Comments on the Srikrishna Committee Report and the Draft Data Protection Bill 2018 – I

Posted on by Tech Law Forum @ NALSAR

[Ed Note : The following series of posts contain comments on the Srikrishna Committee Report and the Draft Data Protection Bill, 2018 made and compiled by students from NALSAR University of Law -Ankush Rai, Ashwin Murthy, Arvind Pennathur, Namratha Murugesan, Priyamvadha Shivaji, Shweta Rao, Sriram Kashyap, Vishal Rakhecha and Tanvi Apte. The comments have been uploaded on the Ministry of Electronics and Information Technology (MeitY) website. 

The present post deals with comments made in relation to four issues that arise in relation to the Report and Draft Bill – a) vagueness, b) government interference, c) the data protection authority and d) surveillance. 

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TechLaw Symposium at NALSAR University of Law, Hyderabad – Press Note

Posted on by Tech Law Forum @ NALSAR

[Ed Note : The following press note has been authored by Shweta Rao and Arvind Pennathur from NALSAR University of Law. Do watch  this space for more details on the symposium!]

On the 9th of September NALSAR University of Law’s Tech Law Forum conducted its first ever symposium with packed panels discussing a variety of issues under the broad theme of the Right to Privacy. This symposium took place against the backdrop of the recent draft Data Protection Bill and Report released by the Srikrishna Committee.

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Mr. Shailesh Gandhi on Privacy

Posted on by Tech Law Forum @ NALSAR

[Ed Note : The following is a guest post by Mr. Shailesh Gandhi, Former Central Information Commissioner under the framework of the RTI Act 2005, who has graciously agreed to express his views through this platform]

First Define ‘Privacy’

The problem with the nine-judge ruling is that after proclaiming privacy as a fundamental right, it has not defined what is privacy. It is now left to all adjudicators to give multiple interpretations in order to understand the term, writes Shailesh Gandhi.

The judgment of the nine-judge bench of the Supreme Court on privacy has been hailed with much enthusiasm. The right to privacy question was referred to this bench after a clutch of petitions challenging the Aadhaar Act came up before a five-judge bench. This article is an attempt to look at the consequences of the privacy ruling.

All laws and institutions in India are expected to be guided by the Constitution. To ensure that the Constitution can take changing circumstances into account Parliament has been given the authority to amend it in Article 368. The constituent assembly in its initial drafts had considered making the right to privacy a fundamental right. However, after extensive discussion, a conscious decision was taken not to do so.

An eight-judge bench of the Supreme Court had clearly come to the conclusion that the right to privacy is not a fundamental right (M P Sharma vs Satish Chandra) DM Delhi)2 in 1954. At that time, most of the members of the constituent assembly were also around, and there does not appear to have been any significant dissent with this decision. Thus it appears that the clear and conscious decision of the Constitution makers and all the Supreme Court judges (since that bench comprised all of them) was that privacy was not a fundamental right. The Supreme Court has the authority to interpret the Constitution and the law, but the authority to amend both clearly lies only with Parliament.  It is worth contemplating whether a bench with about 33% strength should consider superseding an earlier judgment given by one  of 100% strength. Besides, the 1954 judgment appears to be in consonance with the deliberations of the constituent assembly.

In the current judgment the apex court has recorded on page 204 at para 144:

On 17 March 1947, K M Munshi submitted Draft articles on the fundamental rights and duties of citizens to the Sub-committee on fundamental rights. Among the rights of freedom proposed in clause 5 were the following

…(f) the right to the inviolability of his home

(g) the right to the secrecy of his correspondence,

(h) the right to maintain his person secure by the law of the Union from exploitation in any manner contrary to law or public authority…”.

At para 148 on page 207 the apex court comes to the conclusion that

This discussion  would indicate that there was a debate during the course of the drafting of the Constitution on the proposal to guarantee to every citizen the right to secrecy of correspondence in clause 9(d) and the protection to be secure against unreasonable searches and seizures in their persons houses, papers and assets. The objection to clause 9(d) was set out in the note of dissent of Sir Alladi Krishnaswamy Iyer and it was his view that the guarantee of secrecy of correspondence may lead to every private correspondence becoming a state paper……. The clause protecting the secrecy of correspondence was thus dropped on the ground that it would a serious impediment in prosecutions while the protection against unreasonable searches and seizures constitute was deleted on the ground that there were provisions in the Code of Criminal Procedure, 1898 covering the area. The debates of the Constituent Assembly indicate that the proposed inclusion (which was eventually dropped) was in two specific areas namely correspondence and searches and seizures. From this, it cannot be concluded that the Constituent Assembly had expressly resolved to reject the notion of the right to privacy as an integral element of the liberty and freedoms guaranteed by the fundamental rights.

I am not able to see this conclusion flowing from Munshi’s draft which has been recorded at para144.  The draft which has been quoted appears to prove that the constituent assembly took a conscious decision not to accord privacy the status of a fundamental right, and this was confirmed by the Supreme Court bench in 1954.

