Supreme Court dismisses WhatsApp’s plea to stay CCI probe into its privacy policy

The court refused to accept the petitioners' contentions that the Competition Commission of India was inquiring without jurisdiction into the validity of Whatsapp's privacy policy.

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A division bench of the Supreme Court earlier today dismissed petitions filed by instant messaging freeware service company WhatsApp LLC and its parent company, the technology company Meta Platforms Inc., seeking to stay a probe by the Competition Commission of India ('CCI') into WhatsApp's privacy policy.

The bench comprised Justices M.R. Shah and Sudhanshu Dhulia.

Background

In March last year, CCI ordered an investigation by its Director-General ('DG') into WhatsApp's updated privacy policy, on the basis of its finding that WhatsApp had abused its dominant market position to coerce its 350 million users in India to accept its new policy, with no scope of opting out.

It had observed, "The conduct of WhatsApp in sharing of users' personal data with other Facebook companies, in a manner that is neither fully transparent nor based on voluntary and specific user consent, appears prima facie unfair to users." This order was challenged by WhatsApp before the Delhi High Court, but a single-judge bench of the high court dismissed the petition in May. That same month, WhatsApp filed an appeal against this order before a division bench of the high court. The division bench of the high court had dismissed this appeal in August, paving the way for the CCI DG to probe the policy.

Whatsapp and Meta challenged, via a special leave petition ('SLP'), the high court division bench's dismissal order at the Supreme Court last month.

What transpired in the court today

The SLP was heard for admission by the Supreme Court today.

Senior advocate Kapil Sibal, appearing for Whatsapp, brought to the attention of the division bench that a Constitution bench of the Supreme Court was already hearing petitions challenging Whatsapp's privacy policy, with the matter listed for final disposal in January next year. He further contended that in light of a personal data protection bill being introduced in the Parliament's upcoming winter session, the CCI must not pass any final orders in the matter.

Senior advocate Mukul Rohatgi, representing Meta, submitted that there was a jurisdictional bar on the CCI.

However, the bench rejected these contentions, holding that the CCI is an independent statutory body, the proceedings of which cannot be stopped. It opined that the petitioners should directly approach the CCI if they had any concerns about the outcome of its investigation.

Additional Solicitor General of India, N. Venkatraman, appearing for the CCI, averred that there was no question of jurisdictional overlap with the Supreme Court, since the Commission was only examining the issue of abuse of dominance due to Whatsapp's privacy policy. He affirmed that the CCI was not enquiring into any constitutional question. He also pointed out that Whatsapp's pleas had been rejected by both the single and division benches of the Delhi high court.

Refusing to admit the SLP, the Supreme Court's division bench held that the CCI cannot be restrained from proceeding with a probe into alleged violations of the Competition Act, 2002. Since the CCI had prima facie opined that the privacy policy had violated the Act and initiated the probe on the basis of the same, the probe was well within its jurisdiction, and must be required to be completed at the earliest, concluded the court.

Union Government has also asked for withdrawal of privacy policy

In May last year, the Union Ministry of Electronics and Information Technology had directed WhatsApp to withdraw its new privacy policy. In this communication, the Ministry stated that the changes to WhatsApp's privacy policy and the manner of introducing the said changes undermine the sacrosanct values of informational privacy, data security and user choice and harm the rights and interests of Indian citizens. It reiterated that the policy violates several provisions of existing Indian laws and rules.