Finance

Higher legal risk for third-party content: Social media firms to contest more curbs


Social media firms plan to challenge any change in law brought in by the government to tighten intermediary guidelines. The changes would lower the immunity granted to firms like Facebook, Twitter and WhatsApp, and over-the-top players like Netflix, Amazon Prime Video, etc, under Section 79 of the Information Technology Act for hosting third-party content and data. In such a scenario, such firms could face higher legal risks.

Government sources had earlier this week indicated that a new Digital India Act is in the works.

Executives of these firms said that though the final decision would depend on the contours of the new law, but one thing is certain, it would lead to increased litigation as the current provisions are draconian enough and do not merit further tightening. The legal fraternity, while acknowledging that there should be a measure of accountability on the part of social media firms, also maintains that regulations should be a light touch.

Last year, the government had brought about changes in the law by tightening clauses like Section 69A of the IT Act. Social media firms were asked to appoint grievance redressal officers in the country and resolve consumer grievances within a specific time period, as well as have designated nodal officers for coordination with the government over law and order matters.

The companies maintain that these changes are stringent enough to take care of government’s concerns and if they have complied with them why should they be subjected to further harsher measures.

Under the changes brought in last year, if social media firms fail in compliance of any of the provisions, their executives can face criminal liability and face a jail term for a maximum period of seven years, a provision which was not there earlier.

No wonder, legal expert are also cautioning the government against going for overkill.

“The validity of Section 79 of the IT Act, often referred to as safe harbour provisions, has been upheld by the Supreme Court in the Shreya Singhal case in 2015,” Ruby Singh Ahuja, senior partner, Karanjawala and Company, said. “Any dilution of the safe harbour provisions will not only be in direct contravention of the law laid down by the SC but will also not be in consonance with law as it exists in Western parts of the world,” she added.

Echoing a similar view, Manjul Bajpai, a lawyer specialising in the telecom sector, said, “With perfect balance and without compromising the security of the nation, enough freedom should be given to the intermediaries to grow in this tech world. Technology needs to grow so that it benefits the general public. WhatsApp is doing wonders. Even courts are now recognising WhatsApp to serve notice to parties in any case.”

Mishi Choudhary, technology lawyer and founder, SFLC.in, also favours a balance and light touch regulation and against going for overkill. She said, “Businesses are on a flight to Singapore, Dubai because of unpredictable, over regulations in India. We need light-handed regulations that keep people at the centre.”

Cyber law expert Pawan Duggal, while maintaining that the social media companies must be made more accountable, also points out that the process should be gradual rather than sudden. “India must come up with more cogent and effective mechanisms to make social media firms more responsible. There is a global trend which says blanket exemption from liability should not be given. But making these firms more accountable is a slow process, it’s not going to happen overnight,” he said.

A balanced and not a one-size-fits-all approach is also recommended by Prashant Phillips, partner, Lakshmikumaran & Sridharan Attorneys. “A balanced approach may have to be adopted which ties itself with the nature of intermediary and the functions that such an intermediary dispenses, rather than condensing all intermediaries under one omnibus categorisation,” he said.

Abhishek A Rastogi, partner at Khaitan and Company, offers a slightly contrarian view. He says that lot of personal information is privy to these firms and any leakage of such information could lead to serious financial frauds. Hence, strict guidelines would prevent such frauds and the customers/users would be more comfortable to use these platforms once they are comfortable with the security norms. “While these firms may face a slightly higher legal risk, in the long run, their businesses will end up gaining as customers will be more comfortable to use these platforms,” he added.


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