 

It is true that the Constitution has to evolve with changes in the world, international covenants and changing realities and expectations of the people. But it has clearly defined the roles of the three estates, and the legislative function has been given to  Parliament, which draws its legitimacy directly from the citizens who elect its members. Just as a percentage of members is specified for a constitutional amendment in Parliament, should not a percentage of judges of the Supreme Court be required to overturn an earlier ruling of this nature?  There may be serious implications in future of such a transfer of powers.

What is Privacy?

It is evident that privacy is built into the common law in various ways. The real problem with the nine judge judgment is that after proclaiming privacy as a fundamental right, it has not defined what is privacy. It is now left to all adjudicators to give multiple interpretations to understand the term. Earlier in R Rajagopal vs State of TN3 the Supreme Court had given a broad definition of privacy and its domain where it stated that:

The right to privacy is implicit in the right to life and liberty guaranteed to the citizens of this country by Article 21. It is a “right to be let alone”.

A citizen has a right to safeguard the privacy of his own, his family, marriage, procreation, motherhood, child-bearing and education among other matters. The Court could have defined this in a more precise way and then allowed some matters to be adjudicated. It must be appreciated that the right to privacy has a certain tension with Article 19 (1) (a) of the Constitution which guarantees that “All citizens shall have the right to freedom of speech and expression.”

From this is drawn the freedom to publish and the right to information (RTI). What can be published in matters relating to citizens in the media is the same as information from public records which can be given in the right to information. The reasonable restrictions on the exercise of this are given in Article 19 (2) and can only be  “in 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.” Which of these will apply to privacy? In most cases restrictions in the interest of  “decency and morality” would have to be invoked for restricting publication or information in RTI in matters relating to privacy. The RTI Act also bars such information from being given under Section 8 (1) ( j) which exempts information which relates to personal information the disclosure of which has no relationship to any public activity or interest, or which would cause unwarranted invasion of the privacy of the individual unless the Central Public Information Officer or the State Public Information Officer or the appellate authority, as the case may be, is satisfied that the larger public interest justifies the disclosure of such information: Provided that the information, which cannot be denied to the Parliament or a State Legislature shall not be denied to any person.”

Parliament had laid down a simple acid test to determine which personal information should be  denied under the RTI.  If such information would assault  “decency or morality” it would violate privacy and should not be given to Parliament also. Thus the R Rajagopal judgement and the RTI Act both are in consonance with Article 19 (2) of the Constitution. It would have been good if the Supreme Court had reiterated this or expanded it. Presently some of the information that is often  denied under the RTI under Section 8 (1) (j) is as follows:

  1. i) Allocation of subsidised plots to politicians, officers and judges.
  2. ii) Beneficiaries of various subsidy and other welfare schemes: There are many ghost beneficiaries. Some who are really wealthy also avail of these.

iii) Educational, caste, income certificates of people: There are instances where RTI has uncovered fake education certificates even of doctors working in government hospitals.

  1. iv) Marks obtained in competitive exams: In many cases people with higher marks have not been chosen.
  2. v) Foreign visits.
  3. vi) Details regarding a public servant: memos, show cause notices, censure/punishment awarded, details of movable and immovable properties, details of  investments, lending and borrowing from Banks and other financial institutions, and gifts received. These have been refused by the Supreme Court in the Girish Deshpande4 On the other hand in the ADR-PUCL case the Supreme Court ruled that citizens have a right to know the assets and liabilities of those who want to become public servants (stand for elections).

vii) Income Tax returns: It is a fact that the affidavits of politicians who stand for elections are never verified with their IT returns. These are not given in RTI also.

Misinterpretation of RTI

In some instances when such information has been disclosed it has led to the exposure of corruption. One of the objectives of the RTI (stated in its preamble) is to curb corruption. Because of the varied positions taken by the public information officers (PIO), information commissioners and Courts, the law is grossly misinterpreted. In fact, many state governments have issued directives to all the PIOs not to disclose information about public servants. With this decision of declaring privacy as a fundamental right without making any attempt to judicially define it, many wrong deeds will thus get protection. We must also understand that the same constraints will apply to the freedom to publish. If giving information about some matters is intrusion into privacy, then publication of it also cannot be permitted.

 

There are many more cases in which personal information is disclosed by some PIOs and denied by others on the basis of it being an invasion of privacy. All personal information does not constitute privacy. One of the most favourite exemptions to deny information is Section 8 (1) (j). In most cases the legal requirement of deciding whether it would be denied to Parliament is not applied. The right to privacy ends where the RTI and the right to publish starts.  It is unfortunate that the nine member bench of the Supreme Court decided to proclaim privacy as a fundamental right, but did not take the responsibility of defining its domain. The PIOs, information commissioners and judges are now left to do this job on a  “case to case” basis. There should be an attempt to make law as definitive as possible. It is evident that matters relating to a person’s body, home, sexual preferences, religious or political beliefs, should generally be considered as issues relating to privacy. These could be justified by Article 19 (2) which permits reasonable restrictions on the basis of  “decency or morality.” However, with respect to a person’s body there have been some divergent opinions. The most easily identifiable part of a person’s body is the face. Can we now argue that taking a person’s photo and disclosing it or publishing it is an invasion of privacy?

