BCI Allows Foreign Lawyers and Foreign Law Firms to Practice Law in India

  • March 15, 2023

The Bar Council of India (BCI) has released rules allowing the entry of foreign lawyers and law firms in India. Along with prescribing the eligibility criteria for practicing law in the country, the rules list out the matters which may be handled by foreign lawyers and foreign law firms.

  1. Introduction
  • The BCI has been empowered to list out a Foreign Lawyer’s[2] permitted area of practice, and if required, do so after consulting with the Ministry of Law and Justice of the Government of India. The Rules currently provide that Foreign Lawyers can practice in non-litigious matters (this includes practice on transactional work, corporate work such as joint ventures, mergers and acquisitions, intellectual property rights, drafting of contracts and other related matters, each on a reciprocal basis)[3] and diverse international legal issues. However, Foreign Lawyers will not be allowed to (a) appear before courts, tribunals or other statutory or regulatory authorities; or (b) be involved in any work pertaining to the conveyancing of property, title investigation or similar work.
  • The key principles under the Rules are that (a) Foreign Lawyers that propose to practice law in India are required to obtain prior registration from the BCI under these Rules; and (b) the primary qualification for Foreign Lawyers to apply for registration in India is that they have the ‘right to practice law’ in their foreign country of primary qualification. However, the Rules have one exception where Foreign Lawyers do not need to register with the BCI. This is if Foreign Lawyers practice law on a ‘fly in and fly out basis’ and: (a) provide legal advice to Indian clients on foreign law and on diverse international legal issues, (b) the Indian client procured such advice from a foreign country, (c) the Foreign Lawyer does not maintain an office in India for the purpose of such practice, and (d) such practice in India does not exceed 60 days in any period of 12 months (whether in one visit or multiple visits to India).
  1. Permitted Law Practice by Foreign Lawyers and Foreign Law Firms

The Rules provide the following inclusive list of what constitutes the practice of law in India for a Foreign Lawyer:

  • Foreign Law: doing work, transaction business, giving advice and opinions concerning the laws of the country of their primary qualification (i.e., foreign laws) and on diverse international legal issues – however, such advice cannot include representation or preparation of documents (including petitions, etc.) relating to procedures before an Indian court, tribunal or any other authority which is competent to record evidence on oath;
  • International arbitration conducted in India which may involve foreign law: as regards any international arbitration case conducted in India in which foreign law may or may not be involved, a Foreign Lawyer can provide legal expertise/ advice and appear as a lawyer for a person/ firm/ company/ corporation/ trust/ society, etc. which has an address, head office or principal office in a foreign country (“Foreign Client”);
  • Appearing before bodies that cannot take evidence for foreign law: provide legal expertise/ advice and appear as a lawyer for a Foreign Client in proceedings before bodies in India (which are not courts, tribunals, boards or statutory authorities) which are not legally entitled to take evidence on oath, and which require knowledge of foreign law of the country of the primary qualification of the Foreign Lawyer;
  • Limits on Indian lawyers at Foreign law firms in India: an Advocate registered with an Indian State Bar Council who is a partner or associate at a foreign law firm registered with the BCI under these Rules, will only be permitted to practice non-litigious matters and can only advise on issues relating to countries other than India.
  1. Registration Application and Registration Fee
  • Registration under the Rules is granted for 5 years, and any application for renewal should be submitted to the BCI 6 months before the expiry of the existing license. A Foreign Lawyer’s application (in the prescribed form) is required to be supported by various confirmations, including an NoC from its regulator in the foreign country, an NoC from the Indian Government and confirmations of their practice of law outside India and of no professional misconduct abroad.
  • Successful applicants are required to pay a registration fee equivalent to the enrollment fee in their home foreign country, but the minimum fee should at least be USD 25,000 with a security deposit of USD 15,000 for an individual foreign lawyer (with the renewal fee being USD 10,000), USD 50,000 with a security deposit/ guarantee amount of USD 40,000 for a foreign law firm (whether as a firm, private limited partnership, limited liability partnership, company or otherwise), with the renewal fee being USD 20,000.
  • A key determining factor for such applications is the principle of reciprocity. The BCI has the discretion to refuse registration of a foreign lawyer/law firm if it believes that the number of foreign lawyers/ law firms from a particular foreign country will become disproportionate to the number of Indian lawyers or Indian law firms allowed to practice in a such foreign country, to protect the interest of Indian law firms / Indian lawyers.

[1] Rule 2(vi) defines ‘foreign law’ as a law, which is or was effective, in the country of primary qualification. The latter term is defined under Rule 2(v) as a foreign country in which the foreign lawyer is entitled to practice law as per the law of that country.

[2] Rule 2(iii) defines a ‘foreign lawyer’ as a person, including a law firm, limited liability partnership, company or corporation, by whatever name called or described, who/which is entitled to practice law in a foreign country.

[3] Rule 8(2) of the Rules.

Image Credits:

Photo by Pavel Danilyuk: https://www.pexels.com/photo/professional-lawyer-writing-on-a-notebook-8112113/

The Rules currently provide that Foreign Lawyers can practice in non-litigious matters (this includes practice on transactional work, corporate work such as joint ventures, mergers and acquisitions, intellectual property rights, drafting of contracts and other related matters, each on a reciprocal basis) and diverse international legal issues. However, Foreign Lawyers will not be allowed to (a) appear before courts, tribunals or other statutory or regulatory authorities; or (b) be involved in any work pertaining to the conveyancing of property, title investigation or similar work.

Related Posts

POST A COMMENT

Examining the Constitutionality of the Scheme of Appointing Heirs of Retired Employees

Compassionate appointments are subject to various conditions and are granted as exceptions. Further, the applications for the same have to be filed as per the applicable rules. Time and again, courts have ruled that discrimination in granting compassionate appointments on grounds of marriage, divorce, remarriage, etc. is unconstitutional. In a recent judgment, the Supreme Court has held that appointment of heirs of retiring and/or superannuating employees is violative of Articles 14 and 15 of the Constitution.

 The Central Government and the State Governments have schemes in place providing for compassionate appointments. When a government servant dies while in service (i.e., before retirement) or retires on medical grounds, his or her dependant family member can make an application to the concerned authority to gain employment on compassionate grounds. However, the application has to be filed within the stipulated time and the prescribed eligibility criteria have to be fulfilled before the appointment can be granted. For instance, the government servant’s family should require immediate financial support for reasons such as medical treatment, re-payment of a home loan to avoid dispossession, etc. It is pertinent to note that different states have their own rules and regulations, hence, the criteria, procedure, and other aspects vary from state to state.

