Clean chit: CCI dismisses ‘abuse of dominance’ plaint against WhatsApp

Our Bureau New Delhi | Updated on August 19, 2020

Sees no evidence of abusive conduct by messaging platform in the relevant market

Competition watchdog CCI has dismissed allegations of abuse of dominance by WhatsApp even as it concluded that the Facebook-owned messaging platform was indeed a ‘dominant player’ in the relevant market of ‘OTT messaging apps through smartphones in India’.

In its 41-page order, the Competition Commission of India said that no prima facie case of contravention of Section 4 (provision on abuse of dominance) exists against WhatsApp or Facebook.

A practising advocate, Harshita Chawla, had alleged that WhatsApp was using its dominant position in the ‘market for internet-based messaging application through smartphones’ to manipulate another market — ‘market for UPI-enabled digital payment applications in India’ — in its favour.

No merit

CCI saw no merit in the contention that pre-installation of WhatsApp payment App ‘WhatsApp Pay’ on users’ smartphones embedded within WhatsApp messenger App amounts to imposition of unfair term/condition on the user/consumer by a dominant entity, WhatsApp messenger.

Chawla was aggrieved that that the users of WhatsApp have been imposed with WhatsApp Pay to which they do not pay or download.

CCI also did not agree that WhatsApp was “bundling” its messaging services with the UPI enabled digital payment Apps and this was anti-competitive. CCI found no merit in the contention that such pre installation also amounts to leveraging of dominance by WhatsApp in the first relevant market (market for Internet based messaging application through smartphones in India).

On the informant’s claims that WhatsApp is in serious non-compliance of critical and mandatory procedural norms pertaining to data localisation and storage, the CCI said that they “do not seem to raise any competition concern and as such may not need any further scrutiny by it”.

Under competition law, a player can have a dominant position in a relevant market, but cannot abuse his dominance in that market to gain in the same market or any other relevant market.

Interestingly, the CCI observed that Facebook and WhatsApp undeniably deal with customer sensitive data which is amenable to misuse and may raise potential antitrust concerns among other data protection issues. However, in the present case, the Informant has only alleged that WhatsApp/Facebook have access to data which they are using for doing targeted advertising. There is neither any concrete allegation, nor any specific information to support the competition concern of the Informant, the CCI said. In the absence thereof, there is nothing on record which the Commission can examine, it added.

Published on August 19, 2020

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