WhatsApp Pay accused of foul play; CCI reviewing antitrust allegations

Mary P. Humphrey

The Competitiveness Commission of India (CCI) is on the lookout into allegations that Facebook-owned WhatsApp is abusing its dominant situation by providing payment services to its huge foundation of messaging app end users in the state. The case is primarily based on a grievance filed in mid-March that alleged WhatsApp […]

The Competitiveness Commission of India (CCI) is on the lookout into allegations that Facebook-owned WhatsApp is abusing its dominant situation by providing payment services to its huge foundation of messaging app end users in the state. The case is primarily based on a grievance filed in mid-March that alleged WhatsApp was bundling its electronic payment facility in its messaging app to abuse its market place situation and penetrate India’s booming electronic payments market place, in accordance to a Reuters report.

WhatsApp and Facebook did not instantly reply to Reuters‘ repeated requests for remark. The CCI also did not reply.

In accordance to the report, the complainant in the case is a lawyer whose identity has not still been divulged. The grievance, which has formerly not been described, will come at a significant time for WhatsApp, which is aggressively functioning to totally start its payments system in India, exactly where it has been beta testing it with 1 million end users due to the fact 2018.

Deficiency of regulatory clearances have intended WhatsApp has struggled to offer the service to its around four hundred million end users in India, its greatest market place globally.

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The CCI can order its investigations arm to conduct a wider probe into the allegations, or throw out the case if it finds no merit in it. “The case is in initial phases .. senior customers of CCI are reviewing it but a ultimate determination has not been reached,” claimed the 1st of the three resources, all of whom declined to be identified as the case specifics were non-public.

The antitrust grievance alleges that WhatsApp’s substantial person foundation intended it was dominant in the messaging app market place, and the firm was forcing its payments aspect on to its present end users.

The two solutions – WhatsApp’s messenger service and its payments aspect – are bundled, which could harm level of competition and violate the country’s antitrust legal guidelines, the 2nd resource claimed though detailing the allegations.

WhatsApp’s payment service will make it possible for end users to do inter-lender fund transfers from in the messaging app. It will compete with payment apps of Alphabet Inc’s Google and Softbank-backed Paytm, which already have tens of tens of millions of end users throughout India.

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Although the antitrust case has been filed versus each Facebook and WhatsApp, the complainant has urged the watchdog to look into only WhatsApp, the 2nd resource claimed.

It was feasible WhatsApp could escape a wider investigation as the extent of any market place abuse will be clearer only when it totally launches the service, the resource additional.

The antitrust grievance is the most current setback for WhatsApp in India.

An Indian legal think-tank previous thirty day period filed a case in the Supreme Court docket stating WhatsApp should really not be authorized to grow its payments service as it was violating knowledge storage principles.

WhatsApp informed the courtroom it will comply with needed legal guidelines before it moves ahead, in accordance to a Could 13 courtroom order that also asked Indian regulators to submit its sights on the case.

In April, Facebook claimed it will spend $5.seven billion to buy a nine.ninety nine% stake in India’s Reliance Industries’ electronic arm, as it appears to roll out services for grocers and tiny organizations by capitalizing on WhatsApp’s comprehensive attain.

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