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  • Sakshar Law Associates

Privacy under Competition Law- Recent discussion by Competition Commission of India

Updated: Sep 16, 2022


Sakshi Shairwal

Sagarnil Ghosh

The word Privacy can be said to be a seven-letter word, but the ambit and the undertone of the word bear a much wider connotation per se. The Supreme Court of India proclaimed ‘privacy’ to be a fundamental right in the famous landmark case of ‘Justice K.S Puttaswamy (Retd) V. Union Of India on the 26th of September 2018. Therefore, in the year 2019, MEITY introduced the Personal Data Protection Bill adjoining the realm of competition law with the aim to protect individuals’ personal data by setting up consent as the main requirement for data sharing. Further, it provided for the penal imposition to be bearded by the individual/organization for the transferring of personal data without the consent of the users. In this article, I would bring upon the implication and implementation of the ambit of the word ‘privacy’ in the realm of competition law in the backdrop of the recent case of CCI and WhatsApp.

WhatsApp’s New Privacy Policy (Either accept it or lose the key WhatsApp features)

When Facebook bought WhatsApp in 2014, the messaging platform issued a new privacy policy a few years later in 2016, stating that it will now connect your phone number with Facebook's systems in order for Facebook to provide better friend recommendations and show you more relevant advertising.

This implies WhatsApp has previously been sharing certain information with its parent firm Facebook, but with its new privacy policy for 2021, it intends to share even more data with Facebook, including WhatsApp payment and transaction data. Though the company has stated that users' chats are safe and that their calls are end-to-end encrypted, that their contacts are not shared with Facebook, and that neither WhatsApp nor Facebook can read the messages, they need to collect excessive data in the name of showing relevant ads has raised suspicion among its users.

The aftermath of non-opting for the new privacy policy

You will be reminded to accept the new policy every time you use the app, and if you continue to refuse, WhatsApp will become more or less worthless to you.

i.) You'll be able to answer incoming voice and video calls at first.

ii.) You may also touch on alerts to read or reply to a message if you have them turned on.

iii.) A missed audio or video call can be rescheduled.

iv.) You will cease receiving WhatsApp calls, messages, and even notifications after a few weeks.

Those who agree to the new policy will not notice a change in their experience. However, if you have WhatsApp installed on your phone and continue to refuse to accept the rules, WhatsApp will not erase your account instantly. If you don't connect for 120 days, it will most likely cancel your account due to "inactivity."

The reality of the Privacy Policy

Accepting the new privacy policies will, in reality, have little influence on most users' dealings with WhatsApp. By default, all WhatsApp interactions will be end-to-end encrypted, which means that your messages and images will only be accessible by you and the individuals with whom you're speaking. WhatsApp will also be unable to view or share any of your chats with Facebook. In the meanwhile, WhatsApp will be allowed to share user account information with Facebook, such as your phone number, records of how long and how often you use WhatsApp, device IDs, IP addresses, and other device characteristics. Furthermore, if you give WhatsApp permission, it can share transaction and payment data, cookies, and location information with Facebook. All of this has been shown to be accurate. Furthermore, if you give WhatsApp permission, it can share transaction and payment data, cookies, and location information with Facebook. All of this has been shown to be accurate.

Contentions raised by WhatsApp

From a competition standpoint, WhatsApp claims that the 2021 Update poses no problems. The 2021 Update aims to increase openness by clarifying the usage, collection, and sharing of data that users agreed to in the 2016 Update. WhatsApp cited the Supreme Court's decision in Competition Commission of India v. Bharti Airtel Limited and Others, (2019) 2 SCC 521, stating that the decision highlights the need for civility between decisions of different authorities on the same issues and that the Commission should only exercise jurisdiction after the proceedings before the sectoral regulators are completed. WhatsApp has also used the Commission's decisions in Harshita Chawla v. WhatsApp Inc, Case No. 15 of 2020 (the 'Harshita Chawla case'), as well as XYZ v. Alphabet Inc, Case No. 07 of 2020, to argue that data localization and data sharing problems aren't covered by competition law.

Review by the Competition Commission of India

In a significant step, The Competition Commission of India conducted an investigation into WhatsApp's new privacy policy, after concluding that it was in violation of the Competition Act, 2002.

In its meeting, the CCI reviewed the response and concluded that it did not comply with Regulation 35 of the Competition Commission of India (General) Regulations, 2009 (the "General Regulations"). The Commission then continues to investigate the matters on their merits in order to determine whether the Opposing Parties have violated Section 4 of the Competition Act. The problematic data-sharing behavior of WhatsApp with Facebook clearly reflects a deterioration of one of the non-price competitive characteristics, namely quality. As a result, customers suffered objective harm for which there was no acceptable reason. Such behavior clearly amounts to the imposition of unreasonable terms and conditions on WhatsApp electronic communication app users, in contravention of Section 4(2)(a)(i) of the Competition Act.

The Competition Commission of India instructed the Director-General (‘DG') to conduct an inquiry into the matter under Section 26(1) of the Competition Act on March 24, 2021. In addition, the Commission requires the concerned authority to complete the investigation and submit the investigation report within sixty days after receiving this order.

The matter before the High Court of Delhi

The Delhi high court has briefly set aside the decision on Facebook and WhatsApp’s offers against the CCI's structure for an examination concerning the informing application's protection strategy, and the case will be heard again sometime in the future. After all of the parties' attorneys concluded their arguments, a single bench led by Justice Navin Chawla reserved the order. The court was considering both petitions contesting CCI's decision mandating a test of the revised privacy policy and stating that the test must be completed within 60 days.

Matter as to why the CCI intervened

"Users, as proprietors of their individualized information, are qualified to be educated about the extent, degree, and purpose behind such information trade by WhatsApp with other Facebook Companies," as per the CCI. Nonetheless, many of the information categories listed in the Privacy Policy and Terms of Service appear to be excessively broad, ambiguous, and useless. Information on how users "interact with others (including companies)" isn't precisely defined, and what constitutes "service-related information," "mobile device information," "payments or business features," and so on are not like that. It's also worth noting that, in numerous places throughout the policy, when illustrating the data to be collected, the list is typical and not exhaustive due to the use of words like "includes," "such as," "For example," and other similar terms, implying that the scope of sharing may extend beyond the information categories explicitly mentioned in the policy. The actual data cost that a user incurs for using WhatsApp services is hidden behind such ambiguity, open-endedness, and inadequate disclosures. It's also unclear from the policy if users' past data would be shared with Facebook Companies, and whether data will be shared for WhatsApp users who aren't on Facebook's other applications.

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