 

Aadhar and Privacy

One of the primary causes for this entire controversy regarding privacy has been the Aadhar card and the requirement for linking it with all other interactions with government. Most of those who read this article are likely to be in favour of the domain and importance of privacy being extended. The personal details taken for Aadhar, which may not be given in many other government records,- are the biometric identification in terms of fingerprints and iris scans. Everyone going out of the country (and a large  percentage of  readers of this article) give their biometric identity at the emigration counter. Universal requirement of the Aadhar card is likely to reduce benami transactions and ghost names of beneficiaries.

The argument was made before the Supreme Court that privacy is an elitist concern. The Supreme Court disagreed. Citizens have said that all their transactions may be connected with Aadhar. The fact that corruption is one of our major concerns cannot be denied. I guess we must also admit that our governments are unable to really curb this. We have a number of people having multiple PAN cards, floating shell companies, and taking illegal benefit of various welfare schemes and so on. A large number of private companies are registered at the residences of public servants. These actually snatch morsels from the mouths of the disadvantaged. There may be some inconvenience for some people and perhaps some embarrassment. Calling the house a castle and saying privacy is an essential part for a dignified life sounds really good. If this were possible without reducing the scope of the RTI and the freedom to publish it would be fine. There is a possibility that the right to privacy will be at the cost of the right to information. Sometime in the future the freedom to publish may also be curbed.

There are perhaps two competing issues in thinking of the desirability of Aadhar: Concern for privacy and the need to curb corruption and leakages in welfare schemes. Going by the talisman of Gandhiji one should consider which step is likely to benefit the poor. It appears evident to me that having an Aadhar card linked to most government transactions will benefit the poorest in at least getting basic amenities.

Conclusions

It appears that Supreme Court, has, in claiming to interpret the Constitution, read it to claim that a concept discarded by the constituent assembly was meant to be included. In this decision the Supreme Court should have defined privacy and its contours. When deciding on the definition of privacy Article 19 (2) must be kept in mind and the RTI and the freedom to publish must not be curbed beyond what the Constitution permits.

The greater good is likely to be served by having an Aadhar card.

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The Data Protection Act

Posted on by Tech Law Forum @ NALSAR

[Ed Note : The following is a guest post by Mr. Shailesh Gandhi, Former Central Information Commissioner under the framework of the RTI Act 2005, who has graciously agreed to express his views through this platform]

If any proof was required that the RTI Act is seriously threatening the arbitrary and corrupt actions of those who are powerful, the proposed Data Protection Bill provides it. The Supreme Court of India in various decisions before the advent of the RTI Act acknowledged that the Right to Information and Right to publish are fundamental rights of citizens under Article 19 (1) (a) of the constitution which guarantees freedom of speech and expression. Any constriction of this right can be based only on what the constitution permits. Article 19 (2) permits reasonable restrictions on the exercise of this right only “in 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.”

Section 8(1) of the RTI Act lists the types of information which may be denied to a citizen. Section 8 (1) (j) covers denial of personal information thus: “information which relates to personal information the disclosure of which has no relationship to any public activity or interest, or which would cause unwarranted invasion of the privacy of the individual unless the Central Public Information Officer or the State Public Information Officer or the appellate authority, as the case may be, is satisfied that the larger public interest justifies the disclosure of such information:
Provided that the information, which cannot be denied to the Parliament or a State Legislature shall not be denied to any person.”
The law intends to deny information which is not related to any public activity or which would be an unwarranted invasion of an individual’s privacy. Since it does not define privacy, it must be read with Article 19 (2). The two words which could cover privacy are ‘decency or morality’. To make it easier to implement this clause it made a special proviso that when denying information the person denying it should make his subjective assessment whether he would deny it to parliament. Information which would invade privacy of an individual,-violating ‘decency or morality’-should not be given to parliament also. Details of ghost beneficiaries of government schemes, Adarsh Scam, False certificates and affidavits, foreign visits, lack of action against tainted officers and many other illegalities have been unearthed by a citizens using the Right to Information Act. Some of the actions, which RTI act can bring to light are:

  1. Allocation of subsidized land to politicians, officers and judges.
  2. Beneficiaries of various subsidy and other welfare schemes: There are many ghost beneficiaries and some who are wealthy also avail of these.
  3. Educational, caste, income certificates of people: There are instances where RTI has uncovered fake education certificates even of doctors working in government hospitals.
  4. Marks obtained in competitive exams: In many cases people with higher marks have not been chosen.
  5. Foreign visits of public servants.
  6. Details regarding a public servant: memos, show cause notices, censure/punishment awarded, details of movable and immovable properties, details of investments, lending and borrowing from Banks and other financial institutions, and gifts received.
  7. Gross arbitrariness and corruption in selections for jobs and non-conformance to rules and laws.
  8. Disproportionate assets compared to declared income.
  9. Unfair assessment of students and job seekers in government.
  10. Disregard of proved corruption charges against officials.