Courts across the country including the apex court have made some relevant observations about compassionate appointments in the past while analyzing various facets and allowances under the scheme. The Supreme Court in The State of Maharashtra Vs. Madhuri Maruti Vidhate reiterated that “compassionate appointment is an exception to the general rule of appointment in the public services” and held that a married daughter cannot be held to have been dependent on her deceased mother after assessing the financial situation of her family.

The Allahabad High Court in Smt. Santoshi Vs. State of UP & Ors., held that a widow appointed on compassionate grounds cannot be removed from service on account of her remarriage which is a personal choice and a fundamental right under Article 21 of the Constitution.

The Rajasthan High Court in Smt. Shobha Devi Vs. Jodhpur Vidhyut Vitran Nigam Ltd. & Anr. held that a daughter of a deceased government servant is eligible for compassionate appointment irrespective of whether she is married, single, divorced, or widowed, and discrimination on said grounds is violative of Articles 14, 15, and 16 of the Constitution. The court remarked that “the perception of the daughter, after marriage no longer being a part of her father’s household and becoming an exclusive part of her husband’s household, is an outdated view and mindset”.

And recently, the Supreme Court in Ahmednagar Mahanagar Palika Vs. Ahmednagar Mahanagar Palika Kamgar Union [CA No.5944 of 2022 (2022 SCC OnLine SC 1154)] held that the appointment of heirs of retiring and/or superannuating employees is violative of Articles 14 and 15 of the Constitution. Accordingly, the court set aside the judgment of the Bombay High Court and the award passed by the Industrial Court directing the Ahmednagar Mahanagar Palika to make such appointments.

The division bench of Justice MR Shah and Justice BV Nagarathna observed that such appointments have to be provided after due assessment of various factors including the financial standing of the deceased employee’s family, etc. Also, it was stated that appointments made on compassionate grounds are not “automatic” and are provided only in exceptional circumstances.

The case traces back to the year 1979 when the Union formed by the employees of Ahmednagar Municipal Council raised an industrial dispute regarding the grant of employment to the employees’ legal heirs. Several demands were raised by said Union, one of which pertained to giving appointments to heirs of employees on their retirement. Consequently, it was agreed by the Municipal Council and later, decided by the Industrial Court through an order dated 30th March 1981 that if the employees in the Class-IV category die before retirement, become invalid or retire, then their heirs have to be provided with a compassionate appointment.

Then, the Ahmednagar Municipal Council was reconstituted as the Ahmednagar Mahanagar Palika in 2003, thereby bringing its employees within the ambit of the schemes of the State Government. After the reconstitution, two more complaints were filed by the Union in 2005, seeking employment for heirs of retired employees. Accepting the Union’s contentions, the Industrial Court passed awards dated 16th September 2016 and 21st September 2016 directing the Ahmednagar Mahanagar Palika to comply with its judgment dated 30th March 1981.

Aggrieved by the decision of the Industrial Court, the Municipal Corporation (Mahanagar Palika) filed writ petitions before the Bombay High Court, which were dismissed. Subsequently, appeals were filed before the Supreme Court.

The main issue was whether the heirs of the employees of Ahmednagar Mahanagar Palika were eligible for compassionate appointment upon the employees’ retirement and/or superannuation.

After hearing the parties, the Supreme Court specified that upon due conversion of the Municipal Council into a Municipal Corporation, the award passed by the Industrial Court in 1981, was no longer applicable and the employees of the Municipal Corporation were governed by the scheme framed by the State Government “at par with the government employees”. The respondent’s contentions were dismissed since the State Government’s scheme on compassionate appointments did not include retirement and/or superannuation as grounds for appointing employees’ legal heirs.

Further, it was asserted that such an appointment is contrary to the very object of compassionate appointments and also infringes upon the right to equality guaranteed under Article 14 of the Constitution. The court added that if such appointments were provided, then “those who are the outsiders shall never get an opportunity to get an appointment though they may be more meritorious and/or well educated and/or more qualified.”

Compassionate appointments are provided by the government to ensure that the government servant’s dependant family members do not become destitute. Due to the nature of the appointment, it is subject to certain conditions and is provided as an exception. In a catena of cases, courts have emphasized the importance of considering the financial position of the family to determine the applicant’s eligibility and have also held that discrimination in granting compassionate appointments on grounds of marriage, divorce, remarriage, etc. is unconstitutional. Hence, the applications have to be viewed holistically in deciding whether a compassionate appointment can be granted or not.

Image Credits:

Photo by Sora Shimazaki: https://www.pexels.com/photo/ethnic-businessman-shaking-hand-of-applicant-in-office-5668859/

Compassionate appointments are provided by the government to ensure that the government servant’s dependant family members do not become destitute. Due to the nature of the appointment, it is subject to certain conditions and is provided as an exception. In a catena of cases, courts have emphasized the importance of considering the financial position of the family to determine the applicant’s eligibility and have also held that discrimination in granting compassionate appointments on grounds of marriage, divorce, remarriage, etc. is unconstitutional. Hence, the applications have to be viewed holistically in deciding whether a compassionate appointment can be granted or not.

Related Posts

POST A COMMENT

UGC Releases Draft Regulations Facilitating Entry of Foreign Campuses in India

The UGC has released Draft Regulations that propose a mechanism to facilitate the establishment of foreign campuses in India and lay down the procedure to be followed for the same. 

Introduction

The National Education Policy, 2020 (“NEP”), envisaged the internationalization of higher education in India by allowing foreign universities to set up their campuses in India. In furtherance of the same, the University Grants Commission (“UGC”) issued the draft University Grants Commission (Setting up and Operation of Campuses of Foreign Higher Educational Institutions in India) Regulations, 2023 (“Regulations”). This draft has been formulated to ensure that Indian students get access to the education offered by foreign institutions without having to travel abroad.

Overview of the Draft Regulations

The draft regulations lay down certain criteria to be followed before foreign higher education institutions can set up their campuses in India as per which the foreign higher education institution must:

  • Mandatorily obtain approval from UGC.
  • In the case of foreign universities, be one of the top 500 universities (as per overall or subject-wise global rankings as specified by UGC) or in case of foreign institutions be a reputed institution in its home jurisdiction.

