Meta challenges CCI penalty on WhatsApp Privacy Policy before NCLAT

Meta Platforms Inc., the parent company of WhatsApp, Facebook, and Instagram, has contested a Rs 213.14 crore penalty imposed by the Competition Commission of India (CCI), arguing before the National Company Law Appellate Tribunal (NCLAT) that the order is legally flawed and goes beyond the scope of competition law, according to a Business Standard report.

The case stems from WhatsApp’s 2021 privacy policy, which allowed data sharing with Meta entities for uses beyond core messaging, such as targeted advertising. In November 2024, the CCI ruled that the update constituted abuse of dominance under Section 4 of the Competition Act, citing WhatsApp’s large Indian user base and limited alternatives. Alongside the penalty, the CCI barred WhatsApp from sharing user data with Meta for advertising for five years. In January 2025, the NCLAT partially stayed this ban, directing Meta to deposit half the penalty amount.

Representing Meta, Senior Advocates Kapil Sibal and Arun Kathpalia reportedly argued that the CCI strayed into privacy and data protection issues, which fall outside its mandate. They said the regulator had not conducted a market-effect analysis and maintained that data sharing was central to WhatsApp’s free-to-use model. Kathpalia added that user data should be seen as Meta’s property that supports innovation and small businesses. The lawyers also pointed to a May 2021 clarification from WhatsApp, noting users were not forced to delete their accounts if they declined the policy.

Meta further argued that the CCI’s order overlaps with ongoing proceedings in the Supreme Court in the Karmanya Singh Sareen case, which also examines WhatsApp’s privacy policy. The company said that once the Digital Personal Data Protection (DPDP) Act takes effect in 2025, it would override the CCI’s directions.

Defending the regulator, Advocate Samar Bansal said the CCI’s role is to address business practices and abuse of dominance, not individual privacy, the report noted. He argued that Indian users were not given an opt-out choice, unlike in Europe, making WhatsApp’s approach unfair. The CCI had also ordered Meta to provide clearer disclosures and prohibited linking WhatsApp access to mandatory data sharing.

The NCLAT bench, led by Justice Ashok Bhushan, is currently hearing Meta’s appeal, with a decision on interim relief awaited.