CCI Imposes Penalty on Meta for Abuse of Dominant Position

The Competition Commission of India has imposed a penalty of Rs. 213.14 crore on Meta for placing unfair conditions and abusing their dominant position. Meta had imposed a policy update by WhatsApp expanding data collection terms on a take it or leave it basis in 2021, forcing users to comply without any opt-out, which is in contravention of Section 4(2)(a)(i) of the Act.

Moreover, sharing of WhatsApp users’ data between Meta companies for purposes other than providing WhatsApp service creates an entry barrier denying market access in the display advertisement market, contravening the provisions of Section 4(2)(c) of the Act. Also, while delineating two relevant markets, i.e., the market for OTT messaging apps through smartphones in India and the market for online display advertising in India, the commission observed that Meta had engaged in leveraging its dominant position in the OTT messaging apps to protect its position in the online display advertising market, hence contravening Section 4(2)(e) of the Act.

The Commission issued cease-and-desist directions and directed Meta and WhatsApp to implement certain behavioral remedies within a defined timeline, including detailed explanations of the user data shared and giving users the choice to manage such data sharing by way of an opt-out option.

Disagreeing with the decision, Meta clarified that the update aimed to introduce optional business features on WhatsApp and improve transparency regarding data collection and usage. The Supreme Court had in October 2022 dismissed the petitions filed by WhatsApp and Meta seeking to stay the investigation by the CCI into their privacy policy.