Supreme Court Issues Notice On Plea For Ensuring Compliance of 'WhatsApp Pay' With Privacy Guidelines

Supreme Court Issues Notice On Plea For Ensuring Compliance of 'WhatsApp Pay' With Privacy Guidelines

The Supreme Court of India (SC) issued a notice in an Impleadment Application (IA), that raised a plea regarding data protection on Unified Payments Interface (UPI) platforms, stating that WhatsApp Pay is about to launch full-scale operations in India despite the instant petition being pending before the Top Court

A Bench of the SC headed by CJI SA Bobde heard the submissions of Senior Advocate Vikas Singh, who appeared on behalf of Yedhu Krishna Menon (Applicant) and proceeded to issue a notice in the IA.

The IA, filed by the applicant who claimed to be a tech expert, through Advocate-on-Record (AOR) Deepak Prakash, submitted before the SC that in the plea the directions were sought to Reserve Bank of India (RBI) and National Payments Corporation of India (NPCI)for ensuring that, "WhatsApp is not permitted to launch full-scale operations of 'WhatsApp Pay' in India, without fulfilling all legal compliances to the satisfaction of this Hon'ble Court regarding the requisite regulatory compliances".

It was further mentioned in the IA that the Applicant got information through various media reports that WhatsApp Pay is about to launch its' full-scale operations in India. It was alleged that WhatsApp Pay has obtained permission from RBI and NPCI, although the instant applicant is pending before the SC

It was further submitted that how can the App be launched without satisfying the Court regarding requisite regulatory compliance. The IA contended that "Pertinently, some of the prominent issues, with respect to the launch of full-scale operations of WhatsApp Pay in India vis-à-vis non-compliance of rules and regulations and violation of fundamental rights guaranteed under the Constitution of India still remain unaddressed and the same have not been raised".

The Applicant requested the Court for impleadment in the petition showing concern that it is a matter of national security, sovereignty, and integrity, along with issues relating to data privacy and security of Indian citizens.

The Top Court issued a notice on 15 October 2020, in the main petition filed by CPI Rajya Sabha MP Binoy Viswam, wherein it sought "the protection of the fundamental right to privacy of millions of Indian citizens who are using Unified Payments Interface (UPI)".

The UPI system in India is regulated and supervised by RBI and NCPI, the plea contends that these regulatory bodies have failed to fulfill their statutory obligations of protecting and securing the sensitive data of users, and hence comprising their interest by allowing non-compliant foreign entities to operate its payment services.

The plea also highlighted that RBI and NPCI "Have permitted the three members of 'Big Four Tech Giants' i.e. Amazon, Google and Facebook/WhatsApp (Beta phase) to participate in the UPI ecosystem without much scrutiny and inspite of blatant violations of UPI guidelines and RBI Regulations".

It was contended that the conduct of RBI and NCPI, has invariably put the sensitive financial data of Indian customers at huge risk, wherein the above-mentioned 'Big Four Tech Giants' have been "continuously accused of abusing dominance, and compromising data, among other things".

The CEOs of these entities had been directed to testify in a hearing before the Judiciary Committee of US Congress. In a Counter-Affidavit filed recently by the RBI, it has been submitted that the responsibility to ensure that companies like Amazon, Google, and WhatsApp operate in compliance with laws governing Unified Payments Interface (UPI) lies with NPCI, and not RBI.

The SC has posted the matter on 1 February 2021 for further hearing.