Facebook Unit WhatsApp Sues Indian Government Over New Privacy Rules In Unusual Move

Facebook Inc.’s FB WhatsApp messaging service has filed a lawsuit against the Indian government seeking to block new rules for social media companies that take effect on Wednesday, the Indian Express reported.

What Happened: WhatsApp filed the legal complaint on Tuesday in the Delhi High Court, according to the report. The complaint challenges one of the new rules that requires social media companies to make provisions for the identification of the “first originator of information.”

WhatsApp has contended that the traceability provision is a violation of people’s fundamental right to privacy and will break end-to-end encryption, which tries to prevent others from finding out who send a message.

WhatsApp, which has 400 million users in India, also said on its webpage that it opposes traceability, which effectively mandates “a new form of mass surveillance.”

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Why It Matters: WhatsApp’s move to file a legal complaint comes just a day after the company said that it aimed to comply with the provisions of the new rules and was in talks with the Indian government on a few issues.

The new rules, announced by the government in February, require social media platforms such as Facebook, Instagram and Twitter Inc. TWTR to remove offending content within 36 hours of a legal order and establish a grievance redressal mechanism. Failure to comply with the new guidelines will result in the social media platforms losing intermediary status.

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However, WhatsApp has gone ahead with implementing its controversial new privacy policy since May 15. The new policy was earlier met with widespread criticism and had led to millions of users of users fleeing the platform.

Price Action: Facebook shares closed almost 1% higher in Tuesday’s trading at $327.79.

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