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What’s brewing for online publishers of content?

Ranjana Adhikari, Shashi Shekhar Misra & Akhil Bhardwaj

Ranjana Adhikari            Shashi Shekhar Misra

Indian regulators are extending their reach to digital content creators and publishers. A new set of rules, now applicable to digital media firms (including foreign and domestic OTT platforms), could lead to significant costs and compliances for publishers making their content available in India. The accompanying guidelines to these rules also prescribe certain thematic factors to be considered by publishers before making content available to Indian audiences. Under these rules, publishers of curated content will be answerable to the Union Ministry of Information and Broadcasting (“MIB”) which has been given the power to reprimand them and block their content, among other actions, in case of non-compliance. However, a recent interim order passed by the Bombay High Court has temporarily stayed those provisions of the rules which mandated adherence to a prescribed, statutory ‘code of ethics’ by the publishers of online news & current affairs content and publishers of online curated content (referred to as OTT in popular parlance) on the grounds that the rules prima facie seem to violate the fundamental right to speech and expression guaranteed by the Constitution of India and that they are beyond the mandate of the parent statute, viz. the Information Technology Act, 2000. (“IT Act”).

Some context

The rules, titled the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (“2021 Rules”) have been framed under the IT Act. They were notified and enforced on 25th February 2021 and have caused quite a stir on account of, inter alia, the onerous obligations placed on social media intermediaries and publishers of online news content and publishers of online curated content (“OCC”). However, issued amidst the backdrop of, or perhaps in response to various public interest litigation matters pending in courts across the country[1], it is the OCC space that now sees the introduction of regulation into a so far unregulated domain of digital content through the 2021 Rules.

Who this matters to

Until now, digital content published on the internet was accessible without any specific government intervention in India. Regulations did not impose compliance requirements on domestic or foreign OCC publishers. While platforms like Buzzfeed are registered businesses in India, most foreign content publishers make their content available in India without a formal business registration. Now, under the 2021 Rules, all OCC publishers will have to register with and become part of a government-recognized self-regulatory organization (SRO) as part of the three-tier grievance redressal mechanism introduced by the 2021 Rules. OCC publishers will have to comply with the 2021 Rules if they perform “a significant role in determining the online curated content being made available” and if they have any physical presence in India or enable domestic users to access OCC in the course of a “systematic business activity”. In the absence of any qualification on scale of operation, or business model (paid/free content) this triggers obligations for all OCC platforms that are accessible to users in India.

What does compliance involve

A publisher has to inform the MIB about the details of its entity (along with such documents as may be specified) for the purpose of enabling communication and coordination. This has to be done within thirty days of commencing operations in India or where the publisher already had commenced operations, this was to be completed within thirty days of the enforcement of the 2021 Rules. However, the official communication from MIB as regards the format, mode and particulars to be supplied for this part of the compliance came only on the 26th of May and the publishers were then granted a further period of fifteen days to ensure compliance. [2]

The 2021 Rules require publishers to create a grievance redressal mechanism and appoint grievance redressal officers within India. They also have to follow codes which have only been applicable to print and TV news in India so far.[3] The 2021 Rules also lay out specific procedures through which the government can issue orders to publishers to modify or take down certain content.

Further, publishers must self-rate content according to prescribed criteria and categories for advisable viewership. These criteria, inter alia, range from not publishing content which is prohibited under any law in force to exercising caution while publishing content which may disturb public order or may contain portrayal of beliefs of a religious or racial group. Content having violence, profanity, drug abuse or nudity is to be given a higher content rating. For certain categories of content, publishers are additionally required to implement access control mechanisms including parental locks and age verification mechanisms.

At each level, the 2021 Rules prescribe standards for timelines[4], recordkeeping and review. In addition, the 2021 Rules mandate a periodic compliance report to be generated by publishers and submitted to the MIB mentioning the details of the grievances received from users and the action taken thereon. Naturally, these trigger cost and possibly, tax implications which will need to be evaluated on a case by case basis.

Pertinently, by virtue of these 2021 Rules, the government  through the ‘Oversight Mechanism’[5] (especially the Inter-Departmental Committee’[6]) can directly issue an order to a foreign publisher through their point person in India (‘Grievance Officer’ under the 2021 Rules) and eliminate the (often cumbersome) requirement of enforcement of executive orders through a foreign judicial system under statutory provisions such as the CLOUD Act in the United States of America.

Industry response

In the months preceding the notification of the 2021 Rules, OCC platforms overwhelmingly petitioned the government against such measures. Offering up an alternative structure of a self-regulation code and toolkit by the industry. The Internet and Mobile Association of India (IAMAI), an industry body with members including the likes of Netflix, Google, Amazon, DailyHunt and several other platforms, even evolved and adopted such a self-regulation code, hoping to deter the government, but to no avail.

Post notification, the 2021 Rules have been challenged on grounds including unconstitutionality, excessive delegation and arbitrariness before several High Courts in India. A majority of these petitions are filed by digital news publishers and social media intermediaries. OCC publishers have so far stayed away from legal challenges and are largely trying to comply with the 2021 Rules. The Kerala High Court has granted protection against coercive action to members of the New Broadcasters’ Association in a plea challenging the 2021 Rules for exceeding the mandate of the parent legislation. However, other High Courts have declined interim protection in similar pleas. A plea has also been made by the central government before the Supreme Court to transfer all pending petitions against the 2021 Rules to the Supreme Court to avoid contradictory findings by different High Courts in the country. As mentioned above, the Bombay High Court has temporarily stayed the adherence to the ‘Code of Ethics’ by the publishers in an interim order

Government implementation

Despite pushback from the industry (social media intermediaries and digital news publishers particularly) the Government is following through with the implementation of the 2021 Rules. This is reflected in its stance before courts as well as through communiques such as one dated May 26, 2021 wherein it had sought disclosure of relevant information from publishers (including foreign OCC providers) operating in India[7]. A review of publicly available information on OCC platforms indicates that almost all OCC publishers have complied with the 2021 Rules at the time of writing this. Also, no governmental sanctions have been reported so far against any publisher as regards the 2021 Rules

What lies ahead?

In addition to the court cases mentioned above, there are more than a dozen other legal challenges pending against the 2021 Rules. As regards the temporary stay granted by the Bombay High Court, a final hearing is scheduled for later this month. It would be interesting to see whether the court converts its interim order to a final one or not. Meanwhile, in the Delhi High Court, the central government (through MIB) has filed its reply in a bunch of petitions challenging the 2021 Rules and asserted that the 2021 Rules will help tackle fake news, that they do not have a chilling effect on free speech and that they are based on “co-regulation”. Also, the Supreme Court could transfer to itself all the challenges pending in different courts across the country and adjudicate them together. Recent news reports also indicate that the central government is contemplating a new, all-encompassing law for digital media. All these developments are moving quickly, and we will keep you updated on the latest events through this space in the upcoming weeks. Stay tuned!

[1] Several of these petitions allege that content published on significant OCC platforms is seditious, defamatory, contemptuous, infringing, obscene, offensive, or otherwise illegal and pray for takedown.

[2] Please see footnote 8 below.

[3] The operation of this provision has been currently stayed by the Bombay High Court, temporarily.

[4] For e.g., an OCC publisher has to acknowledge a content-related complaint within 24 hours and act on it within 15 days.

[5] Rule 13 of the 2021 Rules

[6] Rule 14 of the 2021 Rules

[7] The information sought includes the publisher/platform’s website URL, mobile apps, company information, contact information, particulars of the news editors, and details about their grievance redressal mechanism. The communique is available here.