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WhatsApp faces a fresh antitrust investigation in India over its new privacy policy that shares users’ data with Facebook

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  • India’s competition watchdog, the Competition Commission of India (CCI), has launched a fresh probe into WhatsApp’s new privacy policy that was announced in January.
  • According to the CCI, the fact that WhatsApp does not give users the option to opt-out of the new terms and conditions may be construed as abuse of its dominant position in the market.
  • Moreover, the CCI believes that crosslinking and integration of data can be used by companies like Facebook and WhatsApp to further strengthen their market power and hinder competition from others.

India’s competition watchdog has launched a fresh antitrust investigation against WhatsApp. The Competition Commission of India (CCI) believes that WhatsApp is using its dominant position in the market to force users into sharing their information with its parent company, Facebook, with its new privacy policy.

According to the CCI, in a world where data is gaining more importance, it is necessary to examine whether excessive data collection is getting in the way of creating a healthy competitive environment.

“The Commission is examining the policy update from the perspective of competition lens in ascertaining as to whether such policy updates have any competition concerns which are in violation of the provisions of Section 4 of the Act,” said the order.

Section 4 of the Competition Act prohibits enterprises holding a dominant position in a relevant market from abusing such a position.

The competition watchdog believes that crosslinking and integration of user data can further strengthen the market power of dominant firms. And, in India, WhatsApp is the most popular messaging service with over 530 million users, according to
data from the Indian government.

That is why the CCI justifies that it has asked the Director-General to look into the ‘exploitative’ and ‘exclusionary’ conduct of WhatsApp in India.

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“We look forward to engaging with the CCI. WhatsApp remains committed to protecting people’s personal communications with end-to-end encryption and providing transparency about how these new optional business features work,” said the WhatsApp Spokesperson in response to Business Insider’s query on the CCI’s order.

WhatsApp’s ‘take it or leave it’ attitude
The issue is not that WhatsApp updated its privacy policy or even that it’s collecting user data. The bigger problem is the fact that it’s not giving users a choice to opt-out while still being able to use the service.

In the past, when WhatsApp updated its privacy policy in 2016 and in 2019, users were provided with an option to not have their WhatsApp account information shared with Facebook. Informed consent, if mandatory — like in the case of WhatsApp — can be construed to be an abuse of its dominant position in the market.

The CCI also noted that users, as owners of their personalised data, are entitled to be informed about the extent, scope and precise purpose of sharing such data by WhatsApp with other Facebook companies.

“The purpose of such sharing appears to be beyond users’ reasonable and legitimate expectations regarding quality, security and other relevant aspects of the service for which they register on WhatsApp,” said the order.

WhatsApp and Facebook were given time to provide an explanation
According to the CCI, it gave both WhatsApp and Facebook ample time to respond to queries with respect to the new terms and conditions but did not receive any appropriate response in return. “The Commission has given careful consideration to the response filed by Facebook and notes that the same is not only evasive but is in clear non-compliance with the direction issued by the Commission,” said the order.

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