NCLAT To Hear Meta’s Plea Against CCI Penalty On January 16

A bench of the National Company Law Appellate Tribunal (NCLAT) is set to hear on January 16 a plea by Meta platforms against an order by the Competition Commission of India (CCI), which asked the company to pay a penalty of INR 213.14 Cr for abusing its dominant position in relation to the 2021 privacy policy update of its messaging app WhatsApp.

According to a Bar and Bench report, senior advocates Kapil Sibal and Mukul Rohatgi appeared on the behalf of Meta, requesting an urgent hearing. 

“The order has huge implications. We request your lordships to take it up yourself. Since it is going to affect the entire industry, please take it up on January 16,” they said. 

The update comes days after Meta said that it disagrees with the watchdog and would appeal against the same. 

In 2021, the messaging platform introduced a privacy policy that asked users to accept the amended policy in order to access WhatsApp chats and groups. 

The policy included sharing of users’ data such as business transactions on WhatsApp, other activities and device-level information with Facebook. 

Under the new terms and conditions, WhatsApp now shares transaction data, mobile device information, IP addresses, and other data on how users interact with businesses with Facebook group companies, including Instagram.

Before the policy, the company was already collecting device, connection and location information automatically. 

Moreover, under the new policy, WhatsApp now collects location info, even when location settings have been turned off, using multiple indicators. It also automatically collects device and usage log, which  

The aftermath of the policy saw a huge controversy as two individuals challenged it in the Delhi High Court, contending that it was a violation of their privacy and free speech.

At the time, CCI protested that the policy was of a “take-it-or-leave-it” approach, and that it came across as imposition of unfair conditions under the Competition Act. 

Further, CCI also said that the policy undermined the users’ autonomy with Meta’s abuse of its dominant position in the market. 

According to the watchdog, data sharing between Meta and WhatsApp could have resulted in entry barriers for the competitors of the social media giant. 

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.