Additionally, the procedure for making an online application on the UGC portal has been provided. As part of the procedure, a non-refundable fee has to be paid and the application should be accompanied by the required information and documents such as the fee structure, courses, resources, information on infrastructure and faculty, etc. This application would be processed by the UGC in 90 days and the manner in which the applications are processed is two-fold:

  • The guidelines require the UGC to set up a standing committee that must process each application on merits which entails checking the credibility of the institution, the impact that the institution would have in creating opportunities in India, etc. The recommendations need to be made by the standing committee within 45 days from the day the application is received.
  • After receiving the standing committee’s recommendations, the UGC must, if approved, issue a notification with (or without) conditions for the institution to operate in India within 45 days of receiving the said recommendation.

The approval granted by the UGC is valid for 10 years and has to be renewed one year before its expiry. The institution would have to apply for a renewal in the ninth year and the UGC may then grant renewal for the next 10 years. Further, a certain level of autonomy is proposed to be granted to foreign higher educational institutions in the following matters:

  • Making decisions regarding the fee structure.
  • Control over the admission process and criteria.
  • Formulating the norms for recruiting faculty from abroad or India including their qualifications and remuneration.

Some of the requirements prescribed by the draft, to be complied with by a foreign higher educational institution for setting up a campus in India are as follows:

  • The prospectus including details such as the number of seats offered in a program, fee structure, refund policy, and eligibility criteria has to be published on its website, 60 days in advance from the day on which the admissions are due to start.
  • Fee structure has to be transparent and reasonable.
  • The qualifications of the institution’s faculty should meet the standards of the main campus (situated in the institution’s country of origin).
  • The foreign faculty should stay in India for a reasonable period.
  • A student grievance redressal mechanism has to be set up.
  • The quality of education must be at par with that offered on the main campus.
  • The qualifications conferred on students at the Indian campus must be treated on the same level as the corresponding qualifications obtained at the main campus.
  • Adequate physical infrastructure should be arranged for.
  • It has to be ensured that the operations of the institution don’t compromise the integrity and sovereignty of India.
  • It has to go through a quality assurance audit and submit the report when required.
  • An annual report must be submitted to the UGC.
  • The provisions of the Foreign Exchange Management Act (FEMA), 1999 have to be duly complied with.

The UGC has been empowered under the Regulations to impose a penalty and/or suspend/withdraw approval in the following circumstances – a) The campus of the foreign higher educational institution has failed to adhere to or has violated the Regulations; b) Its activities or academic programmes are against the interests of the country; c) It has failed to abide by the undertaking given at the time of application; d) It engages in operation (s) other than the one (s) permitted under the Regulations; and d) In case of any adverse finding, misappropriation and suppression of facts.

Conclusion

Education not only plays a crucial role in the development of a human being but also helps in the advancement of the nation. Over the past few years, the government and regulatory bodies have introduced numerous measures to strengthen the education sector. The UGC, in an attempt to ensure that Indian students get an opportunity to receive an affordable international degree and to help make India a “global study destination”, unveiled the draft Regulations. It remains to be seen whether the  Regulations serve the needs of and are suitable for Indian students considering that Indians choose to study abroad for a multitude of reasons not contemplated in the draft regulations.

Image Credits:

Photo by Keira Burton: https://www.pexels.com/photo/cheerful-multiethnic-students-with-laptop-and-copybook-studying-on-grassy-lawn-6146983/

Education not only plays a crucial role in the development of a human being but also helps in the advancement of the nation. Over the past few years, the government and regulatory bodies have introduced numerous measures to strengthen the education sector. The UGC, in an attempt to ensure that Indian students get an opportunity to receive an affordable international degree and to help make India a “global study destination”, unveiled the draft Regulations. It remains to be seen whether the  Regulations serve the needs of and are suitable for Indian students considering that Indians choose to study abroad for a multitude of reasons not contemplated in the draft regulations.

Related Posts

POST A COMMENT

An Analysis of the Regulation of Children's Online Activities Under the Digital Personal Data Protection Bill, 2022

The DPDP Bill was tabled by the Ministry of Electronics and Information Technology on November 18, 2022, for comments. The purpose of the Bill was to provide for the processing of digital personal data in a manner that recognized both the right of individuals to protect their personal data and the need to process personal data for lawful purposes. Though the object behind the proposed DPDP Bill appears to justify the need of the hour, the DPDP Bill has imposed certain additional obligations with respect to children.

Introduction

The internet has become an indispensable part of modern life. The significance it bears and the impact it has on young minds cannot be overstated. It provides them with access to a vast array of information and resources, including educational content, news, and entertainment. It also allows them to connect with others and form communities, whether it be through social media, gaming, or online forums. The use of the internet in day-to-day affairs of life has considerably grown over the past two decades. The leitmotif of this article is not to regurgitate the importance of the internet but to reflect on the intriguing debate over the regulation of the internet by parents with respect to children under the proposed Digital Personal Data Protection (“DPDP”) Bill, 2022.

The Gordian Knot

Section 10[1] of the proposed DPDP Bill deals with the processing of the personal data of children. The section states that ‘The Data Fiduciary shall, before processing any personal data of a child, obtain verifiable parental consent in such manner as may be prescribed’. Under the Bill, a child is defined as someone who has not completed eighteen years of age[2]. Every time a child creates an account, be it social media, gaming, or an OTT account, the Data Fiduciary[3] involved, which would be the platform providing the service, would necessarily have to secure the consent of the parent or legal guardian of the child before processing their data. The DPDP Bill also prescribes a penalty of up to Rs. 200 crores for its non-compliance[4].

The implications of this proposed section are vast. Currently, most social media platforms including Twitter, Facebook, and Instagram require the user to be above the age of thirteen years to create an account, without any requirement of parental consent. Practically speaking, these platforms do not verify the age as claimed by the user and thus, it is possible to provide incorrect age in order to create an account. The same goes for all other prospective Data Fiduciaries. From knowledge-providing platforms like YouTube and Quora to entertainment or gaming platforms like Spotify and Stream, all these platforms currently have set thirteen years as the minimum age to create an account and enjoy these services. To comply with the DPDP bill, in case it is passed, the platforms would not just have to modify their own terms and conditions for the Indian jurisdiction but also have to come up with a verifiable parental consent requirement mechanism. Since most platforms and websites on the internet require the creation of an account to access the features or services fully, enforcing Section 10 of the DPDP bill would require an entire overhaul of how the internet functions. There would have to be parental consent forms and verification mechanisms in almost all corners of the internet.