Since this law is highly unpopular with most people in power, governments had initiated four attempts so far to amend the RTI Act to weaken its impact.  These had to be withdrawn because of strong opposition from citizens to defend their RTI. Citizens have realized that this law gives them an opportunity to monitor accountability, keep corruption in check and convert India into a true , participatory democracy. Most statutory bodies commissioned to do this are not able to deliver in any significant manner. The citizens working individually have been fairly effective in this endeavor with the help of the RTI Act. It is also a fact that no great harm has been reported due to disclosure of information.
Now comes a fresh and dangerous attack in the proposed “Personal Data Protection Bill” which suggests amending RTI. This is being done by asking for an amendment to the citizen’s Right to Information! In the garb of protecting personal data and privacy, it asks for an amendment to Section 8 (1) (j). It is worth mentioning that a Group of Experts on Privacy under Justice AP Shah which was asked for inputs for a Privacy Bill had recognized the importance of ceding to the RTI Act and said: “The Privacy Act should clarify that publication of personal data for artistic and journalistic purposes in public interest, use of personal information for household purposes, and disclosure of information as required by the Right to Information Act should not constitute an infringement of Privacy.” Unfortunately, this wisdom has not been displayed by the proposed “Data Protection” bill.

The bill suggests changing the exemption for Section 8 (1) (j) to:

“ information which relates to personal data which is likely to cause harm to a data principal, where such harm outweighs the public interest in accessing such information having due regard to the common good of promoting transparency and accountability in the functioning of the public authority;”

Thus any information with the name of a person can be denied! It is unlikely that various officers will be able to determine whether any claimed harm to a person is greater or there is a larger public interest. The bill is confused about Article 19 (1) (a). It seeks to exempt ‘journalistic purposes’ from most of the restraints on data sharing but curbs citizen’s RTI. This is not in consonance with the constitution and many earlier judgments of the Supreme Court given before the advent of the RTI Act. The right to publish arises from the citizen’s right to information.

Citizens need to defend the RTI Act from such continuous attacks on their fundamental right by those with power. How often will we battle for this? The Expert Committee under Justice A.P.Shah had shown due to respect to the citizen’s right. Citizens must now reach out to political parties and elected representatives and demand that they give a commitment not to make any amendments to the RTI Act. If they want our vote, let them promise our fundamental right.

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Net Neutrality And Economics 101 (Part II)

Posted on by Prateek Surisetti

In Part I, I attempted to provide an overview of the ISP market structure, market players and associated economic phenomena. In Part II, we will be discussing the more specific topic of Net Neutrality and its intersection with economics.

Please note that over the course of the ensuing write-up, I have referred to two kinds of fees:

(i) Fee imposed by the ISP on the end-consumers

(ii) Fee imposed by the ISP on the content providers.

So, please pay close attention to the exact nature of the fee throughout the piece.

PART I RECAP

In an earlier 101 post, we discussed how the advent of Net Neutrality laws would restrict Internet Service Providers (ISPs) from imposing differential rates and therefore, such laws would be beneficial for Content Providers (CPs) that transfer higher than average amounts of data, such as Netflix. This is because in the absence of Net Neutrality, Netflix and the sort would have to pay a fee proportionate to the extent of bandwidth they use, as opposed to a flat rate.

Moving on, in Part I, we discussed the effects of the market structure on said flat rate. It’s to be noted that the flat rate (imposed on CPs, as opposed to end-consumers) shall tend to remain modest on account of ISP’s interest in courting a healthy inflow of content.  At the risk of stating the obvious, a higher flat-rate could alienate CPs of lesser financial might.

Apart from the above, note that the rate imposed on end-consumers will, also, tend to remain low on account of ISPs preferring to acquire returns from CPs, rather than the more mercurial end-consumer market. In other words, the two-sided market structure exerts a downward push on both the flat-rate imposed on CPs and end-consumers. [refer Part I, Demand Elasticity (Last Paragraph)].

The above analysis discusses purely the general economic phenomena effecting the prices as a consequence of the market being two-sided. There exist other ISP market specific variables and phenomena, discussed below, which affect price as well.

ANALYSIS

Effect on End-Consumer Tariff:

Sridhar V and Rohit P’s EPW article (reference provided below) suggests that the effect of a differential pricing system on end-consumers’ ability to afford services affiliated to the internet can’t be ascertained conclusively. In status quo, a modest flat-rate (payable by CPs) ensures a larger participation of CPs and consequently, payments (notwithstanding modest rates) from CPs could offset the negligible fee cast on end-consumers by ISPs. But if the fee is increased for certain CPs, those providers would want to recover their costs from consumers, though the ISPs’ customer fee might lessen. Therefore, it isn’t possible to make a conclusion with regards to the effect on the consumer’s ability to afford internet services, because of the difficulty in predicting the interaction between the various variables involved. Such variables would include the number of CPs, tendency of CPs to charge end users for services, et cetera.

