Can India revoke Meta's safe harbour protection? Why Facebook, Instagram and WhatsApp are under scrutiny

Meta is facing one of its biggest challenges in its largest market by active monthly users after a parliamentary panel questioned the company's handling of Prime Minister Narendra Modi's Facebook post while raising the possibility of withdrawing its safe harbour protection under Indian law.

The issue assumes significance amid broader concerns over Meta's content moderation practices, including child sexual abuse material and deepfakes. While the company has apologized for removal of PM Modi's video and child abuse materials, it has reignited discussions over its liability, accountability and the legal protections available to it in the country.

An apology and a direction

Meta's Chief Global Affairs Officer Joel Kaplan apologised to the Ministry of Electronics and Information Technology (MeitY) for the temporary restriction of Prime Minister Narendra Modi's Facebook post on July 23, describing it as a "technical error", according to PTI. The company also apologised during a meeting between Meta's global team and Information Technology Minister Ashwini Vaishnaw over lapses in content moderation, including concerns related to child sexual abuse material.

Meta CEO Mark Zuckerberg also apologised to Indian government officials over child sexual abuse content and deepfakes on the company's platforms, a PTI report further mentioned.

According to sources cited by PTI, the discussions between Meta and government officials were detailed, with the company being asked to implement specific corrective measures and report back to the government on the results.

The whole controversy has raised several questions over Meta's safe harbour protection, and what would happen if the company loses it?

What is safe harbour protection?

Safe harbour protection is a legal safeguard provided to online intermediaries under Section 79 of the Information Technology Act, 2000.

It protects platforms such as Facebook, Instagram, WhatsApp, X, YouTube, Google Search, online marketplaces and payment platforms from being held automatically liable for the content their users post, but these comes with conditions including complying with the law and fulfil due diligence requirements, according to a Hindustan Times report.

Simply put, the provision shields intermediaries such as Meta-owned Facebook from legal liability for content uploaded by users, as long as they fulfil the legal due diligence requirements. However, the immunity is conditional.

Under Section 79(2), platforms are expected to remain neutral. They cannot initiate the transmission of information, select the receiver of a particular message or materially modify the information transmitted. They must also comply with obligations under the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules.

The parliamentary panel's concerns stem from whether Meta's actions in restricting the Prime Minister's post are consistent with those neutrality requirements.

What happens if Meta loses safe harbour protection?

Without the legal shield provided under Section 79, the company could face civil and criminal cases for user-generated content across its platforms.

According to legal experts, such scenarios would alter the liability framework under which social media companies operate in India.

Can Meta's safe harbour protection be revoked?

Despite the parliamentary panel's recommendation, legal experts say withdrawing Meta's safe harbour protection can not be done overnight.

According to an expert cited by a CNBC report, the present legal framework treats the loss of intermediary immunity as content-specific, rather than platform-wide while adding that the safe harbour protection can be lost if an intermediary abets unlawful activity, fails to remove illegal content after receiving a valid government or court order, or does not meet its due diligence obligations under Indian law.

However, he added that the current legal framework does not provide for blanket withdrawal of safe harbour protection for an entire platform.

Another expert told CNBC that safe harbour remains "the cornerstone of digital regulation" and any move to withdraw it would likely require changes to the country's legal framework.

The experts further mentioned that the Parliamentary Standing Committee itself cannot revoke safe harbour protection but can only recommend the government to examine the issue. Further action can only be taken by following the legal process under the Information Technology Act.

Why India matters to Meta

India is Meta's largest market by users. It is the world's biggest user base for WhatsApp and one of Meta's largest audiences for Facebook and Instagram, while also being among the company's fastest-growing advertising markets, according to multiple reports.

Meta's social media platforms have the highest number of monthly active users in India than anywhere else in the world.

The Meta team is likely to remain in India for a few more days, with three to four additional meetings expected to be held, news agency ANI reported.

The Meta team was scheduled to meet MeitY officials today for a third time. Another meeting will likely take place next week.