E-com­merce pol­icy stuck over data pro­tec­tion law

Hindustan Times (Chandigarh) - - Front Page - Ra­jeev Jayaswal

NEW DELHI: In­dia’s long-pend­ing e-com­merce pol­icy is stuck be­cause the en­abling per­sonal data pro­tec­tion law is yet to be cleared by the cabi­net and the gov­ern­ment nei­ther wants to up­set for­eign in­vestors nor alien­ate the coun­try’s 70 mil­lion do­mes­tic traders, a key con­stituency of the rul­ing BJP.

Changes in for­eign di­rect in­vest­ment pol­icy for so-called emar­ket­places that came into ef­fect on Fe­bru­ary 1 have al­ready caused dis­rup­tions for the two largest on­line re­tail­ers — Ama­zon In­dia, the In­dian unit of Ama­zon.com, and Flip­kart, owned by Wal­mart Stores.

Drafts of both the e-com­merce pol­icy and the Per­sonal Data Pro­tec­tion Bill, 2018 are ready and in their re­spec­tive min­istries, await­ing a po­lit­i­cal green light, three of­fi­cials from three dif­fer­ent min­istries said on con­di­tion of anonymity.

The e-com­merce pol­icy is con­tin­gent upon the per­sonal data pro­tec­tion pol­icy, which will spec­ify the na­ture of sen­si­tive data that can­not be hosted in over­seas servers, and lay down mea­sures to pro­tect per­sonal de­tails of cus­tomers, ac­cord­ing to the of­fi­cials.

Email queries sent to the min­istry of com­merce and in­dus­try, the min­istry of law and the min­istry of elec­tron­ics and in­for­ma­tion tech­nol­ogy (Meity) on Tues­day did not elicit any re­sponses.

While MCI is re­spon­si­ble for the e-com­merce reg­u­la­tions, Meity is re­spon­si­ble for the per­sonal data pro­tec­tion leg­is­la­tion.

Ac­cord­ing to the of­fi­cials cited above, the gov­ern­ment is ap­pre­hen­sive of the tim­ing as the policies can­not please both for­eign in­vestors and lo­cal traders. It is cau­tious and eval­u­at­ing var­i­ous op­tions, one of the of­fi­cials said.

Key rea­sons for putting a com­pre­hen­sive e-com­merce pol­icy in place in­clude reg­u­la­tion of ac­cess to data that is one of the main el­e­ments for suc­cess of an en­ter­prise in dig­i­tal econ­omy; pro­tec­tion of con­sumers ; pro­mo­tion of do­mes­tic man­u­fac­tur­ers; to check the mis­use of dom­i­nant po­si­tion by lo­cal or global on­line re­tail­ers; and pro­vi­sion of a le­gal frame­work , the first of­fi­cial added.

The e-com­merce pol­icy should be aligned with the data pro­tec­tion law, par­tic­u­larly for per­son­ally iden­ti­fi­able data, said Arun Prabhu , a part­ner at law firm Cyril Amarc­hand Man­gal­das. A draft pol­icy gave a ref­er­ence to data as the oil of the dig­i­tal econ­omy and, in 2018, pro­posed a re­quire­ment for hard lo­cal­i­sa­tion whereby all data gen­er­ated by users from var­i­ous sources in­clud­ing e-com­merce plat­forms, so­cial me­dia and search en­gines had to be stored only in In­dia, he said. A draft of the Data Pro­tec­tion Bill, 2018, how­ever, pro­posed hard lo­cal­i­sa­tion only for crit­i­cal per­sonal in­for­ma­tion, he said.

To pro­tect the in­ter­ests of do­mes­tic re­tail­ers, the gov­ern­ment re­cently re­stricted for­eign e-com­merce mar­ket­places from sell­ing prod­ucts of com­pa­nies in which they had a stake and pro­hib­ited them from forg­ing any ex­clu­sive ar­range­ment with ven­dors.



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