Fragmentation:

Content on the internet, as we know it today, remains uniform across ISPs. Due to a modest flat-rate, almost every CP can access end-consumers of every ISP. But, in the absence of neutrality in pricing, compounded with the possibility of fee for CPs shooting up, financially weaker CPs mightn’t be able to afford being accessible on all ISPs, thereby, possibly leading to the fragmentation of the internet. It is argued that fragmentation isn’t ideal as it’s preferable to have a more information rich internet that is interconnected (e.g. hyperlinks) in the fascinating way that it is in today’s world. For instance, one wouldn’t be able to access certain links from a particular ISP as it mightn’t provide access to all content (refer here).

Imbalance of Power, Network Effect, Bottleneck Oligarchies:

The ISP market in essence is an oligarchy. More specifically, a “bottleneck oligarchy”. The ISPs control, what experts call, the “last mile”. Essentially, they serve as the gate keepers of the internet for the end users.  ISPs hold the switch for enabling or disabling access of particular content to its end user. This puts them in a position of power ripe for exploitation.

It is very difficult to build competition in a market such as the ISP market because of the high initial costs for setting up infrastructure, the high switching costs (giving the early bird an enormous advantage) and finally the “network effect”.

The network effect works in markets where a product’s value to an existing consumer increases with every additional customer added (e.g. social networking sites). In order to better understand how more users of an ISP would increase the value of the ISP, let us consider a hypothetical situation. Imagine an apartment, where fifteen people use Comcast, while five use Verizon. Verizon will have to set up cables till the apartment for those five users. If Verizon were to acquire Comcast it could substantially reduce it’s per head cost to a greater extent, making it cheaper for the customer. This network effect creates a situation where companies aggressively seek to acquire other smaller competitors. Therefore, there is a high chance that there only remain a few competitors at the end, resulting in a monopoly, or an oligarchy at best. This results in a situation where there are only a few ISPs but several CPs. Therefore, an oligarchic ISP market further reinforces the imbalance of power between the ISPs and the CPs.

The above-mentioned power imbalance, as a consequence of the bottleneck oligarchy coupled with the network effect, allows ISPs to extort CPs. Therefore, having Net Neutrality laws are important to deal with this imbalance and the resultant anti-competitive practices. Regulation is especially important because ISPs might be providing other services [for instance, Alphabet provides both ISP (Google Fiber) and CP (Google search-engine) services] which might be in direct competition with services provided by CPs. (refer below for section titled “Vertical Integration”)

An example of exercise of such power can be seen in Comcast’s dealing with Level 3 Communications in 2010. Comcast severely slowed down access to the later, until it paid a certain fee. Level 3 Communications finally paid up for ensuring access, but not before likening Comcast’s activities to extortion.

To briefly summarize, we have analysed the existence of a power imbalance between ISPs and CPs (as a result of bottleneck oligarchies and the network effect) and the potential for misusing said power imbalance in the absence of laws protecting Network Neutrality.

Vertical Integration:

And finally, there is also the problem of vertical integration. Let us have a look at Google. Google started out as a CP, but over time, it has also entered the market of ISPs through its highly hyped Google Fibre. Where the ISP and the CP are either run by the same organization or by two organizations that are bound by an agreement, vertical integration is said to have taken place. In such a scenario, the absence of Net Neutrality rules would allow companies like Google to have an edge over other CPs and consequently deal in anticompetitive practices (refer here). For example, access to online markets involving Google’s creations could be easier than competitor’s products. In such a scenario, the only enforceable option would be to disallow Google (the ISP), from going into the type of content going through its cables. Furthermore, having a flat rate, disallows Google (the ISP) from discriminating against other CPs.

But of course, apart from laws ensuring Network Neutrality, the concerns raised regarding abuse of power imbalance could be dealt through Competition Law as well.

The Free Lunch. Increasing Traffic & Artificial Scarcity:

ISPs argue that CPs, such as Netflix, get a “free lunch” at their expense. In 2006, Verizon contended that ISPs, such as itself, put in a lot of capital into building infrastructure that allows access to the internet, while companies such as Netflix merely have to set up a server. Putting the burden on the end consumers for all the capital put into infrastructure would mean that ISPs will have fewer customers, as consumers are more sensitive to price changes than CPs. As a result, ISPs argue that CPs should be charged for this service because it makes more economic sense.

They take this argument further to claim that there is little incentive to expand their infrastructure if companies which take up a large of the bandwidth do not compensate them for the usage. They go further to claim that in the absence of improved infrastructure, it is those companies which require high quality services that will be affected the most.

Next, ISPs raise traffic management concerns against Net Neutrality. In a world where pressure on network infrastructure is increasing (i.e. congestion), where data transferred on the same lines has increased by four times over the course of five years (2010 to 2015), it is imperative for ISPs to improve infrastructure. Otherwise, there will be a drop in quality of service. And consequently, services which rely on high quality transmission will fail. For example, voice calls, which depend on quick transmission, will suffer in the present “best effort” system (Neutral Network). Consumers would naturally go for services which require a smaller bandwidth, because they will load faster.  

