The **Competition Commission of India (CCI)** has imposed a **₹213.14 crore fine (approximately $25.3 million)** on **Meta Platforms**, citing abuse of its dominant position through **WhatsApp’s 2021 privacy policy update**.

The CCI determined that the policy violated the **Competition Act**, as it forced users to share their data with Meta’s subsidiaries, including **Facebook** and **Instagram**, without providing an option to opt out.

### Key Directives Issued to WhatsApp
In its ruling, the CCI mandated the following actions from WhatsApp to safeguard user interests:
1. **Stop Sharing Data with Meta for Advertising:**
WhatsApp is barred from sharing user data with Meta entities for advertising purposes for the next five years.

2. **Avoid Mandatory Data Sharing:**
WhatsApp must not make data-sharing with Meta companies a mandatory condition for using its services in India.

3. **Transparency in Data Sharing:**
WhatsApp is required to:
– Clearly specify the types of data shared with Meta companies.
– Explain the purposes behind data sharing.

4. **Offer Users a Choice:**
– Users must be allowed to opt out of non-service-related data sharing.
– Users should be able to modify their data-sharing preferences directly within the app.
– This opt-out option must also be extended to users who accepted the 2021 privacy policy update.

### Findings of the CCI Investigation
The CCI’s investigation revealed that WhatsApp holds a **dominant position in India’s OTT (over-the-top) messaging market**, while Meta leads the **online display advertising sector**. The 2021 privacy policy update was deemed exploitative, imposing “unfair conditions” by requiring users to accept expanded data-sharing terms without alternatives.

The Commission found that this practice:
– **Exploited WhatsApp’s Dominance:** Users had no viable alternative platforms, forcing them to comply.
– **Created Entry Barriers:** By sharing user data exclusively within Meta’s ecosystem, the policy obstructed competitors in the advertising market and reinforced Meta’s dominance.

### Regulatory Pushback Against the 2021 Update
The 2021 privacy policy faced widespread criticism for undermining user choice and data privacy. Regulators globally raised concerns over its antitrust and privacy implications.

– In **August 2024**, a **Brazilian court** banned WhatsApp from sharing user data with Facebook and Instagram.
– The CCI’s ruling aligns with broader efforts to curb monopolistic practices in the digital ecosystem.

### Meta’s Response and Legal Battles
Following the ruling, a Meta spokesperson expressed disagreement, stating:
> _“We disagree with the CCI’s decision and plan to appeal. The 2021 update did not change the privacy of people’s personal messages and was offered as a choice for users. No accounts were deleted or restricted due to this update.”_

Meta and WhatsApp had previously sought to halt the CCI investigation, arguing that related privacy matters were already being addressed in the **Delhi High Court** and the **Supreme Court**. However, these appeals were dismissed by a single-judge bench in **2021** and later by a division bench in **2022**, allowing the investigation to continue.

### Global Scrutiny of Data Practices
The CCI ruling reflects growing regulatory scrutiny over how digital platforms manage consumer data and wield their market power. WhatsApp’s privacy policy update, rolled out in January 2021, marked a pivotal moment, drawing criticism worldwide for its perceived anticompetitive and privacy-violating implications.

### Implications for Meta and the Industry
This fine serves as a reminder of the heightened regulatory vigilance around **Big Tech’s data practices**. It underscores the importance of:
– Transparency in handling user data.
– Offering consumers genuine choices regarding their privacy.
– Ensuring that dominant platforms do not exploit their market position to stifle competition.

### Way Forward
While Meta plans to appeal the decision, the CCI’s directives signal a shift toward stricter oversight of digital platforms in India. With the regulatory landscape evolving, the tech industry may need to reevaluate its practices to align with consumer protection and fair competition standards.

Author: Sonali Kamble