THE DATA PROTECTION AND IPR RELATED ASPECTS OF THE DRAFT E-COMMERCE POLICY:- IPR Club OurLegalWorld
The Department for Promotion of Industry and Internal Trade (“DPIIT”) released the Draft National E-Commerce Policy (“Draft Policy”) on February 23, 2019. It is a comprehensive regulatory framework for the already existing and rapidly growing e-commerce industry in India and around the world. According to statistics, India’s E-Commerce market is valued $38.5 billion, up 17 percent from the previous year. A primary worry is the security of the information submitted during an online transaction. Even if the parties’ contract is terminated, the Company is expected to take all reasonable efforts to prevent any corruption, damage, loss, or destruction of the private information or data. Contracts often include explicit sections to address such concerns about privacy, and they bind all employees, agents, and subcontractors, and also, E-commerce websites are often built and administered by third companies that are experts in the sector. A third party is frequently in charge of the material. Thus, unless the parties’ agreement expressly states that IP rights are protected, there is a risk of trademark, copyright, or patent infringement on an online platform. Thus, the need of protection of Data as well as Intellectual Property Rights arises.
DRAFT E-COMMERCE POLICY
Despite the fact that the Consumer Protection (E-commerce) Rules were implemented last year, vendors and brick-and-mortar retailers have complained that e-commerce companies are not following the rules. Because of the growing popularity of e-commerce shopping, online marketplaces must follow a strict set of standards. The draught report was written with the goal of helping stakeholders to take advantage of the opportunities that would develop as the domestic and global economies become increasingly digitalized. The draught study aims to identify measures for enhancing the regulatory environment – both to safeguard consumers and to make the ‘Digital India’ campaign more accessible through e-commerce. In the event of a conflict, the FDI policy will prevail over the e-commerce policy. Marketplaces must treat sellers fairly and not use data to gain an unfair advantage. Restrictions will apply to marketplace associates and associated parties. More offline sellers will be brought online by the government. In order to encourage e-commerce exports, India’s rapid delivery service is posting and integrating government interfaces. The Government e-Marketplace should be open to the public (GeM). E-commerce operators are responsible for ensuring that their algorithms are not skewed. It creates controls to guarantee that merchants’ products are authentic. In the event of end-to-end fulfilment, platforms will share culpability for counterfeits. Algorithms must not favour any one provider over another, and discount policies must be open and transparent. To combat digital monopolies, the government will ensure that additional service providers are available. The Indian government requires all e-commerce businesses to register. The competent agencies will be in charge of e-commerce activity measurement.
DATA PROTECTION & E-COMMERCE
The Indian e-commerce market has exploded in the previous five years, with plenty of space for future expansion. The Indian e-commerce market is expected to reach 300 to 350 million buyers by 2025, according to a recent estimate. Every day, an astounding diversity of transactions take place in the world of e-commerce, many of which require providers to have access to consumer data. Many people, however, are wary about handing over their personal information, and for good reason. Too often, highly sensitive data is mishandled, illegally utilised for advertising, or even passed on to third parties. It is highly recommended that businesses stay on top of the subject of data privacy in order to avoid dissatisfied consumers as well as any potential legal ramifications. Anyone who loses sight of the complicated data security issues too quickly risks breaching the law and paying hefty fines.
The Policy recognises the value of data as a resource and offers ways to safeguard data generated in India, improve data security, prevent privacy violations, and develop local standards for devices that store, process, and access data. It will aid the government in developing a plan to promote electronic commerce in India among vendors, customers, intermediaries, and other stakeholders, as well as integrating existing Indian logistic service providers with the digital economy.
The right to one’s data is owned by the individual. As a result, if an individual’s data is utilised in any way, it must be with his or her express agreement. This consent must be given voluntarily, in a form that is clear, and with consideration to the purposes for which it will be used. Even when data has been anonymised, the individual’s interests cannot be determined. I was absolutely cut off from it. There will always be data about a specific group anything valuable to them. The collective is thus data about a collection of persons and derivatives from it. The group’s property as a result, the data generated in India is owned by Indians as well as their derivatives.
In the age of e-Commerce, businesses have access to vast amounts of personal data. The question here is whether the firm has any legal right to possess information, especially if it chose to abuse it. There have been claims that data stored by giant organisations should be made available to other businesses via “compulsory licencing.” Another idea that has been floated in academic circles is to make data available under ‘FRAND’ terms. However, this overlooks the fact that these businesses do not own the data they have processed and sold.