Though this argument seems to be convincing, one must take note of the actual congestion of network at the moment, instead of relying on mere claims by the ISPs. If there is no congestion, there exists no need for traffic management or infrastructure improvement.

Additionally, there exists a counter-position that having Net Neutrality laws would disincentivize ISPs from investing in infrastructure. Herein, we need to understand the concept of “Artificial Scarcity”. As regards to this concept, the idea is that ISPs will always claim that the network is congested and the existing infrastructure is not enough. That way they will be able to justify traffic management and “Paid Prioritization” (faster access to CPs who pay up). So, even in a scenario where end users are able to properly access all CPs even in the absence of traffic management, they could fake scarcity in order to charge CPs for providing access. As a result of this, not only will smaller CPs not be able to compete, but effective cost for end users might also rise, leading to a part of the market being left out.

A continuation of this argument is that ISPs would want to maintain a condition of network congestion, so that they can continue charging CPs with a tariff. Otherwise, ISPs would have to expand their infrastructure in order to maintain quality of service and provide access to all CPs at the same time. In the absence of Net Neutrality laws, they have lesser incentive to do the latter. (Refer here.)

Furthermore, in a situation where a particular CP is pumping out large amounts of data, a convenient step for the ISP to take would be to remove that particular CP from the scene to relieve congestion temporarily, instead of the more appropriate, yet resource heavy task of improving infrastructure.

Hence, having Net Neutrality laws would incentivize ISPs to invest in infrastructure to maintain quality standards and disincline ISPs from indulging in stop-gap measures (discrimination on the basis of payment and traffic management).

To briefly recapitulate, we have analysed the issue by pitting the concerns of free lunch and increasing traffic against artificial scarcity.

TAKEAWAY

After discussing the argument that it isn’t possible to conclusively predict the effects of Net Neutrality on end-consumer tariffs, we discussed the possibility of Fragmentation as a consequence of eschewing Network Neutrality.

Next, we discussed the inherent power imbalance between ISPs and CPs, in addition to allied concepts of bottleneck oligarchy, network effect and vertical integration.

Finally, we discussed the issues associated with arguments favouring greater traffic management in relation to the free lunch argument and the artificial scarcity argument.

Chief References:

Sridhar V & Rohit Prasad’s The Economics of Net Neutrality. Further here & here.

 

Image taken from here.

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Privacy & Transparency as Complementary Rights: Inadequacies in the Proposed Amendments to the RTI Act

Posted on by Tech Law Forum @ NALSAR

[Ed Note : The following cross – post, authored by Sayan Bhattacharya of NALSAR University of Law, was first posted on the Law School Policy Review. The link to the same can be found here. ]

By leaving essential terms undefined and placing a higher burden to disclose personal information, the amendments proposed by the Srikrishna Committee are defeating the purpose of a right to privacy i.e. to make the state more transparent and the citizen less transparent.

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Admissibility of Secondary Digital Evidence in Courts

Posted on by Tech Law Forum @ NALSAR

[Ed Note: The following is a guest post by Shriram Kashyap, a second year student of NALSAR University of Law.]

The sudden influx of computers brought about major changes in the legal framework for regulating technology in India. The Information Technology Act 2000 (hereinafter the ‘IT Act’) was one such change that impacted various fields, including Criminal Law and Law of Evidence. The Indian Evidence Act, 1872 was one of the many Acts that was amended by the IT Act, and it introduced the concept of digital evidence to Indian Courts by adding Sections 65A and 65B, which describe the procedure to produce electronic evidence in courts during criminal trials and the admissibility of the same. These sections minimise the risk of falsification of digital evidence through various stipulations.

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A Note On Monsanto vs. Nuziveedu

Posted on by Rithvik Mathur

In the recent judgement in the High Court of Delhi in Monsanto Technology LLC and Ors. v. Nuziveedu Seeds Limited and Ors, the Delhi High Court has single-handedly devastated the Biotechnology (Bt.) industry in India. The Bianchi Law Firm in Red Bank, NJ on observing the recent judgement contended that it  will have far-reaching consequences on multiple sectors such as genetic modification and biotechnology, pharmaceuticals and the agriculture industry.

Brief Facts and Monsanto’s Patent Claims

Through a Government notice from the Department of Agriculture, the trait fees, or the fees charged for seeds with genetic coding for a specific characteristic (such as pest resistance, or higher yield), were revised for certain seeds including Bollgard and Bollgard II of Monsanto, a Fortune 500 global conglomerate.You can also contact experts from pest control janesville wi to avail pest control services.

Subsequently, Monsanto terminated a contract with Nuziveedu, a seed distributor working in India, for the licensing of the seeds after Nuziveedu challenged the trait fee charged by Monsanto and demanded damages alleging breach. Nuziveedu in response challenged Monsanto’s patent claims on the ground that plants and essentially biological methods of making them may not be patented.

Of the several claims, which largely involved the multiple processes in creating the particular plant varieties, claims 25-27 are relevant as per the judgement.

