Legally, the situation is much more complicated.

Commodification of benefits is a process attractive to economists but suspicious to lawyers. Not least of all, this is due to the risks of violating the rights of the personal data subject and the shortcomings of data anonymization mechanisms.

The negotiability of personal data is an issue as fascinating as it is unresolved. it’s been a long time since information began to be monetized and traded, became the object of a turnover outside the law. Legally, the situation is much more complicated.

In our long-reading we confirmed the hypothesis that the solution to the problem of "commodification" of information depends on the "optics" chosen. We put forward arguments "for" and "against" the commodification of information. Without suggesting a solution to the problem, we believe that data trading is rather a negative phenomenon.

While acknowledging that information may be collected in excess of the limits of the law, we still believe that the introduction of massive amounts of information into turnover would entail disproportionate risks both for the personal data subjects and for third parties.