India’s competition appellate body has clarified that WhatsApp must obtain user consent for every instance of data collection and sharing beyond its core messaging service, including both advertising and non advertising uses.
The clarification was issued on Monday by the National Company Law Appellate Tribunal while hearing an application filed by the Competition Commission of India seeking clarity on the scope of an earlier ruling related to WhatsApp’s data practices.
The NCLAT bench, led by Chairperson Justice Ashok Bhushan and Member Arun Baroka, stressed that WhatsApp and its parent company Meta “cannot assert unilateral or open ended rights over user data”.
Reiterating its earlier position, the tribunal stated, “We had clearly held that ‘users must retain the right to decide what data is collected, for which purposes and for how long. Any non essential collection or cross use like advertising etc. can occur only with the concerned users’ express and revocable consent.’”
The tribunal further noted that giving users the ability to opt in or opt out of data sharing at any point, whether for regular or optional features, ensures that “their rights are protected for all times, and exploitation is removed, which has been an issue with the 2021 WhatsApp policy”.
Allowing the CCI’s application, the NCLAT clarified that the remedial directions in Paras 247.2.1 to 247.2.4 of the CCI order dated 18.11.2024 apply to WhatsApp user data collection and sharing for all non WhatsApp purposes, including advertising and non advertising activities. WhatsApp has been given 3 months to make the required changes.
The clarification follows the NCLAT’s earlier order dated November 4, which had granted partial relief to WhatsApp. In that decision, the tribunal upheld the Rs 213 crore penalty imposed by the CCI and confirmed that WhatsApp’s 2021 privacy policy violated Sections 4(2)(a)(i) and 4(2)(c) of the Competition Act. It had initially set aside one part of the CCI order, creating ambiguity around consent for advertising related data sharing, which has now been resolved.
In its detailed 184 page ruling, the tribunal had found that data sharing between WhatsApp and Meta strengthened Meta’s position in the display advertising market and created barriers for competitors. However, it ruled that the alleged violation of Section 4(2)(e) was “not sustainable”, noting that WhatsApp and Meta are separate legal entities.
The original penalty of Rs 213.14 crore was imposed in November last year over the 2021 privacy policy update. An interim order passed in January had stayed the 5 year ban on advertising related data sharing between WhatsApp and Meta.
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