IN THE HIGH COURT OF DELHI AT NEW DELHI
Yashwant Varma, J.
Facebook India Online Services Private Limited - Appellant
Versus
Competition Commission Of India & Ors. - Respondents
W.P.(C) 14059 of 2022, CM APPLs. 42941 of 2022, 42942 of 2022
Decided On : 28-09-2022
Competition Act - Clubbing of Information - Section 26(1)
Fact of the Case:
The petitioner challenged the order of the Competition Commission of India (CCI) directing the Director General to commence an investigation by clubbing the information received with Suo Motu Case No. 01/2021. The petitioner, a subsidiary of Facebook Inc., was called upon to join the investigation. The CCI's order was based on the sharing of user data between WhatsApp, Facebook, and its subsidiaries, and the updated Privacy Policy of WhatsApp.
Finding of the Court:
The Court found that the clubbing of the petitioner's information with the Suo Motu Case was justified and imperative for the investigation, as it was necessary to examine the issues arising from the sharing of user data. The Court also noted that the CCI's order at the Section 26(1) stage was a preparatory measure and did not entail any civil consequences.
Issues: The main issue was the validity of the CCI's order directing the investigation by clubbing the petitioner's information with Suo Motu Case No. 01/2021.
Ratio Decidendi: The CCI's order at the Section 26(1) stage was a preparatory measure and did not require elaborate reasons for clubbing the information. The scope of the investigation covered the entire gamut of questions arising from the sharing of user data, including the petitioner's role as a subsidiary of Facebook Inc.
Final Decision: The writ petition and pending applications were dismissed, and the challenge to the CCI's order was found to be misconceived and lacking in merit.
JUDGMENT
Yashwant Varma, (Oral) J. - The petitioner has approached this Court assailing the order dated 12 October 2021 passed by the Competition Commission of India1 in exercise of powers conferred by Section 26 of the Competition Act, 2002 That order which directs the Director 1 Commission 2 the Act General to commence an investigation has essentially clubbed the information which had been received by the Commission along with Suo Motu Case No. 01/2021. Suo moto case
2. The Commission while considering the information which had been received by it, has in Para 2 of the impugned order observed thus:-
'2. The Commission considered the Information in its ordinary meeting held today and noted that the subject matter of the allegations made in the instant Information is substantially the same, which is currently under examination before the Director General ('DG') in the ongoing investigation in Suo Motu Case No. 01 of 2021. Accordingly, in terms of proviso to Section 26(1) of the Act, the Commission decided to club the present matter with Suo Motu Case No. 01 of 2021. No separate order or further direction is required to be passed on the instant Information and the same shall abide by the decision of the Commission in Suo Motu Case No. 01 of 2021. It is clarified that the scope of the Order dated 24.03.2021 passed under Section 26(1) of the Act, in Suo Motu Case No. 01 of 2021, remains unaltered by virtue of the clubbing of the present matter with Suo Motu Case No. 01 of 2021.'
3. Consequent to the aforesaid direction of the Commission, the Director General had issued a notice on 26 October 2021, calling upon the petitioner here to submit requisite information. The Suo Motu Case came to be registered by the Commission against WhatsApp LLC and Facebook, Inc. (now known as 'Meta Platforms, Inc'.). By an order of 24 March 2021, the Commission taking note of the issues which arose from the updated privacy policy and terms of service for WhatsApp users had proceeded to form the opinion that an investigation was merited. That order was challenged by WhatsApp LLC and Facebook, Inc. by way of writ petitions preferred before this Court being W.P.(C) 4378/2021 & W.P.(C) 4407/2021 which came to be dismissed on 22 April 2021. The judgment rendered by the learned Judge on the aforesaid writ petitions was thereafter assailed by WhatsApp LLC and Facebook, Inc. by way of Letters Patent Appeals being L.P.A. Nos. 163/2021 and 164/2021. Those Letters Patent Appeals were ultimately dismissed by a Division Bench of the Court in terms of the judgment rendered thereon on 25 August 2022.
4. While the present petitioner did not assail the order dated 12 October 2021, which is impugned in the present writ petition initially, it appears to have moved an application for impleadment in the aforenoted Letters Patent Appeals. While dealing with the said application for impleadment and the contentions which were addressed on behalf of the petitioner in those appeals, the Court entered the following observations: -
'48. With regard to the submissions on behalf of Facebook India Online Services Pvt. Ltd., this Court does not find any merit on the aspect of impleading the said party on account of the fact that the decision of the DG to issue notice to the Applicant, designating it as an 'Opposite Party', stems from the information it has secured from Internet Freedom Foundation in Case No. 30 of 2021 regarding its relevance in the investigation. The decision taken by the DG lies in the fact that a thorough investigation can only be conducted in the Applicant cooperates in the same.
49. Furthermore, it is not contemplated in law that a party should be impleaded at the stage of an appeal when it has not been a party to the matter at the stage when the decision from which the appeal arises has been given, and the remedy of the Applicant only lies by way of a writ against the Order by which it is aggrieved. The contention of Mr. Tripathi that the Applicant has chosen to imp
Competition Commission of India v. Steel Authority of India Limited (2010) 10 SCC 744
AI
The CCI's order at the Section 26(1) stage is a preparatory measure and does not require elaborate reasons for clubbing information. The scope of the investigation covers all aspects arising from the....
The Commission's directive for investigation under Section 26(1) is administrative, requiring no detailed reasons and justifying clubbing of related matters if substantial similarity exists.
The court emphasized that the order passed under Section 26(1) of the Act is purely administrative in nature and does not entail any consequence on the civil rights of the petitioner(s). It also high....
An error in the decision or determination itself may also be amenable to a writ of certiorari but it must be a manifest error apparent on the face of the proceedings, e.g. when it is based on clear i....
An order under Section 26(1) of the Competition Act is administrative, only initiating an investigation without affecting parties' rights.
Privacy policy imposing mandatory data sharing by dominant messaging app violates competition law via unfair conditions and market denial; remedies upheld except advertising ban; penalty on group jus....
Section 19(1) of the Act would show that the Act originally provided for the “receipt of a complaint” from any person, consumer or their association, or trade association.
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.