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Facebook-RIL deal: CCI raises concerns over data-sharing pact; FB assures it's 'limited'

CCI had expressed concerns over Jio Platforms subsidiary Jio Infocomm's cloud and Facebook's dominance in online ad space. It said data processed by both companies was complementary to each other

twitter-logoBusinessToday.In | October 7, 2020 | Updated 10:25 IST
Facebook-RIL deal: CCI raises concerns over data-sharing pact; FB assures it's 'limited'
CCI approved acquisition of 9.99% in JPL by Facebook entity Jaadhu in June

The Competition Commission of India (CCI) had raised several questions over the Jio Platforms-Facebook deal, saying the user data processed by companies was complementary to each other and could result in 'anti-competitive' conduct.

Mark Zuckerberg-led Facebook, however, assured the deal with Mukesh Ambani's Reliance Industries Jio Platforms was restricted to sharing of "limited exchange" of data. It said that as per the initial agreement, neither Jio Platforms nor Facebook India will acquire each other's data and that it's restricted to only facilitation of "e-commerce transactions" on JioMart, a subsidiary of Jio Platforms Ltd.

The CCI had given its nod to the acquisition of 9.99 per cent stake in JPL by Facebook-owned Indian entity Jaadhu Holdings for Rs 43,574 crore in June. However, before approving the deal, the commission raised doubts over the data sharing prospects between RIL and Facebook.

Also read: Facebook-Jio deal: FB investment values Jio Platforms at record Rs 4.6 lakh crore; 5th largest in m-cap

"Its use is limited, proportionate and solely for the purpose of implementing the Proposed Commercial Arrangement," reported The Economic Times quoting Jaadhu's response. The company said the Master Services Agreement signed between RIL and Facebook does not allow them to share critical and confidential data for their benefit or for further dissemination of data to third parties. In its explanation to CCI, Jaadhu has said the data shared with Jio Platforms is neither "exclusionary nor rare", and that all the norms will be followed while sharing and processing of the data.

Also read: Mukesh Ambani's Reliance Industries signed 18 deals worth Rs 1.9 lakh cr since COVID-19 outbreak in India

The CCI had expressed concerns over Jio Platforms subsidiary Jio Infocomm's cloud over Indian telecom users being the biggest telco in terms of market share, and Facebook's dominance in the online ad space. It said the data processed by both the companies was complementary to each other. It warned that any "anti-competitive conduct with regard to data sharing on their part could be taken up by the CCI.

Also read: Mukesh Ambani on shopping binge; Reliance buys into 23 firms in 3 years

The investment worth Rs 43,574 crore by Facebook for 9.99 per cent stake in Jio Platforms was the first in a series of 11 deals secured by Reliance Industries' digital arm. The social media giant had executed this deal via its subsidiary Jaadhu Holdings. Announced on April 22, the deal makes Mark Zuckerberg's Facebook the largest minority shareholder in Reliance Industries.

In total, Reliance Industries committed Rs 1,52,056 crore for a combined stake sale of 33 per cent in JPL, with the last investment worth Rs 33,737 crore from Google in July.

Also read: Facebook-Jio deal: Inside Reliance's Rs 1.53 lakh crore debt resolution plan

Also read: Facebook buys 10% stake in Reliance Jio: Here's what Mark Zuckerberg, Mukesh Ambani have to say

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