Meta Assails CCPA Penalty in Delhi High Court Over Walkie-Talkie Listings
Meta Platforms faced off against the Central Consumer Protection Authority (CCPA) in the Delhi High Court on Wednesday, March 18, challenging a Rs 10 lakh penalty imposed for the alleged unauthorised sale and listing of walkie-talkies on Facebook Marketplace. Represented by Senior Advocates Mukul Rohatgi and Arvind Datar, Meta argued that the CCPA overstepped its jurisdiction by treating the platform as an e-commerce entity subject to specific regulatory frameworks.
Meta's Defense: Facebook Marketplace as a Digital Notice Board
In court, Rohatgi emphasized that Facebook Marketplace fundamentally differs from traditional e-commerce platforms like Amazon and Flipkart. He described it as a digital notice board where users independently connect for transactions, without Meta facilitating sales or charging fees. "We are not providing a virtual Khan Market. This is a notice board meant only for Facebook users. We are not a shop. No commercial sales are allowed. No consideration is charged. We don't charge anybody," Rohatgi stated.
He further explained that the platform merely allows listings, such as for selling a phone, but does not provide mechanisms for purchase or commission. "It is a facility of a digital notice board meant for sale... Mr Rohatgi has a phone to sell; someone wants to buy. The platform doesn't charge anything or provide any mechanism to buy or sell. Mr Rohatgi will have to contact him," the counsel added, underscoring the passive role of Meta in user interactions.
Legal Arguments and Jurisdictional Disputes
Meta's petition, as reported by PTI, contends that the CCPA acted beyond its authority by incorrectly applying e-commerce rules to Facebook Marketplace. The company claims the order was based on an "untenable" premise and violated principles of natural justice. The petition argues that extending e-commerce regulations to such platforms would impose undue burdens on individual sellers.
"To circumvent the plain language of the E-Commerce Rules and clear statutory frameworks, the Authority adopts a strained interpretation under which any digital platform that hosts repeated listings of regulated goods is brought within the E-Commerce Rules. This approach renders the exclusion illusory and would extend the Rules to virtually every digital platform, including online newspapers and community forums," the petition stated.
It further warned that this could impact natural persons selling everyday items, creating regulatory inconsistencies. Meta also alleged that the CCPA improperly ruled on intermediary guidelines, which fall under the Ministry of Electronics and Information Technology's purview.
CCPA's Order and Broader Crackdown
In its January 1 order, the CCPA directed Meta to ensure compliance with laws for products like walkie-talkies that require statutory approval. The authority mandated periodic self-audits to check deceptive listings and public disclosure of audit certificates. This action was part of a larger initiative, with the CCPA taking suo motu cognisance of illegal sales on multiple e-commerce platforms and imposing penalties accordingly.
Court Proceedings and Future Hearing
During the hearing, Justice Purushaindra Kumar Kaurav questioned Meta on why the National Consumer Disputes Redressal Commission could not address the issue. He listed the petition for further hearing on March 25, asking Meta to justify its claim that the CCPA order was "without jurisdiction." The judge's inquiries highlight the ongoing legal scrutiny over platform responsibilities in digital marketplaces.
This case underscores the evolving regulatory landscape for online platforms in India, as authorities seek to enforce consumer protection laws while companies defend their operational models. The outcome could set precedents for how digital notice boards are classified under e-commerce regulations.
