NCLAT Stays Ban on WhatsApp Data Sharing with Meta

New Delhi, Jan 23 (PTI) The National Company Law Appellate Tribunal (NCLAT) on Thursday stayed a five-year data-sharing ban imposed by competition watchdog CCI on data-sharing practices between WhatsApp and its parent Meta for advertising purposes, offering a breather to the tech giant.

Meta had challenged the Competition Commission of India's (CCI) directive issued in November 2024 that imposed a ban on data sharing between WhatsApp and other Meta entities for advertising purposes, warning it may have to roll back some features. It had also slapped a Rs 213 core penalty on Meta for abuse of its "dominant position."

CCI had also concluded that WhatsApp's 2021 privacy policy update unfairly compels users to agree to wide collection of data and its sharing within Meta group.

NCALT suspended the ban during the time it hears Meta's challenge to the antitrust ruling.

NCLAT will next hear the case on March 17.

Meta welcomed the "NCLAT's decision to grant a partial stay on the Competition Commission of India's (CCI) order" and said it will evaluate next steps.

"While we will evaluate next steps, our focus remains on finding a path forward that supports millions of businesses that depend on our platform for growth and innovation as well as providing high-quality experiences that people expect from WhatsApp," a Meta spokesperson said.

In November, the CCI imposed a penalty of Rs 213.14 crore on social media major Meta for unfair business ways with respect to the WhatsApp privacy policy update done in 2021.

Meta Platforms and WhatsApp had challenged this order before the NCLAT, which is an appellate authority over the orders passed by the CCI.

In its 156-page order, the CCI had on November 18, 2024, directed Meta to cease and desist from anti-competitive practices.

According to that CCI order, Meta and WhatsApp have also been asked to implement certain behavioural remedies within a defined timeline to address the anti-competition issues.

The regulator called for implementing various remedial measures, including barring WhatsApp from sharing data collected on its platform with other Meta companies or Meta company products for advertising purposes for five years.

Among other directions, CCI had said that sharing of user data collected on WhatsApp with other Meta companies or Meta company products for purposes other than for providing WhatsApp services shall not be made a condition for users to access WhatsApp services in India.