While mandating such monitoring of every online activity of a child might sound fit in an average conservative Indian household, it is important to understand that doing so fundamentally alters the very forte of the internet – accessibility to information. Curtailing this would have detrimental effects on any child’s development, by allowing the parents to restrict any chances of the child’s exposure to perspectives that might not agree with their own. This would also be in defiance of Article 13 of the Convention on the Rights of the Child[5], which India had signed and ratified on December 11, 1992. The Article promotes the “right to freedom of expression; this right shall include freedom to seek, receive and impart information and ideas of all kinds, regardless of frontiers” for children.

Untying the Knot

Perhaps one way to mitigate the issues that could arise if the proposed section is brought into effect is by introducing gradation in the age limit that it specifies consent for. In this respect, inspiration can be taken from the Indian Penal Code, 1860,[6] which categorizes children and provides for classification based on age (below 7, from 7 to 12, etc.) to determine the law applicable to them. Even the much popular General Data Protection Regulation, 2016 of the European Union allows member states to lower the age of the child to 13 years to determine if parental consent would be needed or not[7].

The rigidity with respect to parental consent should also be based on a model which considers the evolution and development of children at different ages. France’s model of children’s data privacy rights under the French Data Protection Act, 1978 which was heavily amended recently in 2018, could also be looked at. Article 45 of the said Act[8] introduces the concept of “Joint Consent”. It states that ‘If the child is under 15 years of age, the processing will be lawful only if consent is given jointly by the child and the holder(s) of parental responsibility over that child.’ This, in essence, means that the consent is based on a mutual agreement between the child and the parent(s) holding parental rights. With respect to children above the age of 15 years, the Act allows them to give their own consent.

Conclusion

Thus, while it is ultimately up to the lawmakers to resolve, they must keep in mind the logistical and sociological effects of enforcing mandatory parental regulation on children’s online activities. If not by reducing the age to a more reasonable one, as done by other jurisdictions, systems like gradation in age or joint parental-child consent should be put in place. In the case of Faheema Shirin R.K. vs State of Kerala[9], the Kerala High Court, specifically speaking in the context of students, stated that the right to access the internet forms a part of freedom of speech and expression guaranteed under Article 19(1)(a) of the Constitution. In the said case, it was held that ‘Enforcement of discipline shall not be by blocking the ways and means of the students to acquire knowledge’. The concept of “best interest of the child” which is much popular in custody and guardianship cases and puts the best possible alternative for the child before the rights of the parents, could perhaps be interpreted broadly and acknowledged by the lawmakers with respect to the present debate as well.

References:

[1] Section 10, The Digital Personal Data Protection Bill, 2022.

[2] Defined under Section 2(3), The Digital Personal Data Protection Bill, 2022.

[3] Defined under Section 2(5), The Digital Personal Data Protection Bill, 2022.

[4] Section 25, The Digital Personal Data Protection Bill, 2022.

[5] Article 14, Convention on the Rights of the Child, 1989 [General Assembly resolution 44/25].

[6] Sections 82 and 83, Indian Penal Code, 1860.

[7] Article 8, General Data Protection Regulation, 2016.

[8] Article 45, French Data Protection Act, 1978.

[9] Faheema Shirin R.K vs State of Kerala, 2019 [WP(C)No.19716 OF 2019(L)].

Image Credits:

Photo by Pavel Danilyuk: https://www.pexels.com/photo/woman-using-a-laptop-with-her-daughter-7055153/

While it is ultimately up to the lawmakers to resolve, they must keep in mind the logistical and sociological effects of enforcing mandatory parental regulation on children’s online activities. If not by reducing the age to a more reasonable one, as done by other jurisdictions, systems like gradation in age or joint parental-child consent should be put in place.

Related Posts

POST A COMMENT

Registration of GUI as Designs: Existing Provisions and Challenges

  • January 13, 2023
  • Drishti Kardam

In this article, an attempt is being made to highlight how GUIs can be protected and to ascertain the challenges faced by applicants in filing design applications for the registration of GUIs.

Introduction

A Graphic User Interface (GUI) which allows users to interact with electronic devices or machines, is widely used in the present digital age. The term was coined in the 1970s to distinguish graphical interfaces from text-based ones, such as command line interfaces (CLI), etc. Apple’s GUI-based operating system – Macintosh, Microsoft’s Windows, Mobile Touch Screens, and other 3D interfaces (Eg. Augmented Reality) are all examples of GUIs.

Protection of GUI: A Look at Locarno Classification and Designs (Amendment) Rules, 2021

Just as trademarks are classified into various classes of goods and services provided for in the internationally accepted NICE classification, Designs also have a classification of articles to which a design can be applied, known as the Locarno Classification.

The Locarno Classification, developed under the Locarno Agreement (1968), is an international classification used for registering industrial designs. India became the 57th member to be a signatory to the Locarno agreement in 2019. The changes were incorporated through the Designs (Amendment) Rules, 2021, thereby bringing the classification of industrial designs at par with the rest of the world as opposed to the previous national classification.

Subsequently, on 25th January 2021, the Ministry of Commerce and Industry notified the Designs (Amendment) Rules, 2021, which substituted Rule 10 of the Design Rules 2001, and incorporated the current edition of the Locarno Classification, which specifically created Class 14 – Recording, telecommunication, or data processing equipment, with a subclass “Class 14-04 – Screen Displays and Icons”, and further provided for Class 32, allowing for two-dimensional graphic designs, graphic symbols, and logos, to be protected under the Designs Act, 2000, provided that these designs satisfy the essentials of an ‘Article’ and a ‘Design’ as defined in Sections 2(a) and 2(d) of the Act.

Lacunae in Legislation

As per the Designs Act, 2000, a design means “only the features of shape, configuration, pattern, ornament, or composition of lines or colours applied to any article, whether in two dimensional or three dimensional or in both forms, by any industrial process or means, whether manual, mechanical or chemical, separate, or combined, …”

Now, this is precisely where the problem arises. Even after the Locarno Classification was introduced and the Designs Rules were amended to deal with confusion and uncertainties in the classification of industrial designs, the lawmakers have failed to amend the definition of ‘Design’ and bring the Designs Act, 2000, along the same lines. Further, the Controllers make conflicting observations and the interpretations provided by them seem to lack uniformity.

