CCI’s probe into Whatspp’s new Privacy Policy was well reasoned: HC

Case Details: Whatsapp LLC v. Competition Commission of India - [2022] 141 taxmann.com 458 (Delhi)

Judiciary and Counsel Details

• • Satish Chandra Sharma, CJ. & Subramonium Prasad, J.
  • Harish Salve, Sr. Adv. Tejas Karia, Shashank Mishra and Ms. Supritha Prodaturi, Shashank Mishra for the Appellant. Advs. for the Appellant.
  • Parag Tripathi,Sr. Adv. N. Venkataraman, ASG V. Chandrashekara Bharathi, Ms. Amritha Chandramouli, S. Ram Narayan, Samar Bansal, Madhav Gupta, Vedant Kapur, Ms. Binsy Susan, Ms. Anjali Kumar, Shyamal Anand, Vishesh Sharma, Ajit Warrier, Yaman Verma, Swati Aggarwal and Ms. Mishika Bajpai, Advs. for the Respondent.

Facts of the Case

In the instant case, an appeal was filed by WhatsApp LLC (hereinafter referred as the “Appellant”) before the High Court against the order of the single judge allowing the Director-General, CCI, to investigate the 2021 Terms of Service and Privacy Policy of the Appellant.

Prior to 25.08.2016, WhatsApp, was governed by its Terms of Service and Privacy Policy of July 2012. In the year 2014, WhatsApp was acquired by Facebook. On 25.08.2016, the Terms and Services and the Privacy Policy of WhatsApp (hereinafter referred to as “2016 Policy”) was updated, and WhatsApp users were informed of Facebook’s acquisition of WhatsApp and how Facebook would use WhatsApp’s information for its advertisement and products. A one-time opportunity was given to WhatsApp users to opt-out of Facebook using their information that was shared over WhatsApp. However, users who joined WhatsApp after the 2016 Policy, were not offered this option.

The 2016 Policy, was challenged by way of a writ petition and the matter is currently pending with the Supreme Court for hearing.

On 04.01.2021, WhatsApp announced an update to its Terms of Service and Privacy Policy (hereinafter referred to as “2021 Policy”). The 2021 Policy was also challenged before the High Court as well as the Hon’ble Supreme Court, and the said matters are still pending.

Considering the fact that as various writ petitions are filed against the WhatsApp’s privacy policy, the CCI initiated a suo moto case directing the Director-General, CCI (DG) to conduct an investigation in order to examine the potential abuse of dominance exercised by WhatsApp and Facebook.

An appeal lied against the order of the CCI by the Appellants, the learned Single Judge held that the CCI would not be divested of its jurisdiction that it possesses under the Act merely because an issue may be pending before the Supreme Court or the High Court. Furthermore, it was observed that the Order passed under Section 26(1) of the Act is purely administrative in nature and does not entail any consequence on the civil rights of the Appellants herein. Accordingly, the learned Single Judge dismissed the petitions filed by the Appellants herein.

The appellant filed an appeal before the High Court against the order of the single judge. The main contention of the appellant was that the issues with regard to WhatsApp’s Privacy Policy are already pending before the Supreme Court and the issues before CCI are identical and overlapping.

High Court Held

The High court dismissed the plea of the appellant and held that parallel inquiries by two different authorities in their respective spheres of adjudication is not uncommon and a slight overlap between inquiries does not mean that one must lead to ouster of other.

Therefore, in absence of any irreconcilable repugnancy between jurisdiction of both authorities, i.e. CCI and Constitutional Courts, CCI has liberty to proceed ahead with its investigation under section 26(1).

Investigation conducted by CCI will not be affected by outcome of proceedings pending before Apex Court and instant High Court.