India's competition watchdog imposes $25.4 million fine on Meta over 2021 WhatsApp privacy policy
The Competition Commission of India (CCI) has imposed a fine of ₹213.14 crore ($25.4 million) on Meta over the 2021 privacy policy update of WhatsApp.
According to the CCI, users in India should not be forced to agree to share their WhatsApp data with other Meta companies or products for purposes unrelated to WhatsApp services. The commission said, "WhatsApp will not share user data collected on its platform with other Meta Companies or Meta Company Products for advertising purposes, for a period of 5 (five) years from the date of receipt of this order."
The CCI said that Meta, through WhatsApp, holds a dominant position in the market for over-the-top (OTT) messaging apps on smartphones in India. "Furthermore, it was also found that Meta holds a leading position compared to its competitors in online display advertising in India," CCI said in a press release.
The issue began in January 2021, when WhatsApp introduced updated terms of service and privacy policies. The in-app notification informed users that starting February 8, 2021, they would need to accept the updated terms, requiring them to consent to expanded data collection and mandatory data sharing with Meta companies, to continue using the app.
The CCI noted that under WhatsApp's earlier privacy policy from 2016, users could choose whether or not to share their data with Facebook. However, the 2021 update removed this choice, making data sharing with Meta mandatory for all users. This left users with no option but to accept the terms if they wanted to continue using the platform.
The watchdog concluded that this "take-it-or-leave-it" approach amounted to imposing unfair conditions under the Competition Act. "Given the network effects and lack of effective alternatives, the 2021 update forces users to comply, undermining their autonomy, and constitutes an abuse of Meta's dominant position," the CCI said.
The commission further added that allowing WhatsApp to share user data with Meta companies for non-WhatsApp-related purposes created barriers for competitors. "Sharing of WhatsApp users’ data between Meta companies for purposes other than providing WhatsApp Service creates an entry barrier for the rivals of Meta and thus, results in denial of market access in the display advertisement market," the CCI added.
(With inputs from agencies)
