The National Company Law Appellate Tribunal (NCLAT) has issued a landmark ruling allowing WhatsApp to share user data with other Meta group companies for advertising purposes, overturning a significant part of the earlier verdict by the Competition Commission of India (CCI). At the same time, it upheld a penalty of ₹ 213.14 crore against Meta and WhatsApp. Live Law
What the Ruling Says
- In November 2024, the CCI found that WhatsApp’s 2021 privacy policy update unfairly forced users to accept expansive data sharing with Meta group entities, and imposed a five-year ban on such data sharing for advertising purposes, along with the ₹213.14 crore penalty.
- On 4–5 November 2025, NCLAT partly overturned the CCI order: it set aside the direction that prohibited WhatsApp from sharing user data for ads with Meta for five years, and it also set aside the finding that Meta had abused dominance in one market to protect another (Section 4(2)(e)).
- However, NCLAT upheld the penalty of ₹ 213.14 crore and sustained the finding that WhatsApp imposed unfair conditions (Section 4(2)(a)(i)) on users by making broad data sharing compulsory.
- The tribunal also emphasised that while dominance per se is not unlawful, imposing unfair or discriminatory conditions is an abuse.
Why It Matters
For Privacy & Data-Governance
- The ruling signals that Indian competition regulators may no longer block data-sharing arrangements simply on the basis of grouping for advertising if broader evidence of market abuse is missing.
- On the flip side, it reaffirms that even major tech firms can be penalised for “take-it-or-leave-it” policies which reduce user autonomy.
- It underscores the overlapping but distinct roles of competition law and data-protection regimes in India’s evolving digital regulation landscape.
For WhatsApp & Meta’s Business
- With the five-year ban removed, Meta regains flexibility in using WhatsApp’s data artifacts to fuel its advertising ecosystem (Facebook, Instagram etc) in India.
- That could strengthen Meta’s value proposition to advertisers who want cross-platform targeting via WhatsApp interactions.
- Yet Meta remains under scrutiny and liable to global regulatory risk, so while relief is substantive, the lens remains on its future conduct.
For the Indian Digital Advertising Market
- Advertising players and platforms relying on user data for targeting may view this as a favourable sign of regulatory clarity for cross-platform data‐sharing business models.
- It may influence how other apps and platforms structure opt‐in/opt‐out flows, user consent and data sharing, particularly in India’s large user base.
Key Implications & Considerations
- User consent & opt-out: Although the ban is lifted, NCLAT maintained that users must be given meaningful choice, transparency on what data is shared and purposes of sharing.
- Dominance and market leverage: The finding of dominance in messaging for WhatsApp was upheld, but Meta’s leveraging across to display advertising (Section 4(2)(e)) was struck down by NCLAT as unsustainable.
- Regulatory interplay: With the upcoming Digital Personal Data Protection Act (DPDP) regime and potential Digital Competition Law in India, this case may set precedent for how data sharing is treated under competition law.
- User trust & brand impact: For WhatsApp, regaining data‐sharing ability may also bring reputational risk regarding privacy and user trust; how they manage disclosure may become important.
- Global context: Meta faces regulatory action in other jurisdictions (EU, U.S.), so Indian relief may be balanced against global compliance pressure.
What Next?
- The detailed written order from NCLAT will clarify implementation timelines, any conditions on data sharing, and how user opt‐in/opt‐out must be handled.
- WhatsApp/Meta may revise privacy policies and user flows in India to align with the ruling, incorporating clearer disclosures and consent mechanisms.
- The regulator (CCI) and digital policy makers may examine whether new rules or guidelines are required for user data sharing, cross-platform targeting and ecosystem fairness.
- Other big tech platforms operating in India (Google, Amazon etc) may reassess their data‐sharing strategies to align with this precedent and regulatory expectations.
Conclusion
The NCLAT’s decision marks a significant regulatory turning point: while data‐sharing by WhatsApp with Meta for advertising is now permitted, the message is clear—business models must respect user choice, transparency and fairness. For users, regulators, advertisers and platforms in India, the ruling will have broad ripple effects in how data is leveraged for targeted advertising in the years ahead.
