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Delhi HC gives Green Signal to CII to conduct investigation against FB & WhatsApp

Delhi High Court on Thursday quashed the FB & WhatsApp’s plea of barring Competition Commission of India (CII) from conducting investigation against them over data privacy issue. The Delhi HC’s judgement technically means that the CII has got a green signal to launch a prolong probe against both the social media platforms on the privacy matter.

Facebook CEO picture

Image Credits: Flickr Alessio Jacona

CII has justified the probe on the pretext that excessive data sharing between the two platforms goes against the competitive spirit and is a blatant attempt to create a monopolistic market. CII further argued that the excessive monopoly over data will erode the level playing and this will eventually make smaller and new players extremely vulnerable.

CII has categorically argued that “it needs to ensure regulations provide privacy protection without constraining young startups.”

Facebook, on other hand, argued in its petition that CII’s investigation is not needed since plethora of privacy policy cases are already pending in the Supreme court. However, Delhi HC dismissed this argument and also did not pay heeds to argument that CII’s investigation is also unnecessary because WhatsApp is Facebook’s subsidiary company.

Facebook’s new updated Policy & Public outrage

Facebook has been facing massive backlash ever since it announced a new updated privacy policy. This policy basically implied a data sharing agreement between Facebook and WhatsApp, where the latter will be permitted to share user’s data with Facebook. But following relentless criticism  WhatsApp was eventually forced to push the update to May 2021

With more than 300 Mn users, India is WhatsApp’s largest market but the market hardly contributes to Facebook’s bottom-line owing to lack of monetization strategy. WhatsApp had recently forayed into the payment market, albeit on a beta level, but its chances of succeeding is minimal given the ruthless competition.

Commenting on Delhi HC judgement, Ajay Data, Secretary General, ADIF said “The Delhi High Court’s order rejecting Facebook owned WhatsApp’s plea challenging investigation order by Competition Commission of India is a welcome development. We need to recognize the fact that privacy has been declared as a fundamental right. In India, data protection norms need to be at par with global standards.”

Rama Vedashree, CEO, Data Security Council of India said “Privacy has been declared as a fundamental right. This increases the obligation of the tech provider, whether it is a startup or a big company or a Government agency. Right now, there is a trust deficit among consumers which can be solved only if there is transparency about what is being done with user data.” She also added “Unlike Europe, Japan and many other countries India still does not have a comprehensive data protection legislation. Even though many of our startups are serving the global markets and making products for the world, our Digital startups face barriers in accessing global markets since we are not considered as an ‘adequate’ nation in the absence of data protection laws.

 

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