A GUI should be protected since its intrinsic purpose is to enhance the visual appeal of the program and thus build on its commercial value. The definition of a design given under the Act is limited and does not expressly provide for graphics and/or software. Due to this lacuna, the definition is open to multiple interpretations.

Practice Followed by the Indian Design Office

Before 2009, Microsoft was granted registration for some of its designs under Class 14-99, in the ‘Miscellaneous’ category. Thereafter, in the year 2014, Amazon filed a design application under no. 240305 pertaining to a “Graphic user interface for providing supplemental information of a digital work to a display screen”, which was rejected by the Design Office, on the grounds that GUIs do not qualify as designs under Section 2(d) of the Act, they lacked “consistent eye appeal” and were not physically accessible.

Over the years, several new applications for the registration of GUIs have been filed. While a few have been granted[1], most Examiners opine that the GUIs do not fall under the definition of ‘designs’ and hence, cannot be protected. Hence, applicants are wary of filing design applications for registration of GUIs due to the absence of robust precedents.

Observations made by US Courts

In Ex Parte Tayama[2], the Court made the following observations –

  1. Programmed Computer Systems would suffice to be termed as an article of manufacture.
  2. Design (GUI) is an integral part of computer programmes.

Further, the patent battle[3] between Apple and Samsung (2011 – 2018) ended with Apple being awarded $539 million for Samsung’s infringement of its initial design. Apple was all the while contending to protect its “Total User Experience”.

Various Design Patents have been granted by USTPO, such as apparatus for displaying the path of a computer program error as a sequence of hypertext documents in a computer system having display[4], device, method, and graphical user interface for adjusting content selection[5], etc.

European Union’s Position

EU also provides wide protection to designs under EU Directive 98/71/EC on Legal Protection of Designs. GUIs in the EU are generally registered under the Community Design Regulation (Council Regulation No. 6/2002/EC) but may also exist as unregistered Community Designs. The regulation, however, excludes computer programmes.

Conclusion

The current definition of a design is inadequate and does not expressly cover the aspects of graphics/GUIs. Undoubtedly, the various developments in the IT industry have made the world realize the importance of protecting graphics. However, the introducing of international classification (Locarno Classification) and bringing amendments to existing laws are not sufficient. It is imperative to establish new guidelines and provide appropriate training to the Examiners at the Design Office so that a uniform mechanism is in place to facilitate the registration of graphic symbols/GUIs.

References:

[1] Design Application Numbers 274917, 274918, 284680, 276736, 260403

[2] 24 U.S.P.Q.2d (BNA) 1614 (BPAI Apr. 2, 1992)

[3] Apple, Inc. v. Samsung Elecs. Co., 926 F. Supp. 2d 1100 (N.D. Cal. 2013) (partially affirming jury damages award).

[4] US6763497B1

[5] US10915243B2

Image Credits:

Photo by cottonbro studio: https://www.pexels.com/photo/person-using-macbook-3584994/

A GUI should be protected since its intrinsic purpose is to enhance the visual appeal of the program and thus build on its commercial value. The definition of a design given under the Act is limited and does not expressly provide for graphics and/or software. Due to this lacuna, the definition is open to multiple interpretations.

Related Posts

POST A COMMENT

Regulating Online Gaming Intermediaries - The Rules and their Implications

  • January 11, 2023
  • Padma Sinha
  • Ojasvi Agarwal

The Ministry of Electronics and Information Technology (MeitY) has released the draft Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Amendment Rules to bring online gaming intermediaries within the ambit of the IT Rules, 2021.

Background

Online gaming is one of the fastest-growing industries in India with the number of gamers expected to increase by 30 million from 2022 to 2023[1]. Following the increase in the number of users, it has become imperative that appropriate laws are introduced to regularize the online gaming industry. On January 02, 2023, the Ministry of Electronics and Information Technology (“MeitY”) proposed an amendment to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (“IT Rules”). The IT Rules, in its current structure, provide regulation for social media intermediaries and significant social media intermediaries. The Draft[2] “Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Amendment Rules” (the “Draft”), which is open for consultation from the public, proposes to extend its ambit to ‘online gaming intermediaries’ forming a part of Part II (that relates to other intermediaries).

The Draft defines “online gaming intermediaries” and “online games” but lacks to provide a clear distinction between “games of chance” and “games of skill”, which has been a sticky issue over the years. The Draft further proposes (inter alia) the following changes –

  • All online games would be required to be registered with a ministry-approved self-regulated body by creating a self-regulatory framework, to be registered with MeitY. The self-regulatory body will be responsible for reviewing and registering the online games offered by its members, subject to certain prescribed factors. Games approved by the self-regulatory body may be offered with a visible mark signifying their registration.
  • The proposed rules also mention certain compliances that need to be made by the social media firms such as checking the registration of the online gaming intermediary and consulting the self-regulatory officer before allowing any advertisement on their platform.
  • The online gaming intermediary shall comply with the requirement of due diligence and shall additionally ensure they do not host any online game that does not conform with Indian laws and shall make additional disclosures to the users including the refund and withdrawal policy, financial risks, and other risks associated with gaming, measures that are in place to ensure the safeguarding of deposits, etc.
  • In addition to the above, a new set of due diligence requires compliance with mandatory know-your-customer(KYC) norms for user verification as per Reserve Bank of India norms.
  • Similar to the requirement for social media intermediaries, requirements of appointment of a resident ‘compliance officer’ and ‘grievance officer’ have been mandated along with ‘nodal officers’ for round-the-clock coordination with law enforcement agencies and officers.
  • The online gaming intermediaries need to have a physical address in India and the same is required to be published on their website.

Purpose of the Draft

The purpose of the Draft, if it becomes the law, is to protect the interests of different stakeholders, ensure the safety of players and encourage responsible gaming.  The Draft is also put together to bring about uniformity of laws that online gaming intermediaries may be required to follow by reducing the burden of following state-specific gaming measures making it, not just easier for online gaming intermediaries to comply with the law, but also helps the enforcement agencies since it becomes difficult for the governments of different states to ensure geographical checks are in place. According to the ministry, the final amendments to the IT rules would be notified by April 2023.

Discussions & Implications

While the Draft seems to have been aiming at shaping a burgeoning gaming industry, the concerns around the Draft seem to be supplementing the already existing questions on the existing IT Rules.

