WhatsApp quizzed over consumer protection concerns in EU

Remember the backlash over that impossible-to-understand privacy policy update pushed out by WhatsApp last year? A consumer protection complaint over the messaging platform’s aggressive push to make users accept impenetrable terms changes related to its use of their data continues to rumble on in the European Union — now shifting up a gear into a formal investigation.

The European Commission said today that it’s written to WhatsApp asking it to clarify the changes and explain how — or, well, whether — they comply with the bloc’s consumer protection law.

It added that WhatsApp must better inform consumers about its use of their data.

A complaint against WhatsApp’s updated T&Cs was filed by a number of EU-based consumer protection organizations back in July. It called out how aggressively the Facebook/Meta-owned messaging giant has been pushing the opaque terms on users, via “persistent, recurrent and intrusive notifications”, and (at least initially) giving people little time to consider what the changes might mean and whether they wanted to agree to them.

The user backlash over the WhatsApp “privacy policy” update got so fierce that rival messaging apps — such as the privacy-focused Signal Messenger — saw a huge spike in sign-ups a year ago as concerned WhatsApp users sought alternatives with a better reputation for respecting people’s information.

The EU consumer groups’ complaint about the WhatsApp policy update — which was lodged with the European Commission and the regional network of national consumer authorities — argued the company’s actions breached the EU Directive on Unfair Commercial Practices.

The Commission and the European network of national consumer authorities (CPC) — led by the Swedish Consumer Agency — appear to have arrived at similar conclusions, writing that they are now opening an “official dialogue” with WhatsApp over its compliance with EU consumer protection law and giving the platform until February 28 to respond to “our concerns”.

Specific concerns are whether “sufficiently clear information is given to consumers on the consequences of their decision to accept or decline the company’s new terms of service; the fairness of WhatsApp’s in-app notifications prompting consumers to accept the new terms and privacy policy; and whether consumers have an adequate opportunity to become acquainted with the new terms before accepting them”.

The EU’s executive and consumer authorities are also concerned about the exchange of users’ personal data between WhatsApp and third parties or other Facebook/Meta companies — an area of long running concern and complaint in Europe, following a controversial 2016 Facebook reversal of WhatsApp’s no data-sharing-with-Facebook policy. (For which the tech giant was later fined $122M under EU M&A rules since, pre-merger, Facebook had told regulators it could not automatically match user accounts between its own platform and WhatsApp.)

In a statement, EU commissioner for justice, Didier Reynders, said: “WhatsApp must ensure that users understand what they agree to and how their personal data is used, in particular where it is shared with business partners. I expect from WhatsApp to fully comply with EU rules that protect consumers and their privacy. This is why we launched the official dialogue today. WhatsApp has until the end of February to come back to us with concrete commitments on how they will address our concerns.”

The European consumer organization, BEUC, welcomed the Commission-CPC investigation of WhatsApp’s practices.

In a statement, BEUC’s deputy director general, Ursula Pachl, added: “WhatsApp bombarded users for months with persistent pop-up messages. What’s more, consumers didn’t know what they were being pushed to accept. WhatsApp has been deliberately vague about this, laying the ground for far-reaching data processing without valid consent from consumers. We welcome the CPC-Network’s decision to investigate WhatsApp. We expect WhatsApp to clarify and amend its policies in full respect of consumers’ rights, including for those consumers who agreed to the new terms due to the company’s unfair practices.”

WhatsApp was also contacted for a response to the development — and a spokesperson sent us this line:

“We look forward to explaining to the European Commission how we protect our users’ privacy in compliance with our obligations under EU law.”

WhatsApp’s spokesperson also pointed to a November 2021 update it made to its European Region privacy policy — when it said it was adding “additional detail around our existing practices” — a change that came hard on the heels of a $267M fine for transparency breaches of EU data protection law.

It’s not clear if WhatsApp has entirely abandoned its earlier attempt to force through the update in Europe. Like pretty much everything around this confusing saga there’s precious little clarity on offer from WhatsApp.

Anecdotally, the messaging app does seem to have stopped the nagging pop-ups it had been periodically sending out — pushing users to ‘accept’ the updated policy.

Asked about this WhatsApp’s spokesperson told us: “In the EU users don’t accept the privacy policy – it’s a transparency notice”.

Pushed for more clarity, this person told us: “We are no longer showing in-app notifications related to the January 2021 Privacy Policy and Terms of Service update to avoid user confusion with the November privacy policy.

“For the very small number of users still to accept the terms of service, there will be other opportunities to accept, for example when they re-register or where they want to use a feature that’s related to the Terms of Service update for the first time.”

So, basically, it’s stopped pushing users to accept its terms until it can come up with a new way to make them accept the terms?

