Facebook-owned messaging application WhatsApp is in trouble in India over its new privacy policy. The Competition Commission of India (CCI) on Wednesday ordered a probe for breaching the antitrust law.
The investigation has been ordered under Section 26 (1) of the Competition Act. The probe is expected to be completed within a period of 60 days from the receipt of its order.
The probe was ordered after CCI questioned WhatsApp on this issue.
Key points by the CCI:
- In a data-driven ecosystem, the competition law needs to examine whether the excessive data collection and the extent to which such collected data is subsequently put to use or otherwise shared have anti-competitive implications, which require antitrust scrutiny.
- In digital markets unreasonable data collection and sharing, may grant competitive advantage to the dominant players. This may result in exploitative as well as exclusionary effects, which is a subject matter of examination under competition law.
- In a clarification sort by CCI to Whatsapp. The messaging application explained the primary aim of the 2021 update is:
(i) to provide users with further transparency about how WhatsApp collects, uses and shares data; and
(ii) to inform users about how optional business messaging features work when certain business messaging features become available to them.
- If a WhatsApp user had opted out of an option to share their WhatsApp account information with Facebook Companies for ads and product experiences purposes in 2016, then it will be honoured, the company said. However, if anyone who has previously opted out agrees to the 2021 update, WhatsApp will acknowledge their agreement to the 2021 update and also continue to honour the 2016 opt-out.
- The previous privacy policies of WhatsApp dated August 25, 2016 as well as December 19, 2019 wherein the existing users were provided with an option to choose not to have their WhatsApp account information shared with Facebook. But 2021 does not allow that option.
- In addition, the company also told CCI that the 2021 update does not expand WhatsApp’s ability to share data with Facebook. It stated that it does not impact the privacy of personal messages of WhatsApp users with their friends and family.
- WhatsApp has submitted to CCI that the 2021 update raises no concerns from a competition perspective.
- The company claimed that the 2021 update is an extension of the 2016 update for those users who opted for the 2016 update.
- The company added the latest update will inform users about how optional business messaging features work when certain business messaging features become available to them.
- WhatsApp requested CCI to refrain from investigating into WhatsApp’s 2021 update.
- The Commission is of prima facie opinion that the ‘take-it-or-leave-it’ nature of privacy policy and terms of service of WhatsApp and the information sharing stipulations in view of the market position and market power enjoyed by WhatsApp demand a probe.