At the outset, the question of whether ‘online gaming’ should remain a subject of the ‘States’ (as betting and gambling have traditionally been) or the ‘Centre’, remains unresolved. MeitY had earlier, in affidavits before the High Courts, consistently stated that is not within its purview and power to legislate on the subject and that rests solely on the states. Therefore, the introduction of the Draft without consultation and consensus amongst states seems not quite in line.

The ambiguity further extends to a lack of clarity on whether the Draft bans ‘gambling’. While IT Minister, Rajeev Chandrasekhar stated that “online games that allow wagering on the outcome are effectively a no-go area” there is no clear prohibition on ‘gambling’. The Rules only state, as a part of due diligence, online gaming intermediaries shall make reasonable efforts to ensure that online gaming platforms do not contravene any gambling or betting laws in India, which again differs from state to state.

An online game has been defined in the Draft as a “game that is offered on the Internet and is accessible by a user through a computer resource if he makes a deposit (in cash or in-kind) with the expectation of earning winnings”- In the absence of a definition of “gambling” and “betting” in the Draft and clarity on which category of games are sought to be regulated if the online game for consideration is sought to be regulated on one hand and gambling or betting content is prohibited on the other hand, remains a question[3]. While it may be assumed that the ‘kind’ component in the definition has been introduced to cover ‘non-monetary token’ or ‘online gaming currencies’, it may lead to the consequence where games that do not require any monetary incentive may also be included within the meaning of online games here. The definition can almost broadly cover all ‘gambling games’ within the purview of ‘makes a deposit (in cash or in-kind) with the expectation of earning winnings’. Would that mean that ‘gambling’ is brought within the purview of these Rules?

The Draft classifies online gaming platforms as ‘intermediaries’. Our understanding of the term ‘intermediary’ includes one that acts on behalf of another entity. However, in the case of online gaming platforms, we notice that most of them publish the gaming content themselves and do not host games on behalf of another. In view of the above, in an earlier debate, a government task force submitted a study stating that gaming platforms should be categorized as ‘publishers’ and not as ‘intermediaries’[4]. The question that remains unanswered is why we now bring online platforms within the purview of intermediaries thereby giving them passage to ‘safe harbour protection’ under Section 79 of the IT Act.

Apart from the few above-mentioned points, the Draft may expect push-back from various industry stakeholders on the Government’s over-arching power on issues of revocation of registration of self-regulatory bodies and exercising regulatory power for KYC. It is to be observed therefore how MeitY resolves the already existing issues on the IT Rules pending before the courts and accordingly brings about an amendment to the current online gaming Draft Rules catering to the purpose it mentioned in its notes[5] accompanying the Draft Rules.

References:

[1] https://www.indiatimes.com/explainers/news/how-rapidly-is-the-gaming-industry-growing-in-india-589059.html

[2]https://www.meity.gov.in/writereaddata/files/Draft%20notification%20for%20amendment%20to%20IT%20Rules%202021%20for%20Online%20Gaming.pdf

[3] https://g2g.news/online-gaming-laws/draft-online-gaming-rules-have-contradictory-provisions-ambiguity-can-still-continue/

[4] https://www.hindustantimes.com/india-news/govt-task-force-restarts-debate-on-status-of-online-gaming-platforms-101666896702910.html

[5] https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1888143

Image Credits:

Photo by Yan Krukau: https://www.pexels.com/photo/gaming-chairs-and-computers-9072216/

An online game has been defined in the Draft as a “game that is offered on the Internet and is accessible by a user through a computer resource if he makes a deposit (in cash or in-kind) with the expectation of earning winnings”- In the absence of a definition of “gambling” and “betting” in the Draft and clarity on which category of games are sought to be regulated if the online game for consideration is sought to be regulated on one hand and gambling or betting content is prohibited on the other hand, remains a question.

Related Posts

POST A COMMENT

Foreign Funding: Guide to FCRA Regulations

The Foreign Contribution (Regulation) Act (“the Act” or “FCRA”) was first enacted in the year 1976 to regulate the utilisation of foreign contributions or hospitality to maintain strict control over voluntary organisations and political associations that received foreign funding. The Act aims to prevent foreign organisations from influencing electoral politics, social, political, economic, or religious discussions in India for wrong purposes and activities detrimental to the public interest. The Act falls under the purview of the Ministry of Home Affairs (MHA) since it is a law relating to internal security and not under the Reserve Bank of India (RBI) despite it being a financial legislation.

In 1984, an amendment was made to the Act requiring all non-governmental organisations to register themselves with the MHA. In 2010, the Act was repealed, and a new Act was enacted with stricter provisions. The Act was further amended in the year 2020 by the Foreign Contribution (Regulation) Amendment Act, 2020 (“FCRA Amendment Act”).

The FCRA is applicable to the whole of India and its citizens outside India and to the associated branches or subsidiaries outside India of companies or bodies corporate, registered or incorporated in India.

 

Prohibition on Accepting Foreign Contributions

The FCRA prohibits the following persons from accepting any foreign contributions:

  1. Candidate for election;
  2. Correspondent, columnist, cartoonist, editor, owner, printer or publisher of a registered newspaper;
  3. Public servant, Judge, Government servant or employee of any entity controlled or owned by the Government;
  4. Member of any Legislature;
  5. A political party or office bearers thereof;
  6. Organisations of a political nature as may be prescribed;
  7. Associations or companies engaged in the production or broadcast of audio news or audio-visual news or current affairs programmes, through any electronic mode or form, or any other mode of mass communication;
  8. Correspondent or columnist, cartoonist, editor, owner of the association or company referred to in (g) above.

However, the above-mentioned persons can accept foreign contributions in the following situations:

  1. from their relatives;
  2. by way of salary, wages or other remuneration in the ordinary course of business;
  3. by way of a gift as a member of any Indian delegation, provided the gift was accepted in accordance with relevant rules made by the Central Government in this regard;
  4. by way of any scholarship, stipend or any payment of like nature;
  5. by way of remittance received in the ordinary course of business.

 

Meaning of Foreign Contributions

‘Foreign Contribution’ means the donation, delivery or transfer made by any foreign source of any:

  1. article (not being an article given to a person as a gift for his/her personal use, the market value of which is not more than one lakh rupees);
  2. currency (whether Indian or foreign);
  3. security. 

