SC refuses to halt CCI probe into WhatsApp privacy policy

A bench of justices M.R. Shah and Sudhanshu Dhulia, while dismissing the social media giants’ appeals against an August Delhi high court order, said that CCI, as an independent authority, can look at any violation of the Competition Act.

It said that when CCI has prima facie noted that it is a case of violation of the 2002 Act and proceedings have started, it cannot be said that the initiation of the CCI proceedings is without jurisdiction.

“The precedent of the Supreme Court has held that the proceedings before the CCI are required to be completed at the earliest. In view of the above, the CCI cannot be restrained from proceeding further with the inquiry or investigation for the alleged violation of the Competition Act. All the contentions available to the parties are kept open,” said the court.

It also clarified that observations made by the Delhi high court or by CCI at the stage of the commencement of the probe would be considered “tentative and prima facie”.

Meta challenged a 25 August order of the Delhi high court, allowing CCI to probe WhatsApp’s new privacy policy.

The high court held that “WhatsApp’s new privacy policy shares sensitive data with Facebook (now Meta) and virtually forces users into an agreement by providing a mirage of choice”.

“The 2021 [privacy] policy, however, places its users in a “take-it-or-leave-it” situation, virtually forcing its users into an agreement by providing a mirage of choice, and then sharing their sensitive data with Facebook companies envisaged in the policy,” the court had said, refusing to stop the probe.

Challenging the high court judgment, WhatsApp, represented by senior advocate Kapil Sibal told the Supreme Court on Friday that a constitution bench of the apex court is hearing matters on the validity of the privacy policy of WhatsApp and therefore, CCI must be stopped from ruling on the same issue.

He added that the constitution bench matter will now be taken up in January in view of a statement made by the Solicitor General that a new data protection bill is going to be introduced in the winter session of the Parliament.

Sibal requested the Supreme Court to direct CCI to either defer its proceedings or refrain from passing final orders till the top court adjudicates on the privacy policy matter.

But the bench was unwilling to do so. “How can we stay the investigation? We will not restrain them from proceeding in the matter. They function under a statute, and we do not know if there is any connection between the two matters…CCI is an independent agency to consider the relevant provisions. Proceedings before CCI cannot be stalled,” responded the SC bench.

Appearing for CCI, additional solicitor general N. Venkatraman said the companies have been trying incessantly to get the proceedings stayed by approaching every possible forum. Venkatraman contended that the constitution bench is examining the WhatsApp policy on the anvil of privacy rights, whereas CCI is looking into the abuse of dominant status through sharing of data. “We are a market regulator. We will continue investigating even if the court were to hold their policy as an invasion of privacy or otherwise. Abuse and dominance are what we are investigating,” said Venkatraman.