As a result, a country’s data is best thought of as a collective resource, a national asset, which the government keeps in trust but over which the public has access. The analogy of a natural resource or spectrum mine is appropriate here. India’s inhabitants and government have a sovereign right to their personal information. This privilege cannot be extended to non-Indians (just as non-Indians have no presumptive right or claim to an Indian coal mine, for example). This idea stems from the recognition that information about an Indian is his or her own.
National data in various forms is a national resource that all Indians should have equal access to. In the same manner that non-Indians do not have equal access to national resources as Indians, non-Indians do not have equal access to national resources. Not everyone has equal access to Indian data. However, gaining access to it can be difficult. In the national interest, it was negotiated. As a result, e-commerce policy is concerned with the most effective use of this national resource for the purpose of optimising growth and providing the most advantages to all sectors of society.
This isn’t only a matter of personal privacy. With the draught Data Protection Bill, a comprehensive framework for preserving Indian citizens’ privacy is being developed. However, the challenges addressed in this Policy have a far broader scope. An initial step is to anonymize data before using it.
The location of computing facilities such as data centres and server farms within India would not only boost computing in India, but will also result in the development of local jobs. Current methods have changed as technology and the economy have evolved. The way people do business will change. Some operations, such as back office, are likely to increase processing time will be reduced. Many parts of business will be automated in the future. Artificial intelligence will be used more frequently. In this situation, a policy is important. Making for job generation is more important than it has ever been. During economic activity is expected to follow statistics in the future.
INTELLECTUAL PROPERTY RIGHTS & E-COMMERCE
Intellectual Property (IP) is perhaps the most neglected, yet the highest value-bearing component of E-commerce. E-Commerce more than any other platform often involves the selling of goods and services that are based on IP and its licensing. Online businesses should make sincere efforts to ensure their activities are free from IP risks.
The Intellectual Property Law protects a company’s or an individual’s commercial interests and enterprises from unfair competition. When it comes to the digital economy and E-commerce, without IP laws and practises, anything from music to software to design might be stolen, replicated, or distributed throughout the world without the owners being compensated for their one-of-a-kind creativity and labour. Furthermore, IP is involved in the operation of E-Commerce since components such as software, chips, networks, designs, and routers, to mention a few, are all kinds of IP that must be safeguarded in order for the Internet to function. Product or patent licencing is the foundation of all E-Commerce and internet enterprises. Because a wide range of technologies is required to make a product, most internet businesses either outsource the creation of some components or use licencing agreements to share technology. IP is considered the most important asset by e-commerce enterprises, and they frequently possess patent portfolios and trademarks to increase the value of their online businesses.
DIFFERENT INTELLECTUAL PROPERTY ELEMENTS OF PROTECTION FOR E-COMMERCE
- Patents and utility models can be used to protect E-Commerce systems, search engines, and other Internet-based technical tools.
- Software and text-based HTML code used on websites can be protected by copyrights or patents.
- Copyrights can be employed just to preserve the look and feel of a website, including text, photos, graphics, audios, and videos.
- Databases can be protected by special database laws or copyrights.
- Trademarks can be used to protect names, logos, insignia, and other symbols that appear on websites.
- Screen displays, graphic user interfaces, web pages, and computer-generated graphic symbols are all eligible for Industrial Design Protection.
- A trademark can be registered for any mark that expresses the company’s name and character.
- Patents can be applied for online business methods.
E-commerce covers international trade, domestic trade, competitive policy, consumer protection, information technology, and other topics. As a booming industry with a lot of interest from both domestic and international players, it’s critical to regulate it to protect the interests of both entrepreneurs and consumers. Promoting a positive environment and a level playing field is critical. Policymakers must also think about how to encourage a strong home economy. A comprehensive policy that represents India’s position in both domestic and international or multilateral settings is vital.
The Draft Policy clearly states that “An individual owns the right to his data” & “All such data stored abroad shall not be made available to other business entities outside India, for any purpose, even with the customer’s consent” from these points in the Draft Policy it is clear that the Individuals data is strictly protected & data sharing with any third party in a foreign country is restricted, even if the individual has consented to such data storage.
IP Rights help in safeguarding and maintaining the secrecy of trade activities, while providing the actual share of profits to the IP Right owners. IP Rights stand as a protective guard to the activities of the E-Commerce arena whose rate of success is completely dependent upon the implementation of effective IP Rights measures.
Article written by Sidhya Sasidharan, 4th Year BBA. LL.B.(Hons) Student, Government Law College Thrissur, Kerala.