Contributions made by a citizen of India living in another country (e.g. a Non-Resident Indian (NRI)) from his/her personal savings, through the normal banking channels, will not be treated as foreign contributions. However, it is advisable to obtain the passport details of such an NRI to ascertain that he/she is actually an Indian citizen.

Donations from an Indian-origin person who has acquired foreign citizenship will be treated as a foreign contribution. This will also apply to Person of Indian Origin [PIO]/ Overseas Citizen of India [OCI] cardholders as they are foreigners.

Foreign remittance received from a relative shall not be treated as a foreign contribution. However, any person receiving a foreign contribution in excess of ten lakh rupees or equivalent thereto in a financial year from any of his/her relatives is required to inform the Central Government on Form FC-1 within thirty days from the date of receipt of such contribution.

 

Who can Receive Foreign Contributions?

Any person* can receive foreign contribution provided:

  1. The person has a definite cultural, economic, educational, religious, or social programme;
  2. The person must have obtained FCRA registration/prior permission from the Central Government; and
  3. The person must not be a prohibited person under Section 3 of the FCRA (Persons prohibited are already discussed above).

*Person includes –

  • an individual;
  • a Hindu Undivided Family;
  • an association;
  • a company registered under Section 8 of Companies Act, 2013 (earlier Section 25 of Companies Act, 1956).

There is a prohibition on the transfer of foreign contributions to any other person.

The foreign contribution received has to be utilised only for the purpose for which it has been received and not more than 20% of the foreign contribution received in a financial year can be utilised to defray administrative expenses.

 

Registration/Prior Permission under FCRA

Section 11 of FCRA mandates that unless a person having a definite cultural, economic, educational, religious or social program obtains a certificate of registration [COR] or prior permission from the Central Government, such person cannot accept any foreign contribution.

This means that a person should either obtain a COR or obtain prior permission before accepting any foreign contribution.

 

Eligibility to Obtain Registration 

For grant of registration under FCRA, the association should:

  • be registered either under the Societies Registration Act, 1860 [SRA] or the Indian Trusts Act, 1882 [ITA] or under section 8 of the Companies Act, 2013 [Co. Act] etc,
  • has undertaken reasonable activities in its chosen field for the benefit of society, for which the foreign contribution is proposed to be utilised;
  • normally be in existence for at least three years and has spent a minimum of INR 15 lakhs (excluding administrative expenditure) on its core activities for the benefit of society during the last three financial years;
  • submit audited statement of accounts and activity report for the last three years.

 

COR: Form of Application and Period of Validity

  • An application for COR has to be filed electronically on Form FC-3A.
  • COR is ordinally granted within ninety days from the date of receipt of the application.
  • COR is valid for a period of five years and can be renewed within six months of its expiry.

 

Eligibility for Grant of Prior Permission

An association in its formative stages would not be eligible for COR. Such an association can apply for a grant of prior permission, which may be granted for the receipt of a specific amount from a specific donor, for the carrying out of specific activities/projects.

For this purpose, the association should:

  • be registered under the SRA or the ITA or Section 8 of the Co. Act, etc.;
  • submit a specific commitment letter from the donor indicating the amount of foreign contribution and the purpose for which it is proposed to be given; and
  • have prepared a reasonable project for the benefit of the society for which the foreign contribution is proposed to be utilised.

 

Form of Application and Period of Validity of the Grant of Prior Permission 

  • An application for the grant of PP must be filed electronically in Form FC-3B.
  • Grant of PP is ordinally be granted within ninety days from the date of receipt of application.
  • Its validity shall expire once the foreign contribution is fully utilized, for which the PP was/is granted.

 

Opening an FCRA Account

Every person who makes an application for the grant of COR or PP shall be required to open an ”FCRA Account” in a designated bank account with State Bank of India, – Main Branch, New Delhi [the designated FC account].

 

Conditions for Obtaining a Registration/Grant of PP

The applicant:

  1. should not be fictitious or benami;
  2. should not have been prosecuted or convicted for indulging in activities aimed at conversion through inducement or force, either directly or indirectly, from one religious faith to another;
  3. should not have been prosecuted for or convicted of creating communal tension or disharmony;
  4. should not have been found guilty of diversion or misutilization of funds;
  5. should not be engaged or likely to be engaged in the propagation of sedition or advocate violent methods to achieve its ends;
  6. should/is not likely to use the foreign contribution for personal gains or divert it for undesirable purposes;
  7. should/has not contravened any of the provisions of the FCRA;
  8. should/has not been prohibited from accepting foreign contributions.

 

Maintenance of Accounts

  • Every person who has been granted a COR or given a PP is required to maintain a separate set of accounts and records exclusively for the foreign contribution received and submit an annual return, duly certified by a CA, giving details of the receipt and purpose-wise utilisation of the foreign contribution.
  • The annual return is to be filed for every financial year within a period of nine months from the end of the year i.e., by 31st December each year. It is mandatory to submit a ‘Nil’ return even if there is no receipt/utilization of foreign contribution during the year.
  • The annual return is to be submitted online on Form FC-4, duly accompanied by the balance sheet and statement of receipt and payment, which is certified by a CA.
  • The annual return must be filed on a yearly basis, till the amount of foreign contribution is fully utilised.

 

Recent Update: Noel Harper v. Union of India

The Hon’ble Supreme Court has, in the case of Noel Harper v. Union of India[1] upheld the constitutional validity of the Foreign Contribution (Regulation) Amendment Act, 2020 which had placed restrictions on the way foreign contributions are raised and used by organisations in India. It held that the amendments were intended to remedy the mischief of an endless chain of transfers of the foreign contributions that create a layered trail of money making it difficult to trace the flow and legitimate utilisation thereof. Further, the Hon’ble Delhi High Court in the case of Advantages India[2] had also held that provisions of FCRA do not violate Articles 14 and 21 of the constitution and are not arbitrary, unreasonable and ultra vires.

 

Concluding views

FCRA is an internal security law aimed at ensuring that foreign contributions/organisations do not affect the sovereignty of India and its public interest. The provisions under FCRA are quite strict and it is seen that the government is proactively monitoring the compliance relating to the acceptance and use of foreign contributions. It is therefore important for organisations covered under FCRA to follow the law in its true letter and spirit.

