The National Company Law Appellate Tribunal (NCLAT), New Delhi Principal Bench, ruled that the conduct of WhatsApp playing dominance in the OTT messaging apps market in India, and compelling expanded user data sharing with Meta without opt-out and creating barriers via network effects and data integration, was rightly held by the Competition Commission of India (CCI) as abuse of dominance under section 4(2)(a)(i) and 4(2)(c) of the Competition Act. Accordingly, the related directions and penalties were upheld, while setting aside cease and desist directions and rejection of breach under section 4(2)(e) of the Competition Act, 2002.
The Tribunal noted that competition and data-protection laws were complementary, not exclusive, and both could operate simultaneously as they address distinct harms. The privacy laws safeguard personal data, while competition law curbs abuse of dominance through exploitative data practices. Accordingly, mere overlap does not oust CCI’s jurisdiction and its competence to examine competition harms linked with privacy issues, which has already been upheld by the Supreme Court and the Delhi High Court.
The Division Bench comprising Justice Ashok Bhushan (Chairperson) and Arun Baroka (Technical Member) observed that the CCI’s jurisdiction could not be excluded on grounds that it was testing competition issues on grounds of privacy and data, and they were entirely outside the realm of a competition regulator and would be covered either by SPDI Rules or DPDP Act or draft DPDP Rules framed thereunder. Accordingly, the Bench rejected the maintainability/ judicial-restraint objections raised by WhatsApp (appellants) based on the claim of repugnancy found between the Competition Act and the DPDPA/IT Rules.
The Bench found that the CCI conducted a detailed assessment of user behaviour, technological features, and market structure, recognising the core market as OTT messaging apps through smartphones, in line with economic realities shaped by consumer preferences and switching costs. Further, the CCI also analysed functional substitutability and proximity of competitors, distinguishing WhatsApp’s position within a distinct digital messaging app market that includes rivals like Telegram and Signal, alongside a complementary online display advertising market, both relevant for assessing dominance and abuse.
Thus, the Bench observed that the CCI rightly concluded that WhatsApp holds a dominant position in the OTT messaging apps market in India, with substantial entry barriers and competitive constraints resulting from its market share, network effects, consumer dependence, financial and technological resources, and ecosystem integration. The Bench therefore upheld the CCI’s order holding that WhatsApp’s 2021 Privacy Policy amounted to an abuse of dominance under section 4(2)(a)(i), as it imposed unfair and coercive conditions on users and compelled them to accept policy on a ‘take-it-or-leave-it’ basis by threatening loss of service access, thereby vitiating free consent.
The Bench also noted that Meta exercised 100 per cent control over WhatsApp and conduct of Meta group resulted in denial of market access, covered under section 4(2)(c). Thus, the CCI’s order holding breach of section 4(2)(e) was not sustainable as there was no clear proof of leveraging conduct distinct from other established abuses. Ultimately, the findings under sections 4(2)(a)(i) and 4(2)(c) were to be upheld, as they directly related to coercive data-sharing and market foreclosure. However, directions issued by CCI to cease and desist were not sustainable and were to be set aside.
Briefly, the Appellants, Meta Platforms and WhatsApp, challenged CCI’s order, which, after DG investigation into WhatsApp’s 2021 Privacy Policy update, found contraventions under section 4 of the 2002 Act, and imposed a penalty. Further, WhatsApp’s 2021 update mandating acceptance of revised privacy terms led CCI to find abuse under sections 4(2)(a)(i), 4(2)(c) and 4(2)(e) and to impose a penalty of Rs. 213.14 crore along with conduct remedies. The Appellants contended that CCI lacked jurisdiction since data-sharing and consent issues fell within the Digital Personal Data Protection Act, 2023 (DPDP Act) and SPDI Rules.
Cases Relied On:
Meta Platforms Inc v. Competition Commission of India [2022] 143 taxmann.com 391
Flipkart Internet (P.) Ltd. v. Competition Commission of India [2021] 128 taxmann.com 363 (Karnataka)
Asian Paints Ltd. v. Competition Commission of India [2025] 178 taxmann.com 417 (Bombay)
Competition Commission of India v. Fast Way Transmission (P.) Ltd. [2018] 92 taxmann.com 243
Cases Distinguished:
Vinod Kumar Gupta v. Competition Commission of India [Competition Appeal No. (AT) 13 of 2017]
Winzo Games (P.) Ltd., In re [2024] 168 taxmann.com 687
Competition Commission of India. v. Bharti Airtel Ltd. [2018] 100 taxmann.com 163
Appearances:
Senior Advocates Mukul Rohatgi and Arun Kathpalia, along with Advocates Yaman Verma, Shashank Mishra, Aisha Khan, Shivek Endlaw, Parv Kaushik, Aditya Dhupar, Devanshi Singh, Udit Dedhiya, Bani Brar, Tahira Kathpalia and Vedika Rathore, for the Appellant
Senior Advocate Balbir Singh, Kapil Sibal and Amit Sibal, along with Advocates Samar Bansal, Saurabh, Abir Roy, Vivek Pandey, Devika Singh Roy Chowdhary, Ahmed Jamal Siddiqui, Abhishek Gandhi, Kshitiz Kishor Rai, Manu Chaturvedi, Naval Chopra, Supritha Prodaturi, Akshi Rastogi, Parinita Kare, Aatmik Jain, Ritika Bansal, Anupma Reddy Eleti, Aparajita Jamwal, Saksham Dhingra, Aman Shankar, Sasthibrata Panda, Biyanka Bhatia, Shreya Kapoor, Bhivali Shah, Dinesh Chandra, and Sonia Dutta, for the Respondent