Essentially, Monsanto’s claim was that of a patent over the specific gene sequences that enable the cotton variety to produce its resistance as vigorously as it does through the use of a toxin which it produces. Monsanto has applied for a patent over the genetic sequence, or the recipe, created to produce the toxin as well as a promoter, which is needed to induce the process of making the toxin. This creates a trait that enables cotton plants to produce a substance that is toxic to pests, such as bollworms. The plant with this trait is then crossbred with local varieties for creating a variety that inherits the characteristics that local species developed to thrive in the given area. To effectively reduce or eradicate the pests that are bugging you, it is advised to plan for your termite extermination with the help of a reputed pest control company like Pelican pest control.

The High Court decided that Monsanto could not patent Bt. Technology under the Indian Patents Act 2001 (Patents Act). However, Monsanto was granted protection for the plant varieties it claims a patent over under the Plant Variety Protection and Farmer’s Right Act 2002 (Plant Variety Act). It also decided that Monsanto had illegally terminated the contract, as mentioned earlier.

To elaborate, the court held that the patent granted was only for the identification of the event as opposed to the method of creating the seed. This implies that the patent extends to inventing the proper gene sequence and creating a cell with the same sequence. It does not extend to the cell creating a plant. Essentially, the Court has separated the creation of the modified cell and the creation of the modified plant as two separate events. The method of creating the seed involves what the court considers “essentially biological processes” as per Section 3(j) of the Patents Act. The phrase has not been defined in statutes, but in this context, it refers to reproduction and cell division.

Once we replace essentially biological processes with cell division and reproduction, it becomes much easier to understand the court’s fallacy. “Essentially Biological Processes” are those processes that naturally occur in organisms. Section 3(j) implies that patenting the production or creation of something is prohibited when those means are “essentially biological processes.”

Therefore, the Court has denied Monsanto its patent claim over the processes and products involved in creating the plant and has given them patent only over the event. The holding essentially means that Monsanto only has rights over a narrower construction than they claim of patent over both the identification of the event and the creation of the seed. In cross-breeding the Bt. Cotton variety with a local variety, the product is no longer a microorganism and cannot benefit from the exemption in 3(j) of the Patents Act. The significant part of the analysis was to show that plants could not be patented and that their product was at the end of the day, a plant, as it was created using essential biological processes such as reproduction.

Essential Biological processes and Genetic Modification: Is there a Difference?

I find that the general narrative, in the cases relied upon, involved protecting essential biological processes, for example, selective breeding to create a more robust variety. Such processes may occur naturally. However, the entire strain of seeds sown could not have been created without human intervention. While there was cross-breeding with local varieties, should such cross-breeding vitiate the entire right over property that was created by Monsanto? Such reasoning is fallacious because what may apply to one part of this process need not apply to the entire process. The process may have involved crossbreeding to make the product better suited to Indian conditions, that does not mean the entire process is a result of this single step. Faking an accent does not make one British or change one’s personality. Similarly using crossbreeding does not make the entire method an essentially biological process. It cannot be reduced to one single step.

Further, the court has drawn analogies between our laws and foreign decrees after disregarding relevant differences. Many of the cases do not specifically note the difference between crossbreeding and genetic modification. When the court asserts that Monsanto tried to patent what is an “essentially biological process”, it implies that such a hybrid can be created naturally through reproduction and cell division alone (cross-breeding between plants). However, looking at the progress in the field, it is astronomically unlikely that crossbreeding will result in bacterial genes expression in plants. Even if the claims of patents over the plant itself are invalid, the method of their development cannot be reduced to essentially biological.

Are There Adequate Protections Under the Plant Variety Act?

The High Court also suggests that protection under the Patents Act and protection under the Plant Variety Act are mutually exclusive and suggest the latter for protecting interests in transgenic plant species. Arguing that the Parliament enacted the latter shortly after adding s. 3(j) with the knowledge of both, there was legislative intent to make them mutually exclusive. However, the protections available under this act are not adequate. Simply because such a change would permit several groups to create their variety with such a trait, out of the transgenic crops, the biotechnology industry in India will see severe repercussions. Such products are quickly outdated; bollworms are reportedly becoming resistant to Bt crops. There is no longer an incentive to develop/sell such seed in India. Companies will respond by exiting the Indian market, taking away the option of using Bt. crops from farmers.

While an urge to protect or assist farmers who cannot afford such exorbitant pricing is noble, if indeed this was one of the motivating factors behind the decision, demolishing protections available to biotechnology and transgenic crops does nothing to ease their plight.

The Supreme Court has declined to stay the High Court’s Order in the previous listing in May; the case is likely to be listed again in mid-July. Whether or not there is a change in the court’s approach remains to be seen.

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Network Neutrality Around The World : A Basic Overview

Posted on by Prateek Surisetti

Network Neutrality () refers to a network wherein participants are effectively blind to the nature of data flowing through the network. Another way of defining NN is a network wherein participants are restricted from differential treatment of data flow. Please understand that the definitions provided above are, in cliché speak, two sides of the same coin. Even if a participant can distinguish the nature of data flowing through a network, the participant is considered to be effectively blind, if said participant doesn’t interfere with the data flow. I have discussed the basic concepts and issues surrounding NN here.

