The National Company Law Appellate Tribunal (NCLAT) on Wednesday admitted Meta Platforms (formerly Facebook) and WhatsApp’s application challenging the Competition Commission of India (CCI) order imposing a fine of Rs 213.14 crore on the tech giant for alleged abuse of its dominant position related to WhatsApp's 2021 privacy policy.
After hearing the preliminary submissions from Meta and the CCI on the issue, a two-member bench of the NCLAT, led by Chairperson Justice Ashok Bhushan, said the issue requires consideration.
“We find that the submissions raised by the parties need consideration. We admit both the appeals,” said the NCLAT bench.
The NCLAT is set to decide on January 23 whether an interim stay on the CCI's order should be granted.
Counsel for Meta and WhatsApp prayed for an interim stay, but the CCI opposed it.
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Meta had earlier asked the NCLAT to hear the case urgently, citing its implications and the stakes involved.
The anti-trust regulator is probing the company’s privacy policy, which it claims is neither transparent nor based on the voluntary consent of users. The CCI stated that such a policy could lead to excessive data collection and ‘stalking’ of consumers for targeted advertising to bring in more users, amounting to an abuse of its dominant position.
The CCI had earlier told the court that it was unable to “move an inch” in its investigation into WhatsApp’s 2021 privacy policy due to a court order granting time to Facebook and the instant messaging platform to file replies in connection with the probe.
In January 2021, the CCI independently decided to examine WhatsApp’s updated privacy policy following news reports.
The regulator observed that users were not provided with an appropriate granular choice to object to or opt out of specific data-sharing terms. It added that the reduction in consumer data protection and loss of control over personalised data could be considered a reduction in quality under anti-trust law.
In its order, the CCI stated that WhatsApp’s update was a ‘take it or leave it’ policy, forcing all users to accept expanded data collection terms and the sharing of data within the Meta group, with no option to opt out. This, it said, undermined user autonomy and constituted an abuse of Meta’s dominant position.
WhatsApp and Facebook subsequently challenged the single-judge CCI order of March 2021 directing a probe against them, arguing that the issue concerning the new policy was already pending consideration before the High Court (HC) and the Supreme Court (SC).
However, on April 22, 2021, the single judge refused to interdict the investigation.