Meta to challenge CCI fine and cease-and-desist directions in Whatsapp case

The Competition Commission of India (CCI) fined Meta Rs 213.14 crore on November 18 for abusing its dominant position in relation to WhatsApp's 2021 privacy policy update, in addition to issuing cease-and-desist directions. WhatsApp has more than 500 million monthly active users in the country.

CCI has also directed WhatsApp not to share user data collected on its platform with other Meta products or companies for advertising purposes for a period of five years, along with other remedial measures.

A press release issued by CCI said that it has issued cease-and-desist directions to Meta and WhatsApp and has also asked it to implement certain behavioural remedies.

"The Commission also issued cease-and-desist directions and also directed Meta and WhatsApp to implement certain behavioural-remedies within a defined timeline," it stated.

Meta is set to challenge the order and fine. "We disagree with the CCI’s decision and plan to appeal. As a reminder, the 2021 update did not change the privacy of people’s personal messages and was offered as a choice for users at the time. We also ensured no one would have their accounts deleted or lose functionality of the WhatsApp service because of this update," said a Meta spokesperson in a statement.

In January 2021, WhatsApp had informed users about updates to its terms of service and privacy policy, effective from February 8, 2021. Unlike the previous privacy policy from August 25, 2016 the updated policy made data sharing with Meta mandatory.

CCI started an investigation in March 2021 into WhatsApp's revised privacy policy, which enabled mandatory data sharing with Facebook and its companies, along with an expanded scope of data collection.

It concluded that Meta Group, through WhatsApp, was in a dominant position in the market for messaging apps through smartphones in India and in a leading position in online display advertising in India. According to the commission, the policy compels all users to accept expanded data collection terms and sharing of data within the Meta Group without an option to opt out of it.

"Given the network effects and lack of effective alternatives, the 2021 Update forces users to comply, undermining their autonomy, and constitutes an abuse of Meta’s dominant position. Accordingly, the Commission finds that Meta (through WhatsApp) has contravened Section 4(2)(a)(i) of the Act" CCI stated.