The Chilean Case Against WhatsApp

Introduction

In September 2025, and after the national holidays, the Chilean competition authority (Fiscalía Nacional Económica, hereafter referred to as “FNE”) announced the dismissal of a complaint against WhatsApp concerning the alleged downgrade of its privacy policies (WhatsApp, 2025).

This case is exceptional for its circumstances. First, it is one of the major movements by the Chilean competition authority against Big Tech, after a lawsuit filed against Google and a current investigation against Apple for abuse of dominant position on their app stores. Second, it followed the emerging path from other Latin-American jurisdictions regarding the relationship between data and competition law, such as Argentina (see here for an overview). Third, it is quite clear that the case resembles the German case against Facebook, in terms that a degradation of privacy policies can constitute an exploitative abuse of dominant position. Finally, although the FNE dismissed the complaint, it set out a preliminary approach of a novel test for the assessment of conducts related to data collection.

The Facts of the Case

The complaint before the FNE argued that, after a 2021 update to WhatsApp, the instant messaging app would be able to collect data and transfer it to other Meta’s apps, such as Facebook, Messenger, and Instagram, without requiring users’ consent. In this regard, the FNE only reviewed the privacy policies in WhatsApp, without investigating “the policies related to the use of data collected and processed by the Meta group, in the context of other apps other than WhatsApp, which could affect the competitive dynamics of different markets than those analysed in the investigation.”

In general, the FNE held that WhatsApp was dominant in the instant messaging market, due to its high market share and the existence of entry barriers. However, despite the major changes to the privacy policies in 2021, it “would not have implied an increase in users’ extracted data nor in WhatsApp’s ability to share that information with Meta,” as WhatsApp messages are encrypted using Signal Technology, so that neither WhatsApp nor Meta would be able to access users’ messages. Therefore, as there would be no further data for the platform to collect, there would also be no deterioration in privacy policies. Due to this reason, the FNE dismissed the complaint and closed the investigation.

A Statement on the Relationship between Data and Competition Law

In this context, the Chilean competition authority made a critical statement regarding the relationship between data protection and competition law, by claiming that in some specific cases, the collection of data without users’ consent can constitute an abuse of dominant position.

In general, the FNE acknowledged that while data collection by platforms is not per se unlawful, it can be a source of market power. On the one hand, data collection would be necessary to monetise the platform, so that a data-driven app could be offered free of charge to users. On the other hand, dominant data-based platforms “could have incentives to engage in abusive behaviour based on the collection of users’ personal data, the volume or nature of which could eventually be considered excessive for the purposes of operating the services offered.” This situation would be affected by the presence of direct network effects in data-driven platforms.

This assertion presupposed different assumptions accepted by the competition authority. First, data has an economic value. There has been a long-standing debate over whether data constitutes a non-rival product (meaning that its use by one platform does not prevent the use by another platform) or a relevant competitive variable (so that the degradation of privacy policies can affect the quality of the services offered in the market). The FNE opted for the latter approach by claiming that direct network effects would increase consumers’ switching costs, as they would have no incentive to switch to a different platform if the dominant platform already has a large user base.

Second, only platforms that are actively involved in collecting data for monetisation purposes can be involved in these cases. This approach follows previous case law: in an earlier merger case (Uber/Cornershop, 2021), the FNE analysed the combination of data from two platforms and the subsequent adoption of a joint privacy policy, viewing this as an exploitive conglomerate effect. In that case, the Chilean competition authority held that the incentives to collect data would depend on the type of platform. In a delivery app, for example, data would only improve service quality, whereas in the case of a social network or messaging app, it would constitute a key input.

Thirdly, the scale of data necessary for the efficient monetisation of the platform would be difficult for other competitors to replicate due to the presence of strong indirect network effects.

In other words, and according to the FNE, data would constitute a source of market power for specific platforms, where competitors could not replicate the data.

A Test for Assessing Excessive Data Collection

Later, the FNE specified the requirements that any data collection abuse should meet to be sanctioned. These are: “(i) the existence of a dominant position in the affected relevant market, (ii) the presence of a provision in the privacy policies that conditions access to the platform’s services on the excessive collection and processing of data; and (iii) a degradation in user privacy standards.” In concrete terms, this form of abuse would consist of the “imposition of unfair contract terms through the excessive recollection of data from WhatsApp users as a condition for accessing the free OTT instant messaging service.” Regarding anticompetitive effects, these would imply a major collection of data by the platform, the loss of control of users’ data, among others.

As seen, and according to the FNE, there would be a continuum between excessiveness and the imposition of unfair trading conditions. In this regard, some scholars argue that the incentives for a dominant platform to collect “excessive” data are similar to those in the case of excessive pricing. In Chile, while the local debate regarding excessiveness and exploitative abuses has been ongoing for years, the Chilean Competition Court recently ruled that excessive pricing can constitute an anticompetitive conduct, provided certain specific requirements are met (such as supra-dominance, the existence of impenetrable and non-transitory entry barriers, and the comparation of the excessive price using different benchmarks) (WOM, 2021). Conversely, the imposition of unfair trading terms has also been considered as an exploitative abuse, also in specific circumstances, such as cases of asymmetric “abusive compensations” for the provision of monopolistic services (EFE, 2008). In any case, these two figures are considered as two different conducts, sanctioned as separate abuses of dominant position.

Nevertheless, some scholars recognise that assessing data recollection as a case of excessive pricing can be difficult due to the normative requirements of the latter, such as the benchmark or the counterfactual of what data should legitimately be recollected in competitive conditions. In this case, although the FNE assessed that the “major amount” of data that a dominant platform can collect and the loss of control of data by users can constitute an anticompetitive effect derived from the excessive collection of data or the imposition of unfair trading conditions, there was no development of the benchmark to assess excessiveness nor the asymmetry conditions between platforms and users that would imply a situation of unfair contract terms. This omission can be explained by the limited scope of the investigation and the assessment of the absence of effects derived from the 2021 update.

Therefore, even though the FNE developed a test for enforcing data collection as an abuse of dominant position, the question of whether these conducts can constitute an exploitative conduct based on excessiveness or unfair trading conditions (and the fulfilment of the requirements of each conduct) remains open and unclear.

Conclusions

In sum, while the Chilean case against WhatsApp constitutes the most significant statement on the relationship between data and competition law to date, the approach adopted by the competition authority raises questions about the interpretation and scope of the test determined to assess this type of conduct. In any case, it is quite clear that this approach implies that the excessive or unfair collection of data can effectively constitute an exploitative abuse of dominant position. Therefore, it is expected that future cases will focus directly on the analysis of the excessiveness or the unfairness of data collection, rather than addressing the preliminary question of the relationship between data collection and competition law.

Disclaimer: The author’s firm advised a competitor of WhatsApp in requirements of information by the Chilean competition authority during the respective investigation.