Supreme Court dismisses plea by WhatsApp, Meta challenging CCI probe

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The Supreme Court on October 14 dismissed petitions by WhatsApp and Meta platforms (earlier called Facebook) challenging the probe launched by the Competition Commission of India against WhatsApp's updated privacy policy.

The plea by WhatsApp and Meta platforms was against the judgment of the Delhi High Court, which allowed the CCI probe against the two and had dismissed their pleas.

Today, the Supreme Court said that CCI is an independent authority which probes violations of Competition Act, 2002. Proceedings initiated by CCI after finding prima facie grounds for launching such an investigation cannot be said to be without jurisdiction, the apex court said in its order.

The CCI cannot be restrained from probing alleged violations of the competition law, the court said as it dismissed the petitions by WhatsApp and Meta.

During the course of the hearing counsel for WhatsApp, Senior Advocate Kapil Sibal, told the court that while the CCI can probe the alleged abuse of dominance position in the relevant market, it cannot decide on the policy of the entity. Whether a policy is valid or not can be decided by a constitutional court only, Sibal said.

It was highlighted that a constitution bench of five judges of the Supreme Court is schedule to hear a batch of petitions challenging the validity of WhatsApp's privacy policy in January 2023. Meanwhile a bill of data protection is also expected to be tabled, it was argued.

"It is a jurisdictional issue," Sibal said pointing out that the CCI order says that the policy "prima facie appears to be unfair to users". Sibal argues that it is not the jurisdiction of the CCI to decide on the policy. This argument found support from Senior Advocate Mukul Rohatgi representing Meta platforms.

The bench observed that prima facie observation may be for the purpose of initiation of the investigation.

Additional Solicitor General N Venkatraman, who represented the CCI, stressed that the market regulator was not probing the Article 21 issue concerning privacy involved. The competition concerns raised by the imposition of unfair conditions by WhatsApp on its users are under probe by CCI, the ASG said.

WhatsApp and Meta urged the court to direct CCI to not pass the final order on its probe till the issue of constitutional validity of the privacy policy is decided by the Supreme Court.

The anti-trust watchdog had initiated probe against WhatsApp and its parent company Meta (earlier called Facebook) concerning the updated privacy policy of WhatsApp introduced in early 2021.

Also Read | Explained | What is the role of Competition Commission of India

The updated policy allowed WhatsApp to share certain data concerning user interaction with business accounts with its parent company. This policy was scheduled to be implemented in India last year.

CCI's probe came on the apprehension that this policy may provide undue advantage to WhatsApp and Meta and may have adverse effect on competition.

The investigation was challenged before the Delhi High Court where a single judge bench allowed the probe and the decision was affirmed by a division bench.

WhatsApp and Facebook had questioned CCI's power to investigate privacy policy whereas CCI stressed that it is investigating the aspect of impact on competition the policy of likely to have.

Meanwhile, WhatsApp had declared before the high court that the users will not be barred from using the messaging application service even if they have not accepted the updated privacy policy. The rollout of the policy will be kept on hold till the time a law on data protection is brought in India, the high court was told.

The probe which had remained in a limbo during the pendency of the case in the high court was allowed to proceed after the division bench's judgment.