Meta secures partial relief in dispute over data sharing

CCI's order barring WhatsApp from sharing user data with Meta group companies modified

- Krishna Yadav

NCLAT has upheld CCI's imposition of ₹213 crore penalty on Meta.

The National Company Law Appellate Tribunal (NCLAT) upheld the ₹213 crore penalty on Meta Platforms and WhatsApp, finding that the Competition Commission of India (CCI) had correctly established abuse of dominance and imposed a proportionate fine.

"The penalty imposed of ₹213.14-crore only (Rupees Two Hundred Thirteen Crores and Fourteen Lakhs only) upon Meta is upheld," the judgment noted.

The tribunal agreed that WhatsApp's 2021 privacy policy forced users to accept expanded data-sharing terms without real choice, violating Section 4(2)(a)(i) of the Competition Act, which prohibits dominant firms from imposing unfair conditions. It also noted that Meta and WhatsApp operate under common ownership and control, justifying a joint penalty.

However, the NCLAT said the five-year ban lacked reasoning and was legally unjustified. It observed that restoring user consent and opt-in/opt-out choice sufficiently addresses the coercive elements of the 2021 policy.

"Once users have been given the option to freely decide to opt in or opt out...this direction becomes redundant," the judgment stated.

Lawyers described the verdict as balanced and nuanced.