NCLAT to hear Meta's appeal against ₹213cr fine by CCI
What's the story
The National Company Law Appellate Tribunal (NCLAT) will hear Meta's appeal on January 16.
The appeal challenges a penalty imposed by the Competition Commission of India (CCI) for allegedly abusing market dominance.
The CCI had fined Meta ₹213.14 crore over WhatsApp's 2021 privacy policy update, accusing the company of misusing its dominant position in the market.
Urgent appeal
Meta seeks urgent hearing due to case implications
Notably, Meta has sought an urgent hearing from the NCLAT, highlighting the case's far-reaching implications and stakes.
The NCLAT bench, headed by Chairperson Justice (Retd.) Ashok Bhushan, has agreed to hear the matter on January 16.
Senior Advocates Kapil Sibal and Mukul Rohatgi, appearing for Meta and WhatsApp, respectively, have emphasized the CCI order's industry-wide repercussions.
Regulatory action
Order on WhatsApp's data sharing policy
On November 18, 2024, the CCI ordered WhatsApp to not share user data with other Meta companies or products for advertising purposes for five years.
The regulator also ordered that any data shared for non-advertising purposes must be clearly explained in WhatsApp's policy.
This includes detailing the type of user data shared with Meta group companies or products and specifying its purpose.
User rights
CCI's stance on user consent and data sharing
The CCI has stressed that user consent must be the bedrock of social media giants' functioning.
The regulator also said that sharing WhatsApp user data with other Meta companies or products for purposes other than providing WhatsApp services, shouldn't be a pre-condition for users to access the messaging service in India.
This order comes in line with steps taken by other countries to safeguard user data.
Company stance
Meta's response to order and penalty
In light of the CCI's order and penalty, Meta has reiterated that user privacy is a top priority.
The company claimed that the 2021 policy update did not impact the privacy of users' personal messages.
Meta also clarified that users who did not accept the updated policy could continue using WhatsApp without losing functionality or having their accounts deleted.
Regulatory directives
CCI's directives to Meta and WhatsApp
Along with the penalty, the CCI also issued cease-and-desist directives and behavioral remedies to curb anti-competitive practices.
The regulator directed Meta and WhatsApp to improve transparency by clearly explaining the type of data shared with Meta and linking it to specific purposes.
They were also instructed to give users an option to opt out of non-service-related data sharing through in-app settings.