In February 2020 the Hungarian Competition Authority initiated a competition supervisory procedure against Viber Media (operator of the Viber app, seated in Luxembourg) which was likely to infringe the prohibition of unfair commercial practice against consumers. During the procedure, Viber made commitments aiming at the avoidance of penalties. The procedure ended on 16 May 2024 with a decision where the authority, without finding an infringement or lack of infringement, obliged Viber to fulfil its commitments.
The reason for the Hungarian Competition Authority’s investigation firstly was that the tech company stated about its product that it is free, e.g. by advertising the Viber app with the ‘Free and secure calls and messages’ slogan, which could be misleading for consumers, as far as they had to transfer their personal data as consideration for the ‘free’ use of the Viber app, and, according to the Hungarian Competition Authority, that transfer of personal data is likely to be a kind of compensation. Secondly, by stating that its app is ‘secure’, Viber could also mislead consumers, because it is likely that not every message on Viber was encrypted. Thirdly, Viber failed to make available a notice in Hungarian about the app’s most important conditions of use for Hungarian customers, which could also be classified as unfair commercial practice.
Therefore, in order to comply with the applicable EU and national competition and consumer protection laws and to avoid competition fines, Viber made the following commitments: preparation and continuous updating of privacy notices and in-app information in Hungarian; providing additional information on data management before the registration begins; making available the ad-free Viber Plus for Hungarian users (Viber Plus users’ personal data is not used for advertising and they do not receive any more ads as long as their Viber Plus subscription is active); increasing the role of consumer consent in case of the non-paid basic Viber in order to reduce the amount of personal data that can be used by the company by default; improving consumer information on privacy and security issues; and last but not least, developing and operating - at least for two years - a privacy bot in Hungarian to inform users about online privacy and security.
According to the Hungarian Competition Act, if an undertaking fails to fulfil such commitments, the Hungarian Competition Authority can observe the non-performance of those commitments and therefore impose a fine. These consequences of non-performance and the fact that in the last few years, the Hungarian Competition Authority has imposed serious competition remedies or fines on several global tech companies (e.g. Google, PayPal, Apple or Booking.com) are likely to encourage Viber to satisfy the obligations listed above.
By Rita Parkanyi, Partner, KCG Partner
