India’s fair trade regulator, the Competition Commission of India (CCI), has “mistakenly” defined the relevant market, and Meta Platforms argues that the CCI has failed to pinpoint any actual behavior by Meta that has, or would have, restricted rivals’ market access. This defense was presented to the National Company Law Appellate Tribunal (NCLAT) on Monday.
Senior Advocate Amit Sibal, representing Meta, asserted that the CCI’s entire legal challenge is built on speculation about future actions and theoretical situations, rather than concrete evidence.
Sibal emphasized that this approach falls short of the legal requirements under Section 4(2)(c) of the Competition Act, which mandates that any finding of infringement must be based on conduct that has already happened or is currently ongoing. He further argued that the CCI presented no actual evidence of how WhatsApp’s 2021 Privacy Policy update specifically impacted the online display advertising market.
“The CCI has not demonstrated how the restricted sharing of data from particular optional features with Meta—such as those linked to ‘Click-to-WhatsApp Ads’—has adversely affected competitors in the online display advertising market,” Sibal stated during the NCLAT proceedings.
Furthermore, Sibal highlighted that the CCI failed to consult even one advertiser regarding the array of services available in the advertising sector and their interchangeability.
“Consequently,” he argued, “the CCI wrongly identified an excessively narrow ‘online display advertising’ market, which improperly excludes other readily substitutable services like online search advertising.”
The NCLAT is currently reviewing a petition filed by the tech giant, which disputes a substantial penalty of ₹213.14 crore levied against the social media company for alleged anti-competitive practices related to its 2021 WhatsApp privacy policy update.
Meta also contended that the CCI’s market definition overlooks offline advertising, which, due to recent technological progress, serves as a strong alternative to online advertising.
According to Meta, the CCI dismissed testimonies from competitors like Google and Amazon, which presented evidence contradicting the regulator’s findings.
Sibal is scheduled to resume his arguments on Tuesday.
Earlier on Monday, Senior Advocate Arun Kathpalia, representing WhatsApp, completed his submissions.
WhatsApp has previously argued that the CCI lacks the authority to rule on data safety matters and maintained that its 2021 data sharing policy is consistent with its 2016 privacy policy.
The CCI is set to present its counter-arguments on September 18 and 19.
Notably, in January of this year, the appellate tribunal temporarily halted the CCI’s five-year prohibition on data-sharing between WhatsApp and Meta for advertising, providing a temporary reprieve for the tech behemoth.
In November, the CCI had initially imposed a significant penalty of ₹213.14 crore on Meta, citing unfair business practices related to the 2021 WhatsApp privacy policy update.
Both Meta Platforms and WhatsApp subsequently appealed this order to the NCLAT, which functions as the appellate body for CCI decisions.
In its comprehensive 156-page order issued on November 18, 2024, the CCI had explicitly instructed Meta to stop all alleged anti-competitive behaviors.
The CCI’s order also mandated that Meta and WhatsApp implement specific behavioral remedies within a set timeframe to resolve the identified anti-competition concerns.
These remedial measures included a five-year ban on WhatsApp sharing user data collected on its platform with other Meta-owned companies or products for advertising.
Additionally, the CCI stipulated that sharing WhatsApp user data with other Meta companies or products for any purpose other than providing WhatsApp services could not be a prerequisite for Indian users to access WhatsApp.