Last month, the Competition Commission of India ordered a probe against WhatsApp for its new privacy policy. CCI viewed WhatsApp’s new privacy policy as an ‘abuse of dominance’. WhatsApp challenged this order in the Delhi HC. Hearing the matter, the Court stated the probe order is not consistent with a ‘abuse of dominance’ investigation. The Delhi HC noted that it appears the CCI’s WhatsApp investigation is more concerned with the privacy of users.
This comes after CCI stated that it is not examining the violation of user privacy.
“Your order does not reflect it is an investigation into the alleged abuse of dominant position,” the court said.
Delhi HC
What is the issue with the order?
The Competition Commission of India was established to ensure healthy competition in the market. It ensures there are no unfair practices in the market that can undermine healthy competition.
The Statement of Intent and Objectives of the Competition Act, 2002 empowers the CCI to act in the interest of consumers. However, any CCI intervention must be based on the investigated party’s anticompetitive conduct.
CCI’s investigation order tends focus on consumer welfare rather than free-market security. Therefore, the question is whether a perceived threat to consumer protection amounts to anti-competitive behavior and, as a result, warrants DG investigation.
Submissions of Parties
Senior Advocate Aman Lekhi represented the CCI. In his submissions, he stated that WhatsApp’s new privacy policy would result in excessive data collection and “stalking” of customers for targeted ads. This situation is therefore an alleged violation of the dominant position.
“There is no question of jurisdictional mistake. WhatsApp and Facebook’s appeals of the CCI’s decision were “incompetent and misconceived.”
He further submitted that only on investigation could one determine whether WhatsApp’s data collection and data sharing (with Facebook) violated antitrust rules. This investigation was only an administrative proceeding having no immediate civil consequences.
Senior Advocates Mukul Rohatgi and Harish Salve represented Facebook and WhatsApp. They have challenged the CCI’s March 24 order against WhatsApp.
“It is like a trigger happy jurisdiction”
The platforms argued the privacy issue was sub judice in the Supreme Court. They contended that the order was an abuse of the Commission’s suo moto jurisdiction. Further, they stated the CCI ordered an investigation into WhatsApp’s privacy policy because, unlike in the past, WhatsApp did not provide an opt-out option.
WhatsApp can choose whether or not to share data generated on its system, they asserted. The CCI cannot dictate what is excessive and what is not unless there is a policy on data collection.
The HC has reserved its order.
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