The Competition Commission of India (CCI) has set aside an antitrust complaint against WhatsApp, over the alleged use of its dominant position to expand in the UPI-enabled digital payments segment.
The complainant had alleged that Facebook-backed WhatsApp, by using its dominance in the Internet-based instant messaging space, is bundling its messaging app with the payments option – WhatsApp Pay – thereby using such dominance to penetrate into the UPI-enabled digital payments app market.
Further, by enabling automatic installation of WhatsApp Payments App in the WhatsApp Messaging App, WhatsApp is alleged to be taking advantage of its vast user base to popularise its newly launched WhatsApp Pay App, the complainant alleged. As per the allegation, WhatsApp violated Section 4 of the Competition Act.
The antitrust body dismissed the complaint, saying that it did not find any contravention of the said Act.
“In view of the foregoing, the Commission is of the opinion that there exists no prima facie case of contravention and the information filed is directed to be closed under Section 26(2) of the Act,” the order said.
In its submission, WhatsApp said that WhatsApp Pay is only in the beta phase, it cannot be even said to exist as a separate product. It said that the allegation of bundling is without merit and does not satisfy the conditions of bundling as understood in the antitrust context.
“Firstly, it has been submitted that the WhatsApp application and the payments feature are not separate products, rather it is an additional feature, whose commercial launch is subject to approval by NPCI,” it said.
WhatsApp’s ‘product’ is the WhatsApp application, which has over time added a number of new features, including voice messaging, video calling, image and document sharing, among others, said the messaging platform in its submission.
It added that WhatsApp Pay is an additional feature that will become part of the WhatsApp service when the full release version of WhatsApp Pay is launched.
The CCI, however, said that the Commission does not fully agree with the submissions of WhatsApp in this regard.
“Clearly, WhatsApp Messenger and WhatsApp Pay are two distinct products with different functionalities; they are, in fact, in two separate relevant markets, as has been elucidated by the Commission supra. It has also been prima facie held above that WhatsApp is the dominant player in the relevant market, i.e., ‘market for OTT messaging apps through smartphones in India’,” said the CCI order.
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