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Delhi High Court Refuses To Stay CCI Probe Against WhatsApp's Privacy Policy

Shreya Agarwal
23 Jun 2021 5:53 AM GMT
Delhi High Court Refuses To Stay CCI Probe Against WhatsApps Privacy Policy
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The Delhi High Court has refused to stay the Competition Commissionof India's (CCI) enquiry against WhatsApp's new privacy policy. A vacation division bench of Justices Anup Jairam Bhambhani and Jasmeet Singh was hearing an appeal by WhatsApp and its parent company Facebook Inc against a single bench order declining to interfere with CCI's investigation. Appearing for WhatsApp, Sr....

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The Delhi High Court has refused to stay the Competition Commissionof India's (CCI) enquiry against WhatsApp's new privacy policy.

A vacation division bench of Justices Anup Jairam Bhambhani and Jasmeet Singh was hearing an appeal by WhatsApp and its parent company Facebook Inc against a single bench order declining to interfere with CCI's investigation.

Appearing for WhatsApp, Sr. Adv. Harish Salve informed court that they were moving the vacation bench as they have been served with a notice by the CCI on Jun 4 to provide information as sought by it on a questionnaire for its enquiry and that the deadline to provide the same gets over tomorrow. In the absence of submission of such information, WhatsApp may be slapped with a statutory penalty.

He submitted that they have been served the notice despite having informed the CCI that of their decision to defer implementation of the policy beyond May 15, and further, that their challenge to the single bench's order refusing to interfere with the CCI enquiry is still pending before the division bench of the Delhi High Court.

The court held that, "there is no doubt that the issuance of impugned notice dated 04.06.2021 by the DG is a step in furtherance of the investigation...., which investigation is subject matter of the challenge in the present LPA." However, the court said that an application seeking stay of further steps in the investigation already stands filed before the Chief Justice in another matter, on which notice has already been issued to the DG; in which no interim relief was given by the Division Bench on 06.05.2021 or thereafter; and which is already listed before the Division Bench (Roster Bench) for further consideration on 09.07.2021."

Considering "substantial overlap, in fact near identity," between the prayers in both the applications, the court decided not to grant any stay on operation of the Jun 4 CCI notice, at this stage.

Seeking interim protection from the court against any such precipitative action, Salve had informed the court that, "The 2021 policy does not radically change the 2016 policy but only updates it." Referring to the Personal Data Protection Bill which deals with the subject matter and is pending approval before the Parliament, he further pressed that the CCI is attempting to get into "what the Government of India is already looking into."

He was supported by Sr. Adv. Amit Sibal also appearing for WhatsApp, who apprised the Court that the matter before the Division Bench had been adjourned twice due to non-availability of the bench and currently stood adjourned to Jul 09.

CCI Orders Probe Into WhatsApp's New Privacy Policy; Finds Prima Facie 'Abuse Of Dominance'

Representing the Competition Commission of India, Addl. Solicitor General Aman Lekhi argued that according to the Act, the enquiry has to be completed within a week of the order, and that WhatsApp and Facebook had had 4 opportunities to ask for a stay on the enquiry in their appeal before the Division Bench, however, they had not pressed for it.

Refuting WhatsApp and Facebook's argument that the High Court and Supreme Court were already seized of the issue of privacy in the cases of Karmanya, Chaitanya Rohilla and Seema Singh, Lekhi submitted that while these cases dealt with the concern of privacy, the CCI is in fact looking into the issue of competition, economic facets and the aspect of use of data as a resource.

He added, "At a stage of inquiry, the furnishing of information will not lead to any orders to the detriment of any party; in fact, it may work to their advantage," as the report may find them not violating anti-trust norms.

Sr. Adv. Mukul Rohatgi for Facebook argued that there was overlapping of issues before the Supreme Court, the High Court and the CCI and stated that the CCI's examination of the matter was therefore impinging on constitutional propriety. He raised the question, "When the highest court of the land is examining the issue, can an administrative authority get into it?"

He also said that the CCI's proceeding in the matter despite the notice by the Division Bench was akin to an attempt to upstage the High Court's proceedings instead of waiting till Jul 09, when the bench would hear the matter.

Upon Lekhi's submission that WhatsApp could submit the information as required as no action could be taken until the submission of the report, which would not be submitted by Jul 9 in any case, the bench asked Lekhi if he could ensure that from now till Jul 9, the CCI would not take any precipitate action while legal challenges are pending. Taking instructions, Lekhi submitted that the bench may direct WhatsApp to submit the required information as the report was not going to be submitted until Jul 9, and assured the court that "there is no threat hanging over the heads of the appellants, as only after the report is submitted any further steps will follow."

However, refusing to get into the case's merits, especially since the matter is pending before the bench of the Chief Justice, the court re-notified the case for the roster bench.

According to submissions in court, the Ministry of Electronics & IT (MeitY) which administers the IT Rules, 2021 governing WhatsApp's policy, has sent a letter to WhatsApp stating that, "The deferral of the privacy policy beyond May 15, 2021, does not absolve WhatsApp from respecting the values of informational privacy, data security and user choice for Indian users. The changes to the Privacy Policy and the manner of introducing these changes, including in FAQ, undermines these sacrosanct values and harms the rights and interests of Indian citizens. As you are doubtlessly aware, many Indian citizens depend on WhatsApp to communicate in everyday life. It is not just problematic, but also irresponsible, for WhatsApp to leverage this position to impose unfair terms and conditions on Indian users, particularly those that discriminate against Indian users vis-a-vis users in Europe."

Click here to read/download the order




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