WhatsApp Privacy Policy Places Users In “Take It Or Leave It” Situation: Delhi HC

• ByStartupStory     |    August 27, 2022

The Competition Commission of India (CCI) ruling ordering a probe into the messaging applications’ new privacy policy was rejected by the Delhi High Court on Thursday. The court noted that the order places its users in a “take-it-or-leave-it” predicament. The court ruled that the new WhatsApp privacy policy effectively persuades its users into accepting it by giving them the illusion of choice before sharing their sensitive data with the Facebook firms specified in the policy, according to a report.

“The Court finds merit in the submission of the ASGs that appeared for CCI that one of the key issues with the 2021 Policy is its propensity to share the data of its users with Facebook Inc., the parent company of WhatsApp. Solely for the reason that the policies itself do not emanate out of Facebook Inc.The Appellant cannot hide behind the fact that it is the direct and immediate beneficiary of the data sharing mechanism envisaged by the policies.”said Justices Satish Chander Sharma and Subramonium Prasad in their detailed decision.

Furthermore, the Delhi High Court stated that “it is not in dispute that WhatsApp occupies a dominant position in the relevant product market and that there exists a strong lock-in effect which renders its users incapable of shifting to another platform despite dissatisfaction with the product – as is exemplified by how, despite an increase in the downloads of Telegram and Signal when the 2021 Policy was announced, the number of users of WhatsApp have remained unchanged.”

The report said,to ensure retention of its user base and to prevent any other disruptive technology from entering the market, data is utilised by tech companies to customise and personalise their own platforms so that its user base remains hooked and when data concentration is seen through this prism, it does give meaning to the new adage that “data is the new oil”, and, as noted in the CCI Order dated March 24, 2021, it raises competition concerns because it prima facie amounts to imposition of unfair terms and conditions upon its users, thereby violating Section 4(2)(a)(i) of the Act.

Notably, Facebook and WhatsApp claimed that the CCI was not required to launch the investigation because the Supreme Court and High Court were already hearing arguments about WhatsApp’s privacy policy.

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