NCLAT suspends WhatsApp-Meta data sharing ban

The National Company Law Appellate Tribunal (NCLAT) on Thursday temporarily suspended the Competition Commission of India’s (CCI) five-year ban on data sharing between WhatsApp and its parent company, Meta Platforms. The ban also extended to other Meta entities like Facebook and Instagram for advertising purposes.

Background of the Case:

  • The CCI’s November directive prohibited WhatsApp from sharing user data with Meta entities for advertising, citing antitrust concerns.
  • Meta argued that the ban would severely impact its business model in India, potentially leading to a rollback or suspension of some WhatsApp features and limiting personalized advertising on Facebook and Instagram.

Tribunal’s Interim Decision:

  • NCLAT put the CCI’s ban on hold while hearing Meta and WhatsApp’s appeal against the order.
  • The tribunal acknowledged that the ban “may lead to a collapse” of WhatsApp’s business model in India.
  • WhatsApp must provide users with an opt-out option for its 2021 privacy policy update, as directed by the November antitrust ruling.

Meta’s Response:

  • A Meta spokesperson welcomed the interim ruling, stating that the company will “evaluate next steps.”

The ruling provides temporary relief for Meta and WhatsApp, ensuring their current business operations remain unaffected while the appeals tribunal continues to deliberate the case.