After Google, Whatsapp’s 19 billion acquisition might come under India’s CCI probe

The much talked about Facebook-Whatsapp’s deal might come under the scrutiny of India’s fair trade regulator Competition Commission of India (CCI), which has Ashok Chawla as the chairperson. According to IBN, since both the companies have a great number of users in India, the probability of this happening is high.

All merger and acquisition deals, involving companies having presence in India, have to get approval from the CCI which has the mandate to keep a tab on unfair trade practices at the market place. Whatsapp has over 40 million users in India, whereas Facebook has over 92 million.

A senior official said the Commission is yet to receive an application seeking approval for the deal, but it would indeed face an elaborate scrutiny.

Google which is facing an anti-trust scrutiny by CCI since the last two years, might have to pay a penalty of upto USD 5 billion, according to ET. “We’re pleased that the conclusion of the Federal Trade Commission’s two year review was that Google’s services are good for users and good for competition,” a Google spokesperson said in an e-mailed statement.

Last month, Facebook had shaken hands with Whatsapp to acquire the latter for USD 16 billion, including USD 4 billion in cash and approximately USD 12 billion worth of Facebook shares. Whatsapp’s entire team of 50 members will be joining Facebook and an additional USD 3 billion in restricted stock units to be granted to them, thereby making the entire deal to be worth a whopping USD 19 billion.

It is interesting to see that although the Government is unclear about its policies on different elements of the digital sector, such as Bitcoin, eCommerce etc., it’s not shying away from penalising international companies.

Feature image courtesy – Investment Property Central

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