A particular manner of interference includes discriminatory pricing, wherein Internet Service Providers provide different bandwidths to content providers (Netflix, YouTube, et cetera) based upon the extent of payment received.

In India, the debate took off when Airtel charged customers for voice calls over apps like WhatsApp, Skype and such OTT (Over-The-Top) services. This was bound to happen as most Internet Service Providers also control traditional services such as telephone services, whose profits are diminishing due to content providers like Skype (e.g. Airtel).

TRAI, or Telecommunication Regulatory Authority of India, after releasing a consultation paper in the March of 2015, prohibited discriminatory pricing through the “Prohibition of Discriminatory Tariffs for Data Services Regulations, 2016”. For theoretical clarity, we need to understand that the absence of discriminatory pricing doesn’t necessarily mean that the network is neutral, but the majority of the debate has revolved on a discriminatory pricing versus NN basis and therefore, prohibition of discriminatory pricing has been characterized as NN. Essentially, interference with data traffic is antithetical to network neutrality, but traffic could be interfered with either on the basis of discriminatory pricing (allowing those paying higher a greater bandwidth) or through other mechanisms too (e.g. blocking flow of data for vested interests such as political or commercial concerns).

Various experts in the field had suggested that the Indian government to go the US way, i.e. to effectuate rules to regulate after viewing how the absence of NN rules plays out, rather than regulating from the beginning itself. But TRAI thought otherwise.

In the USA, ISPs are required to declare their network management practices and performance characteristics, in addition to there being a restriction on blocking lawful content and unreasonable discrimination. Though this is a step forward, the Federal Communications Commission (the US regulatory body) has left mobile network service providers out of the ambit of its regulations, for unknown reasons.

The EU, or the European Union, now requires ISPs to completely disclose all their practices pertaining to Network Management. The simple principle they followed was that customers should know what they are getting into and therefore, the regime focusses on reducing information asymmetry. Essentially, they the field has been left open for further regulation in the event that anti-competitive practices set in, in the future.

At the moment, only India, Chile, Netherlands and Brazil unequivocally espouse the principles of Net Neutrality in their laws.

Chile, despite having a very low internet penetration of around 28%, has called for an out and out application of Net Neutrality. Further, it has even banned “zero rating”. Zero rating is how successful and financially mighty content providers such as Facebook form an agreement with ISPs to provide their end users with free access (neither the ISP nor the content provider charges a fee) to their websites. Though NN would allow upcoming companies to compete better with established content providers such as Facebook, it also reduces chances of increased internet penetration (which would otherwise have reached its populace free of cost). Though outright imposition of NN laws might seem like a beneficial step, considering Chile’s low internet penetration, I feel it would have been better to start regulating a little later.

Netherlands, on the other hand, has almost 100% internet penetration. In this case, it makes more sense to adopt a neutral internet. Nevertheless, there are other considerations, of a distinct kind, at play over here. Most of the large content providers are based in the US and therefore, it would have put European companies at a disadvantage if NN was not pushed for. Additionally, another disadvantage of furthering NN has been increased tariffs for voice calls.

The Brazilian government has restricted corporations from not only charging deferentially, but also from collecting metadata. Furthermore, corporations are not allowed to do so and can be held accountable even if they store the data abroad. So, companies such as Yahoo and Bing, based in the US, can also be held accountable. However, enforcement concerns have been raised.

CONCLUSION

Over the course of this piece, we have reviewed the various degrees of NN protection afforded by various jurisdictions. We can classify the jurisdictions into 2 categories:

  1. Absolute NN Regime (e.g. India, Chile).
  2. No restrictions with focus on reducing information asymmetry (e.g. EU).

Finally, I would like to direct your attention to www.thisisnetneutrality.org, which provides a beautiful interactive map/infographic that displays NN information for jurisdictions across the world. Apart from categorizing countries into those with NN protections, those considering protection and those with no protections, the infographic provides additional information regarding each individual jurisdiction too.

Chief References:

Refer here, here, here and here.

 

Image from here.

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Huawei v ZTE: SEPs, Injunctions and the Points of Interface between the ECJ Case and Indian Jurisprudence: Part I

Posted on by Tech Law Forum @ NALSAR

[Ed Note: This post is the first part of a two part series authored by Vaibhav Laddha, a student of NALSAR University of Law.]

Technology product markets today are inherently international. Products designed in Germany may be manufactured in Korea or China and sold in India. This cross-cutting global nature of technological products has created a need for standardisation to ensure technical interoperability. Some standards which ensure this are WiFi (wireless networking), MP3 (digital content encoding), 4G (wireless telecommunications), etc. These standards reduce communication costs and increase efficiency. For this reason, various standard setting organisations (SSOs) have been formed who primarily facilitate coordination between different stakeholders in a market by setting standards.

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