CCI imposed a fine of Rs 213 crore on Meta, the matter is related to users’ data.

New Delhi: The Competition Commission of India has imposed a fine of Rs 213 crore 14 lakh on Meta for abusing its dominance. This penalty has been imposed for anti-competitive activities in relation to the Privacy Policy Update of 2021. This matter is related to the implementation of WhatsApp’s 2021 Privacy Policy and the matter of collecting user data and sharing it with other companies of Meta.

Instructions given to Meta

The commission has also directed Meta and WhatsApp to take some improvement steps within a stipulated time. The Commission has directed that WhatsApp will not share user data collected on its platform with other Meta companies or Meta company products for advertising purposes. This ban has been imposed for 5 years.

In this case the Commission looked at the two related markets separately. In this, the market of OTT messaging apps through smartphones in India was considered as a separate market and online display advertising in India was considered as a separate market. The Commission found that Meta Group, which operates through WhatsApp, dominates the market of OTT messaging apps through smartphones in India. It was also found that Meta is way ahead of its competitors in the online display advertising market in India.

From January 2021, WhatsApp started giving updates to users about its terms of services and privacy policy. It was said in the in-app notification that users will have to accept these conditions which will be applicable from 8 February 2021. In these conditions, along with increasing the scope of data collection, there was also talk of mandatory data sharing with Meta companies. It was said in the notification that if the user wants to continue using WhatsApp, then they will have to accept these terms.

Ban imposed for five years

The Commission has directed that WhatsApp will not share user data collected on its platform with other Meta companies or Meta company products for advertising purposes. This ban has been imposed for 5 years. In case of sharing WhatsApp user data for purposes other than advertising, detailed information about the data shared with other Meta companies will have to be given in the WhatsApp policy. It will have to be mentioned for what purpose the data was shared. The purpose of sharing every data will have to be clear.

To use WhatsApp service in India, there will be no condition imposed on users that their WhatsApp data will be shared with other Meta companies or Meta Company products. WhatsApp is prohibited from sharing user data for purposes other than providing WhatsApp services. In case of this, all users in India will be given the option to not accept this condition and this information will have to be given prominently through in-app notification. This option will also be available to those users who had accepted the terms of WhatsApp in the 2021 update.

Additionally, users will also be given the option to change their choices regarding such data sharing. This will have to be provided through a tab in the settings of the WhatsApp application. The Commission has said that these rules will have to be followed in all future policy updates. Earlier, in the privacy policy of August 25, 2016, WhatsApp users were given the option whether they wanted to share data with Facebook or not. But in the 2021 policy update, WhatsApp made data sharing with Meta mandatory for all users. In such a situation, users were left with no option but to accept the new terms to continue using WhatsApp.

Commission called the policy update inappropriate

The Commission found that the 2021 policy update was inappropriate. The Commission said that Meta violated the Competition Act through WhatsApp. The Commission concluded that sharing of WhatsApp users’ data among Meta’s companies for purposes other than providing the WhatsApp service constitutes an entry barrier for Meta’s competitors and, therefore, prevents them from entering the display advertising market. The Commission also found that Meta used its dominance in the market for OTT messaging apps via smartphones to protect its position in the online display advertising market, in violation of the Act.