Welcome to our fortnightly newsletter, where our reporters Kruttika Lokesh and Dhananjay Dhonchak put together handpicked stories from the world of tech law! You can find other issues here.
Union Consumer Affairs Minster issues E-Commerce Rules to shift the focus onto consumer protection
In an increasingly globalised world, major retail companies like Amazon have reached even the most inaccessible places. The consumers that are exposed to e-commerce companies can only be protected in the presence of increased accountability. The newly issued E-Commerce Rules set up a Central Consumer Protection Authority to police companies that violate consumer rights. Misleading ads and unfair trade practices are prevented as e-retailers have to mandatorily disclose return, refund, warranty, exchange, guarantee, delivery and grievance redressal details. Henceforth, prices of products cannot be manipulated to produce unreasonable profits for companies. These rules apply to retailers either registered in India or abroad.
- Aparajita Saxena, “New ecommerce rules direct Amazon, Flipkart, others to provide more information on products, sellers”, YourStory (25th July 2020).
- Alnoor Peermohamed and Aditi Shrivastava, “E-commerce companies seek time to comply with labelling rule”, Economic Times Tech (25th July 2020).
- Laghavi Pahwa, “Consumer Protection (E-commerce) Rules 2020: A Step In The Right Direction?”, LiveLaw (1 August 2020).
- Lauren Feiner and Annie Palmer, “Trump administration cracks down on counterfeits sold on Amazon and other online retailers”, CNBC (27 January 2020).
- Press Release, “Social media companies need to do more to fully comply with EU consumer rules”, European Commission (15 February 2018).
Congress questions Big Tech in major antitrust hearing
Jeff Bezos of Amazon, Tim Cook of Apple, Mark Zuckerberg of Facebook and Sundar Pichai of Google answered questioners by videoconference as members of Congress quizzed the titans of Big Tech on topics ranging from abuse of dominance consumer rights. Several pertinent questions were asked of the executives, with Democratic members focusing on the antitrust aspects and Republicans raising concerns of bias and censorship on social media platforms. While no solutions were expected to be reached, the hearings showed the spotlight that Big Tech is increasingly being subjected to, as questions continue to be asked over how much control they should be allowed given social media’s pivotal role in modern life.
- Roger McNamee, “A historic antitrust hearing in Congress has put big tech on notice”, The Guardian (31 July 2020).
- Gilad Edelman, “The Big Tech Hearing Proved Congress Isn’t Messing Around”, Wired (29 July 2020).
- Staff, “Lawmakers From Both Sides Take Aim at Big Tech Executives”, New York Times (29 July 2020).
130 high profile Twitter accounts hacked in massive cryptocurrency scam
On July 15th, Twitter was hit with a widespread attack wherein the verified accounts of nearly 130 celebrities, politicians, billionaires including Bill Gates, Kanye West, Joe Biden and Barack Obama were taken over and used to request that money be sent to cryptocurrency accounts. A number of people fell prey to the scam which is being called the largest hack in Twitter’s history. In some cases, messages received thousands of likes before they were taken down. It was confirmed by Twitter that the hackers used Twitter’s own administrative tools to take over the accounts. The scam first started when the twitter account of tech billionaire Elon Musk was compromised and a suspicious message requesting money was tweeted. Similar messages were then posted from the accounts of other famous personalities. Numerous law enforcement agencies have started investigating the hack and teenagers from the UK and US have been arrested in connection to the attack.
- Casey Newton, “The massive Twitter hack could be a global security crisis” The Verge (July 15, 2020).
- Staff, “Twitter hack: US and UK teens arrested over breach of celebrity accounts”, The Guardian (July 31, 2020).
- Joseph Marks, “Twitter breach is another warning shot for election security”, The Washington Post (July 16, 2020).
- Jaijit Bhattacharya, “Global Twitter Hack Proof Of How Democratic Elections Can Be Manipulated”, Outlook (July 18, 2020).
- David E. Sanger, Nicole Perlroth & Nick Corasaniti, “What the Twitter Hack Revealed: An Election System Teeming With Risks”, New York Times (July 16, 2020).
Microsoft inching closer to deal to buy TikTok operations in the United States
Microsoft is close to agreeing a deal to take over the operations of ByteDance’s popular app Tiktok in the US, with the company valued at $15 to $30 billion. However, the deal has been paused amid the Trump administration’s concerns regarding the app’s purported threat to national security concerns. On its part, TikTok has promised to create employment opportunities for over thousands of people among other concessions. Though the exact mechanism is yet to be decided, the likely course of actions seems to be a divestiture of TikTok in the US. Assuming the deal goes through, Microsoft will enter the discussions on free speech over social media, a hot button issue which was reopened through the recent antitrust hearings in Washington.
- Sarah Frier, “TikTok Draws Interest From Bidders Other Than Microsoft”, Bloomberg Quint (1 August 2020).
- Kim Lyons, “Microsoft reportedly puts TikTok acquisition talks on hold”, The Verge (1 August 2020).
Apple wins $15 Billion EU court case
The second highest court in the European Union nullified a European Commission order for Apple to pay $15 billion to Ireland in back taxes. The case related to an alleged unfair tax deal struck between Ireland and Apple which reduced Apple’s tax burden for two decades to less than 1% in corporate taxes. Ireland has a favorable taxation policy for tech companies which makes it a global hub for hundreds of multinationals that are attracted by its low 12.5 per cent corporate tax rate and EU market access. This was the EU body’s second failed attempt to demonstrate that a multinational company benefited from state aid, after its earlier case involving Starbucks was overturned. The court held that the EU body did not succeed in “showing to the requisite legal standard” that the tech giant had received an illegal economic advantage in Ireland over its taxes.
- Andrew Walker, “Apple has €13bn Irish tax bill overturned”, BBC (July 15, 2020).
- Keith O’Donnell, Samantha Schmitz & Marie Bentley, “Apple Case: EU Judges Confirm That The European Commission Had It Wrong”, Mondaq (July 23, 2020).
- Stephanie Bodoni, “Apple, Facebook Court Spats Test EU Role as Global Rulemaker”, Bloomberg Quint (July 14, 2020).
- Josh White, “Apple wins EU state aid battle over Irish tax structure”, International Tax Review (July 15, 2020).
Turkey passes new social media law
The Turkish parliament has passed a new law on 29th July which gave the government greater powers over content posted on social media platforms like Facebook and Twitter. The law mandates that social media companies must keep their representative offices in Turkey so that complaints regarding online content can be regulated more effectively. In the scenario that the law is not complied with and an official representative is not designated, the government can employ a series of measures including bandwidth reductions, steep fines etc., which impact freedom to access the concerned websites. The law has been labelled as draconian by free speech activists and opposition parties.
- Marc Santora, “Turkey Passes Law Extending Sweeping Powers Over Social Media”, New York Times, (July 29, 2020).
- Gul Tuysuz, “Critics fear Turkey’s new social media law could hurt freedom of expression. Here’s how”, CNN, (July 29, 2020).
- Staff, “Turkey: Social Media Law Will Increase Censorship”, Human Rights Watch, (July 27, 2020).
- Richard Wingfield, “Risks and responsibilities of content moderation in online platforms”, Open Global Rights, (August 1, 2018).