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Delhi HC grants WhatsApp, Facebook extension to file replies to CCI in privacy policy probe

The messaging app’s new privacy policy notably expands on data sharing which has led to backlash and regulatory scrutiny.

The Delhi High Court on January 3 extended the time given to Facebook and Whatsapp to respond to notices sent to them by the Competition Commission of India (CCI), which is probing WhatsApp’s new privacy policy, The Hindu reported.

The Court was hearing the appeals of Facebook and WhatsApp challenging a single-judge order issued in April dismissing their pleas against the CCI probe. The bench of Chief Justice D.N. Patel and Justice Jyoti Singh adjourned the proceedings in the case to March 30 noting that the Data Protection Bill is yet to be finalised.

“Till then the time to file replies to the June 4 and June 8, last year, notices issued by CCI to the appellants [Facebook and WhatsApp] is extended.” – Delhi High Court

In a hearing in July, WhatsApp told the Delhi High Court that it has put its new privacy policy on hold until the data protection bill comes into force and it would not limit the functionality for users who haven’t agreed to the new privacy policy.

Facebook and WhatsApp have been at loggerheads with CCI on this issue since March last year. While WhatsApp is of the stance that CCI has no jurisdiction over privacy-related issues, CCI maintains that it is looking into how WhatsApp was using its dominant position in the market to force users to share information with Facebook, which is a competition issue. This latest extension is a relief for Facebook and WhatsApp as it halts the CCI probe in its tracks.

What arguments were made by WhatsApp, Facebook, and CCI?

  • WhatsApp: Senior advocate Harish Salve, representing WhatsApp, reiterated that WhatsApp will not enforce its privacy policy until the Data Protection Bill is enacted and that the company will conform to the provisions of the Bill. Salve also submitted that CCI should not continue with the probe because the matter is pending before the Supreme Court and other High Court courts. Salve added that the court had earlier granted until October 11, 2021, to file replies to CCI but that the company could not seek another extension because the matter was not taken up.
  • Facebook: Facebook’s counsel senior advocate Mukul Rohatgi stated that the company has filed an application to be excluded from the case as it was a separate legal entity from WhatsApp and should not be a party to the case because both WhatsApp and Facebook are controlled by Mark Zuckerberg. The court, however, has asked the company to file a fresh petition.
  • CCI: Additional Solicitor General Aman Lekhi, representing CCI, submitted the Data Protection Bill is “irrelevant” to the controversy and that the case does not deal with privacy but with concerns of abuse of dominant position, Live Law reported.

What is the new privacy policy?

The new policies, which were first notified in January 2021, are largely expanded and better-explained versions of their existing conditions, albeit with some additions. The most notable addition includes WhatsApp’s integration into the Facebook family of products and more data-sharing with Facebook. 

It allows WhatsApp to share any information identified in the policy’s extensive “Information We Collect” section. Additionally, messages to WhatsApp Business accounts could potentially be shared with third-party service providers, which could include Facebook itself.

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This free flow of data between Facebook apps would theoretically allow the company to understand user preferences and profiles, helping them improve their ad targeting algorithms.

In March, the CCI had taken up an investigation into the privacy policy suo motu to ascertain “the full extent, scope and impact” of data sharing under WhatsApp’s new privacy policy and terms of use. The Commission had said that WhatsApp has prima facie violated provisions of the Competition Act.

Timeline of key events

  • January 4, 2021: WhatsApp began alerting its users globally with an in-app notification about updates to its terms of service and privacy policies. It told users that those who do not consent to its changed policies will be unable to use the application after February 8, 2021.
  • January 14: A petition is filed in the Delhi High Court contended WhatsApp’s latest update to its privacy policy is an “absolute violation” of the right to privacy and gives the company a 360-degree profile of a person’s online activity.
  • January 16: After facing considerable backlash and finding itself in the middle of a heated debate about privacy, WhatsApp defers the application of its updated privacy policy by three months, giving users till May 15 to accept the new terms.
  • January 19: IT Ministry writes a letter to WhatsApp CEO Will Cathcart asking to withdraw proposed changes to WhatsApp’s terms and conditions.
  • February: WhatsApp starts displaying banners in the app with information about the changes to address the backlash.
  • March 24: The Competition Commission of India (CCI) orders an investigation to ascertain the “full extent, scope, and impact” of data sharing under WhatsApp’s new privacy policy and terms of use.
  • April 22: The Delhi High Court dismisses the writ petitions filed by WhatsApp and its parent company Facebook against the CCI’s investigation into the privacy policy update, allowing CCI to go ahead with its investigation.
  • May 7: WhatsApp said that it will not terminate user accounts after May 15, the deadline for accepting its new privacy policy.
  • May 10: Although WhatsApp said that it will not kick off users who don’t accept its new privacy policy by May 15, an Entrackr report reveals that users who don’t agree to reminders of the new policy will have their account severely restricted.
  • May 25: In a reversal on an earlier statement, WhatsApp says that it will not limit features to users who are yet to “agree” or provide consent to their new privacy policy, and will await the proposed Personal Data Protection (Bill) which is being deliberated by a parliamentary committee.
  • June 21: WhatsApp urges the Delhi High Court to stay CCI’s notice asking it to furnish information in relation to an investigation ordered by the regulatory body into the messaging app’s new privacy policy.
  • July 9: WhatsApp tells the Delhi High Court that it has put its new privacy policy on hold until the data protection bill comes into force and it would not limit the functionality for users who haven’t agreed to the new privacy policy.
  • January 3, 2022: The Delhi High Court extends the time given to Facebook and Whatsapp to respond to notices sent to them by CCI and adjourns the proceedings in the case to March 30 noting that the Data Protection Bill is yet to be finalised.

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