This article is part of the UPSC Daily Editorial Analysis, covering The Hindu editorial – " The challenge of policing digital giants," published on 21st March, by the best UPSC coaching in Kolkata.
Syllabus: UPSC GS Paper 2 (Governance, Regulatory Bodies and Policy Interventions)
The regulatory scrutiny faced by Meta and Google in India highlights the broader global concerns about the market dominance of digital tech giants across the world. The Competition Commission of India (CCI) has played a major role in addressing anti-competitive practices but these issues are not unique to India.
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Aspect |
Details |
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Establishment |
Statutory body under the Competition Act, 2002 to ensure fair and healthy competition in economic activities. |
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Role & Objective |
Acts as an antitrust watchdog, preventing abuse of dominant position by companies. |
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Need for CCI |
???? Protection against market distortions |
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Composition |
???? Quasi-judicial body with one Chairperson and six members |
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Functions |
???? Eliminate anti-competitive practices |
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Appeals Process |
Appeals against CCI rulings go to the National Company Law Appellate Tribunal (NCLAT) under the Companies Act, 2013. |
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Amendments |
???? Competition (Amendment) Act, 2007 refined the Competition Act, 2002 |
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Anti-Competitive Practices |
???? Foreclosing competition |
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Evaluation of CCI’s Performance |
???? Improved from the Monopolies and Restrictive Trade Practices Act, 1969 |
Recently, the Competition Commission of India (CCI) imposed a fine of ₹213.14 crore on Meta. Further it imposed a five-year ban on sharing user data from WhatsApp with other Meta platforms like Facebook and Instagram for advertising purposes. The order was issued in response to WhatsApp’s 2021 privacy policy update.
In 2021 WhatsApp's updated privacy policy gave a mandate that data sharing with Facebook (now Meta) and its subsidiaries is compulsory for business communications. This sparked concerns over privacy. Users had had to accept the policy to continue using the app. Personal chats remained end-to-end encrypted but the update clarified WhatsApp's data collection, including profile details, IP addresses and usage logs. The Competition Commission of India (CCI) fined Meta for its unfair "take-it-or-leave-it" approach by concluding that it imposed unfair conditions on users. Amid backlash and misinformation, many users migrated to Signal and Telegram. Meta then gave a statement that businesses might use collected data for ads but WhatsApp itself wouldn’t do that. WhatsApp has since then introduced further updates, including Meta AI messaging, enhanced calling features and secure contact storage.
Meta challenged the order before the National Company Law Appellate Tribunal (NCLAT). Next, NCLAT granted a stay on the five-year ban and penalty in January 2025, contingent upon Meta depositing 50% of the penalty.
We are in a digital economy of the 21st century where data has become a key determinant of market dominance. Data is infinitely reusable and it serves as a foundational asset for tech companies. Meta like other digital platforms uses large-scale data collection to enhance its algorithms, deliver personalized advertising and create a self-reinforcing network effect that strengthens its competitive edge while making it difficult for new entrants to compete.
Meta is not the only company facing regulatory scrutiny in India. In 2022, the CCI fined Google ₹1,337.76 crore for abusing its dominance in multiple markets including:
Google was found guilty of mandating the pre-installation of its applications on Android devices--- a practice upheld by the NCLAT in 2023.
The regulatory concerns surrounding Meta and Google are not unique to India but reflect global antitrust challenges.
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Region |
Antitrust Cases and Rulings |
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United States |
Meta faces antitrust litigation over its acquisitions of Instagram and WhatsApp. Google was sued for monopolistic practices. In 2024, the U.S. District Court for the District of Columbia ruled against Google under the Sherman Act, citing its exclusive agreements in search and advertising markets. |
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European Union |
The Bundeskartellamt (Federal Cartel Office) of Germany ruled that Meta violated EU competition laws and the General Data Protection Regulation (GDPR) by combining user data across platforms without explicit consent. |
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Australia |
The Australian government has introduced measures to curb digital platform dominance and protect competition in online markets. |
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Other Notable Cases |
AT&T (U.S.): Forced to divest 22 operating companies to dismantle its monopoly. |
India’s Competition Act, 2002 focuses on price-based dominance and lacks explicit provisions to address data-centric monopolies. We know that digital market dominance is often derived from data aggregation rather than pricing strategies. So the Act requires amendments to include data monopolization as a market dominance criterion.
Key reforms should include:
Digital Personal Data Protection Act of 2023 provides a legal framework for data collection, consent as well as its usage. However the lack of coordination mechanisms between the CCI and the Data Protection Board of India basically limits its effectiveness in addressing competition concerns that are related to data exploitation.
A possible solution for India is to adopt an integrated approach similar to the EU’s Digital Markets Act (DMA) and GDPR, to comprehensively regulate data privacy and competition law.
The 2024-25 Economic Survey highloghted the role of artificial intelligence (AI) and digital transformation. As our digital markets evolve India must ensure that its regulatory frameworks needs to catch up with but also anticipate new challenges that are posed by emerging technologies and growing market concentration.
We need to modernize competition law to effectively tackle data-driven monopolies and promote fair competition in the digital economy.
READ ABOUT CCI: https://www.iasgyan.in/daily-current-affairs/competition-commission-of-india-cci
READ ABOUT Digital Personal Data Protection Bill 2023: https://www.iasgyan.in/daily-current-affairs/digital-personal-data-protection-bill-2023#:~:text=The%20Bill%20requires%20entities%20that,accuracy%2C%20storage%20limitation%2C%20etc.
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PRACTICE QUESTION Q. Assess the challenges of regulating data-driven monopolies in India. How effective are existing competition laws and what reforms are needed? |
1. Why is Meta facing regulatory scrutiny in India?
Meta was fined ₹213.14 crore by the CCI for abusing its dominance by sharing WhatsApp user data across its platforms.
2. What action did the National Company Law Appellate Tribunal (NCLAT) take on Meta’s case?
NCLAT stayed the five-year ban and penalty, requiring Meta to deposit 50% of the fine.
3. Why is data considered a tool for market dominance?
Data fuels personalized advertising and strengthens network effects, making competition harder for new entrants.
4. What were Google’s violations in India?
Google was fined ₹1,337.76 crore for mandating pre-installed apps on Android devices and abusing its dominance in multiple markets.
5. How have other countries regulated tech giants?
The U.S., EU and Australia have taken antitrust actions, enforcing stricter data privacy and competition laws.
6. What are the key limitations of India’s Competition Act, 2002?
It focuses on price-based dominance but lacks provisions to address data-driven monopolies.
7. How can India strengthen its competition laws?
Reforms should include redefining market power, mandating interoperability and enforcing data-sharing regulations.
8. What role does the Digital Personal Data Protection Act, 2023 play?
It regulates data collection and consent but lacks coordination with competition authorities.
9. How does India’s regulatory approach compare to global standards?
India lags behind the EU’s Digital Markets Act and GDPR, which provide stronger data and competition regulations.
10. What is the future of digital regulation in India?
India must modernize its laws to address AI-driven market dominance and ensure fair competition.
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