INTERMEDIARY RULES IN INDIA SET TO CHANGE
Source: Factor Daily

INTERMEDIARY RULES IN INDIA SET TO CHANGE

In July 2018, Mr. Ravi Shankar Prasad, Minister for Electronics and IT, announced the government’s decision to strengthen the legal framework applicable to social media platforms. The idea was to make them more accountable. In pursuance of this announcement, Ministry of Electronics and Information Technology (“Meity”) has published the Draft Information Technology (Intermediary Guidelines) Rules 2018 (“Draft Rules”) and invited comments/ suggestions from the public.

Before going into some of the key amendments that have been proposed in the Draft Rules, it is important to understand the meaning of intermediaries.

What is an intermediary?

An intermediary is any person who on behalf of another person receives, stores or transmits electronic messages or provides any service with respect to such electronic messages. Example, Facebook, Whatsapp, LinkedIn, Quora, Twitter, Instagram, Hike Messenger, WeChat or any other platform that allows you to communicate or connect.

Exemptions to intermediaries

The current regulatory framework governing intermediaries exempts them from any liability arising from any third-party information made available or hosted by them. However, this exemption is only available when the intermediary’s function is limited to providing access to such information and it does not participate in the transmission of such message (think no editorial control). Also, this exemption will not be available in cases where the intermediary is found to have conspired or abetted or aided or induced in any manner the commission of any unlawful act and/or has failed to expeditiously remove or disable access to any information without vitiating evidence upon receiving actual knowledge, or being notified by the government or its agency that such information residing in the intermediaries’ system is being used to commit an unlawful act. It is also important to note that the exemption is only available when the intermediary complies with the Information Technology (Intermediary Guidelines) Rules 2011 (“Intermediary Guidelines”) issued under the Information Technology Act, 2000.

What led to the proposed amendments?

In view of certain recent events, it was observed that social media platforms are being widely used as tools to spread hatred, false news and create social disharmony. Therefore, Meity has proposed an amendment to the Intermediary Guidelines, 2011 through the Draft Rules.

Proposed amendments

The key amendments proposed in the Draft Rules are as follows:

  1. Restriction on information that threatens public health, safety, and critical information infrastructure etc.

The Draft Rules require an intermediary, to amongst other things, also inform its users not to host, display, upload, modify, publish, transmit, update or share any information that: (i) threatens public health or safety; (ii) promotes cigarettes or any other tobacco products; or (iii) promotes consumption of intoxicants including alcohol; or (iv) promotes Electronic Nicotine Delivery Systems (ENDS) and similar products that enable nicotine delivery; except for the purpose and in the manner and to the extent, as may be approved under the Drugs and Cosmetics Act, 1940 and Rules made thereunder or (v) threatens critical information infrastructure.

Source: DepositPhotos
  1. Intermediary to co-operate with government investigations

The Draft Rules also require the intermediary to comply with any lawful order, within 72 hours of its communication and provide such information or assistance as may be requested by any government agency. Any such request can be made in writing or through electronic means stating clearly the purpose of seeking such information or any such assistance. The Draft Rules require the intermediary to enable tracing of the originator of information on its platform (on instructions from an authorised government agency).

  1. Business Registration and other compliances for intermediaries with more than 50 lakh users in India

The Draft Rules also require an intermediary who has more than fifty lakh users in India or is in the list of intermediaries specifically notified by the government of India  to be a company incorporated under the Companies Act, 1956 or the Companies Act, 2013; have a permanent registered office in India with physical address; and appoint in India, a nodal person of contact available  for 24×7 coordination with law enforcement agencies and officers to ensure compliance to their orders/requisitions made in accordance with provisions of law or rules.

If the Draft Rules are to come into force, companies such as Quora and Whatsapp may need to incorporate a company in India. The Draft Rules do not provide clarity on whether an intermediary can alternatively have a branch office or liaison office. We hope that the Rules that are ultimately notified will clarify this point.

To our mind, this requirement to have a permanent establishment in India for the classified intermediaries may disrupt some of the legal and regulatory positions adopted by several offshore intermediaries and require them to comply with several local laws including the laws governing the digital communication space in India. On a related note, we believe that this kind of regulatory intervention may ultimately become the basis for a more well defined legal and regulatory framework for over the top services (OTTs) in general. We are of the view that the Draft Rules should also be developed further to address other concerns related to the OTT businesses. There is also a pending consultation process around the OTT business regulation issue which has been started by TRAI. It will be exciting to see how these two independent yet related processes will shape the future of OTT business regulation in India.

  1. Removing and Disabling Access to information

The Draft Rules also require an intermediary to immediately remove or disable access to information from its system (without vitiating evidence in any manner), where such information is found to be against the interests of the sovereignty and integrity of India, the security of the State, friendly relations with foreign States, public order, decency or morality, or in relation to contempt of court, defamation or incitement to an offence.  Such information is required to be removed no later than 24 hours from receiving a court order, or on being notified by the appropriate Government or its agency under section 79(3)(b) of IT Act.

While we understand the concerns of the Ministry, however, we would like to point out that this ground of sovereignty and integrity and security of India is more often than not misused by the officers who are given the discretion to make such decisions. For example, the default response to most RTI applications is that the information sought cannot be given because it is against the “sovereignty and integrity of India and the security of the State”. Therefore, it is important for the government to also notify guidelines that lay down the principles for judging what is and what is not against the interests of the sovereignty and integrity of India, the security of the State, friendly relations with foreign States, public order, decency or morality, and defamation. Our concern here is that concepts such as decency, morality, integrity and also sovereignty are so abstract and relative in time and space that it is not fair to expect an officer who is sitting in isolation in a government building under a hierarchical structure to make a decision on this account which will be considered as representative of the present-day reality which is evolving constantly. Hence, it is essential to lay down certain universally acceptable principles to be followed as guidelines for decision making by them. Such principles must be notified as law with illustrations and be updated regularly.

  1. Deployment of technology to remove and disable access to unlawful information

As per the Draft Rules, the intermediary will also be required to deploy technology based automated tools or appropriate mechanisms, with appropriate controls, for proactively identifying and removing or disabling public access to unlawful information or content. We see more opportunities for idea-generators in India with this proposed amendment.

People behind the blog: Pritika Kumar and Akshita Goel

In case you require clarifications, you may contact us at help@cornelliachambers.com.

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