References: 

[1] Writ Petition (Civil) Nos. 566, 634 And 751 Of 2021

[2] Writ Petition (Crl) Nos. 3595 Of 2017

 

 

Image Credits: Photo by Nehal Patel on Unsplash

FCRA is an internal security law aimed at ensuring that foreign contributions / organisations do not affect the sovereignty of India and its public interest. The provisions under FCRA are quite strict and it is seen that the Government is proactively monitoring the compliances relating to the acceptance and use of foreign contributions.

Related Posts

POST A COMMENT

The DESH Bill 2022 has the Potential to Change Our “Desh”

After India enacted the Special Economic Zones (SEZ) Act in 2005 and the rules governing SEZs came into effect in 2006, about 378 SEZs were notified. However, as of March 2022, only 268 of these were operational; the government has de-notified those SEZs that were not functional. In her last budget speech, Finance Minister Nirmala Sitharaman announced the government’s intention to revise the legislative architecture relating to SEZs. She cited lack of demand as a reason and also the fact that significant changes to taxation and incentive regimes in the past decade have made the existing notion of SEZs much less attractive. Further, a couple of years ago, the WTO ruled that the tax-related incentives given to SEZs violated global agreements on subsidies.

The Context of the DESH Bill 2022

 

The biggest reason why India’s SEZ regime needs a relook is because the business environment has changed substantially in recent years. The SEZ regime was originally intended to promote exports so that we could earn valuable foreign exchange. The existing SEZ regime has undoubtedly benefited the Indian IT industry, and this has contributed hugely to building our foreign currency reserves. However, with IT/ITES company business and delivery models changing to include greater on-site delivery capabilities, the sheen has worn off. Also, the manufacturing sector has not been able to leverage SEZs to deliver as much export-based economic benefit as was expected. Change was therefore needed, and this is why the government has been planning a thorough revamp of the existing SEZ system.

 

This is the Right Time for Change

With a number of disruptive events accelerating global shifts in supply chains, investment-intensive manufacturing capabilities in new sectors are becoming critical for India. It is also important to boost trading and other services beyond IT. It has become even more important to look at new ways of attracting capital to complement our demographic strengths. Also, rather than continue to cluster economic activity in certain urban areas, what India needs is more broad-based activity across various states. Only strategies that enable all this will accelerate job creation and hence socio-economic growth and development in India.

This is the context in which the government of India plans to introduce the Development of Enterprise and Service Hubs (DESH) Bill in the ongoing monsoon session of Parliament.

 

Broad Contours of the DESH Bill 2022

The DESH Bill seeks to encourage the creation of two types of hubs: one for services and the second for other enterprises. The former will have requirements for built-up areas and allow a broad range of services-related activities (including R&D), while the latter (which can house manufacturing and/or services), will have land-based area requirements. Both types of hubs can be created by the government (Centre/States), jointly, or by any registered goods and services provider. The idea is to encourage private sector investments to serve the domestic market and not just exports. The expectation is that greenfield or brownfield projects will encourage the creation of infrastructure in non-urban areas.

The Bill proposes to simplify ease of doing business by enabling single window clearances (both central and state). The bill will also make the hubs WTO compliant (tax incentives will be delinked from exports). However, some indirect tax benefits are expected to be provided. It is also likely that businesses operating from these hubs will be allowed to utilize idle capacity to service domestic customers (unlike SEZs that could only export).

What is known about the DESH Bill 2022 so far indicates that the central government is keen to use it as an instrument to activate three key levers of economic growth:

  • Creating infrastructure of the scale needed to become a global manufacturing and services hub – especially as western countries are looking at alternatives to China and other countries (even smaller ASEAN nations and some in Latin America and Africa) are positioning themselves as viable destinations at least in niche sectors. (Some of China’s hubs are more than 250 sq km in area, while Indian SEZs are hardly ever more than 2.5 sq km. Chinese hubs are fully integrated towns with well-developed infrastructure and linkages to ports, airports etc. This explains the huge difference in scale between Chinese hubs and those anywhere else in the world – a gap that India is keen to bridge).
  • Leveraging India’s scientific/technical talent to innovate and leapfrog competition in areas that will become key not just for self-reliance (e.g., pharma, energy, electronics etc.) but also critical to our security (e.g., drones, space technology, composite materials, semiconductor chips etc.)
  • Fostering better cooperation and greater alignment between central and state governments (and inter se) so that outcomes such as employment generation and optimal resource utilization are not sacrificed on the altar of petty political differences or short-term gains.

Let’s hope the DESH Act will achieve all that it seeks to, and not become just another legislation that did not deliver to its potential.

*”Desh” is the Hindi word for “country”. It is interesting that many acronyms coined by the government are easy to remember because they mean something related in Hindi.

Image Credits: Photo by Jesper Giortz-Behrens on Unsplash

The Bill proposes to simplify ease of business by enabling single window clearances (both central and state). The Bill will also make the hubs WTO compliant (tax incentives will be delinked from exports). However, some indirect tax benefits are expected to be provided. It is also likely that businesses operating from these hubs will be allowed to utilize idle capacity to service domestic customers (unlike SEZs that could only export).

Related Posts

POST A COMMENT

Starting a Print Newspaper in India: A Guide

The primary statute that governs and regulates the publication of books, newspapers and magazines is the Press and Registration of Books Act, 1867. In addition, the Newspaper (price and Page) Act, 1956 regulates, governs and endeavors to prevent unfair competition among newspapers so that newspapers generally and in particular, newspapers with smaller resources and those published in Indian languages, may have fuller opportunities of freedom of expression.

The term “newspaper” is defined in the Newspaper (Price and Page) Act, 1956[1] as any published periodical work containing public news or remarks on public news appearing at intervals of not greater than a week. The main function of the Ministry of Information and Broadcasting is to control the office of the Registrar of Newspapers for India (“RNI”) and frame the rules under the Press and Registration of Books Act, 1867. Therefore, anybody who is inclined to start a newspaper, magazine or journals, will have to seek prior approval from RNI. Headquartered in New Delhi, the regional branches of RNI are in Mumbai, Kolkata and Chennai.

The RNI is entrusted with assembling and maintaining a Register of Newspapers; issuing Certificates of Registration to the newspapers (“RNI Registration”); Verifying claims; and various non-statutory functions and rules.

 

RNI Registration

 

 

                                                                    Photo: Who requires RNI Registration [2]

 

Steps to Obtain an RNI Registration 

 

Title Verification