The spokesman went on to claim EU users never actually needed to accept the January 2021 terms — which is funny, considering how often it nagged people in the EU to do exactly that! — saying that “as a transparency document, in the EU it does not need to be accepted by users, and no action is required to continue using WhatsApp”, adding that: “It is provided so users are informed about how WhatsApp works”.

Displaying a transparency notice vs asking users to ‘accept’ updated T&Cs evidently has some legal nuance vis-a-vis EU law. Even if the upshot of how WhatsApp operated is that most users probably inadvertently ‘agreed’ to whatever it wanted anyway.

Add to that, if WhatsApp’s goal was actually to ensure users are informed about how WhatsApp works it seems to have done an exceptionally poor job of that.

BEUC was also unsure when we asked if it had noticed any changes to WhatsApp’s practices around the policy update after it filed its complaint. A spokesman told us: “Our role was to raise the alarm based on what we’d witnessed. We now trust the Commission and consumer protection authorities to help shed full light on the practices.”

Update: WhatsApp’s spokesperson has been back in touch — to “clarify” another point: The company says EU users did in fact need to accept the terms of service but the (regional) privacy policy is a “transparency document” that does not need to be accepted.

It’s still not clear whether WhatsApp continues to actively nag EU users who still have not accepted the ToS to do so.

Consumer protection vs privacy

While WhatsApp has faced one major transparency penalty in the EU, privacy complaints about its parent Facebook/Meta’s data terms have been stacking up undecided for years — despite a major update to the bloc’s framework in 2018, as the General Data Protection Regulation (GDPR) came into application.

Privacy campaigners had expected the GDPR to put major limits on tracking-based business models. Instead, data protection regulators have been cripplingly reluctant to enforce clear legal standards against systematic breaches by the adtech industry.

However it’s notable that — also today, ahead of an annual day celebration of regional privacy rights tomorrow — the European Commission has issued another high level call for data protection enforcement to ramp up, with Reynders and Věra Jourová, the commissioner for values and transparency, writing in a joint statement [emphasis ours]:

“With the General Data Protection Regulation now well established in our Union, full implementation and enforcement of data protection rules remain a priority for the Commission. Robust enforcement by data protection authorities, cooperating in a truly European way in the European Data Protection Board (EDPB), is key for the success of the GDPR. The year 2021 has seen a ramping up of enforcement actions, with several high-profile cases resulting in significant fines. It is important that this approach is pursued and amplified in the coming months and years.”

Last month the Commission also warned DPAs of the need for GDPR enforcement to deliver against adtech giants like Facebook and Google, which remain key targets for privacy complaints — with Jourová stipulating that GDPR enforcement must become “effective” — or else she said it “will have to change”, with the further threat that any “potential changes” will move toward centralized enforcement (i.e. by the Commission itself).

The problem with GDPR enforcement against the most powerful tech platforms is that a “one-stop-shop” mechanism in the Regulation — intended to simplify compliance for companies offering cross border services by funnelling complaints through a lead data protection authority — has led to forum shopping and regulatory capture.

This has meant that complaints against tech giants are often either ignored or dropped or investigated at such a glacial pace that the companies have plenty of time to reconfigure ops and route around any risk/damage to data streams.

Ireland’s Data Protection Commission (DPC), for example, still hasn’t issued a decision on a 2018 complaint against so-called “forced consent” by Facebook and WhatsApp — two services that continue to deny users a free choice over whether their information is processed for behavioral ad targeting; a ‘zero privacy’ condition is made a requirement for accessing the service.

Yet, in the EU and under GDPR, users should be given a free choice if consent is the legal basis for the processing.

But there’s another twist to this saga. In October — after European privacy advocacy not-for-profit noyb published a draft DPC decision in relation to a GDPR complaint over the legality of Facebook’s T&Cs — the Irish regulator can be seen writing that, essentially, it can’t see any problem with a Meta wheeze in which it claims users are actually in a contract with Facebook to receive ads, ergo it can simply bypass any legal requirement to obtain their consent to track and profile them for ad targeting.

So, apparently, the actual service Facebook provides is not connecting you to your friends; it’s connecting your eyeballs to ‘relevant’ ads — or, well, that’s what it’s lawyers are arguing in the EU.

Strangely enough, Meta’s lead EU data supervisor seems okay with that. At least judging by the contents of the draft decision. (noyb has since filed a criminal corruption complaint against the DPC — accusing the regulator of “procedural blackmail”, related to an attempt to gag it from publishing any further awkward document-based regulatory revelations.)

All of which is to say that the long delay in any EU data protection enforcement against adtech has given rights-trampling giants like Meta ample room to cynically reconfigure their compliance claims — shifting from faux consent to bogus ad contract — without having to make any changes to how they actually grab people’s data.

Whether EU consumer protection law will prove a more alacritous and effective enforcement tool against adtech giants’ market might remains to be seen.

As for the sticky issue of adtech T&Cs vs EU privacy rights, we’re still waiting for DPA hammers to fall.