Meta, WhatsApp appeal Rs 213 crore fine over privacy policy dispute

The National Company Law Appellate Tribunal (NCLAT) has admitted appeals by Meta Platforms, previously known as Facebook, and its messaging service WhatsApp, challenging a Rs 213.14 crore penalty imposed by the Competition Commission of India (CCI). The fine is linked to allegations of abusing their market dominance with WhatsApp's controversial 2021 privacy policy.

A two-member bench of the NCLAT, chaired by Justice Ashok Bhushan, acknowledged the complexity of the case. “We find that the submissions raised by the parties need consideration. We admit both the appeals,” stated the bench after hearing preliminary arguments from Meta and the CCI.

Meta and WhatsApp sought an urgent hearing and an interim stay on the CCI’s order, emphasizing the significant implications of the case. However, the CCI opposed this request. The tribunal is set to decide on January 23 whether the interim stay will be granted.

The dispute stems from WhatsApp's 2021 privacy policy update, which the CCI alleged violated transparency norms and did not offer users voluntary consent. The policy allowed for expanded data sharing with Meta's ecosystem, raising concerns over excessive data collection and user tracking. According to the CCI, this approach exploited WhatsApp’s dominant market position, forcing users into a “take it or leave it” arrangement.

The CCI initiated its probe in January 2021 after observing that the updated policy failed to give users sufficient granular options to control data sharing. The regulator argued this compromised user autonomy, reduced data protection, and degraded service quality, violating competition laws. The policy, it said, primarily served to strengthen Meta's advertising business through aggressive data harvesting.

In earlier proceedings, Meta and WhatsApp argued that the policy issue was already under judicial review by higher courts, including the High Court and Supreme Court. Despite this, a single-judge bench in April 2021 declined to halt the CCI’s investigation, enabling the probe to continue.

The case holds significant implications for data privacy, corporate accountability, and the regulatory landscape in India, as the NCLAT deliberates on the appeals.