Restrictions on Cross Border Data Exchange in India: A Good Move?

Nitya Jain, Institute of Law Nirma University

Introduction

The unprecedented surge in the global digital market has made data a valuable asset for individuals, corporations and Governments. Cross-border data flows have shrunk the world, allowing people across the globe to have the same user experience on the Internet. However, the explosion in the volume of data has generated as much a threat to its misuse as it created opportunities for companies. Today few global big shot organizations dominate the digital economy and their model is centered around data. Greater access to data provides a greater digital capital to a corporation, granting it an advantage over its competitors. Owing to this disadvantage faced by the domestic and small scale organizations, most jurisdictions impose conditions on when and how data can be transferred, and consequently some resort to physical data localization requirements. A study by Mckinsey Global Institute found that in 2014 the direct impact of cross-border data flows had raised world GDP by 3 percent (worth about $2.2 trillion in 2014), which exceeded the contribution of trade in traditional goods in that year.

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Samir Agarwal vs CCI – NCLAT’s Erroneous Approach Towards Locus Standi

Anurag Mohan Bhatnagar and Amiya Upadhyay, National Law University Odisha

Introduction

Recently, the National Company Law Appellate Tribunal (NCLAT) passed a decision wherein it ruled that the locus standi to approach the Competition Commission of India (CCI) shall only be restricted to the person who has suffered harm because of anti-competitive practices in the market. This has created a major turmoil in the competition law regime since the decision is in disregard of the intent of the legislature and settled principles of interpretation. Axiomatically, the term “any person” as under Section 19(1)(a) of the Competition Act, 2002 (Act) acts as a gate through which multiple entities can reach the commission with complaints of anti-competitive practices. The provision also ensures healthy competition in the market of India. However, it does not have a mechanism to filter-out ill-motivated and frivolous complaints reaching CCI.

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Disclosure Regime: SAT lays down parameters for timely disclosures

Gaurav Pingle, Practising Company Secretary and Renucka Vaiddya, Research Associate, Gaurav Pingle & Associates

The ‘Principles Governing Disclosures and Obligations of Listed Entity’ have been prescribed in Chapter II, Regulation 4 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. According to the provisions, a listed entity shall provide adequate and timely information to recognized stock exchange(s) and investors. However, what is adequate information is not very easy to determine and prescribe. It is very subjective – depending upon the nature of the transaction, the volume of transaction, and the company. Further, the Regulations provide that a listed entity shall refrain from misrepresentation and ensure that the information provided to recognized stock exchange(s) and investors is not misleading. A listed entity shall make the specified disclosures and follow its obligations in letter and spirit taking into consideration the interest of all stakeholders. The listed entity is also under an obligation to abide by all the provisions of the applicable laws including the securities laws and also such other guidelines as may be issued from time to time by SEBI and the recognised stock exchange(s) in this regard and as may be applicable.

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CORPORATE GENDER DIVERSITY IN INDIA – LOOKING BEYOND THE BOARD

Dr. Akshaya Kamalnath, Lecturer Auckland University of Technology

India’s regulatory intervention with regard to corporate diversity has focused exclusively on board gender diversity. It has required companies to have atleast one woman on its board. The relevant section of the Companies Act, 2013 is extracted below:

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IBC (Amendment) Ordinance, 2020: Hanging Sword On Personal Guarantors To Corporate Debtors

Ashutosh Choudhary & Gaurav Baheti are students at the National Law University, Odisha.

The nationwide lockdown enforced all over India due to the outbreak of Covid-19 pandemic is turning out to be a curse for the Indian economy. The uncertainty and distress created for corporate persons in businesses and the financial market of the Indian economy have severely disrupted the financial operations at large scales which may lead corporate entities into liquidation.[i] The Indian government has come up with several reforms to rescue corporate persons from economic distress in the current Covid-19 times from being pushed into insolvency proceedings under the Insolvency and Bankruptcy Code, 2016 (“Code”) for such defaults owing to the current time which might lead them into liquidation.[ii]

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Rupee Linked Derivatives in IFSC: A New Beginning

By Shubham Dimri, Law Graduate, Gujarat National Law University, Gandhinagar

Introduction

The NSE IFSC and BSE’s INX have started offering rupee linked derivatives on their platforms after receiving the approval from the Reserve Bank of India(RBI) and the Securities and Exchange Board of India(SEBI) early this year. This expands the bouquet of financial products offered in IFSC along with allowing for hedging of currency rate risk to prospective participants. The process of developing IFSC into a place, where rupee derivatives are traded, received a boost after the Task Force on Offshore Rupee Markets recommended that to prevent exchange rate shocks, currency rupee derivatives are needed to be brought within the ambit of domestic regulators. This was necessitated by the fact that non-deliverable forwards contracts in Rupee traded in foreign exchanges had a higher value and volume turnover than domestic exchanges which impacted the domestic macro-economic scenario. Following this recommendation, RBI and SEBI have framed rules for the segment in GIFT IFSC to start the process of developing the currency derivative market.

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Defining Contours of Freezing Orders Issued U/S 132(9B) of the Income Tax Act

Aditya Singh Chauhan, National Law University, Jodhpur

 Introduction

There is an increase in the number of freezing orders, whereby the tax authorities recover the amount due directly from the bank account of the tax payer.[1] This is due to the overwhelming amount of tax defaults, and increase in the pressure on the tax department.[2] One such provision that allows the tax authorities to issue freezing orders – section 132(9B) of the Income-tax Act, 1961 (“Act”) – was introduced by the Finance Act, 2017 to ensure that the revenue’s stake over the assessee’s assets is not unfairly misappropriated.[3] Such orders, however, are intrusive and have severe consequences on the business and reputation of the tax payer. The situation becomes more indiscriminate when such orders are issued against the foreign assets of the companies that are resident in India.

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Virtual Shareholder Meetings: The Future of Shareholder Meetings Post Covid-19

Ashuthosh V., Law student, Institute of Law, Nirma University

Introduction

A Shareholder meeting is a meeting between the management of the company and the owners and shareholders of the company. During the meeting, decisions are made concerning the day-to-day operations of the company. The purpose is to ensure that the shareholders are provided with an opportunity to discuss and deliberate upon affairs concerning the company. In a pre-Covid-19 situation, shareholder meetings were conducted in a physical venue and in accordance with the procedures under Section 96 of the Companies Act, 2013 (hereinafter “the Act”). It must be held at least once in a financial year, but not more than 15 months from the date of the previous one.  

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Analyzing the Changing Standard of Proof with respect to Commercially Sensitive Information in Cartel Cases

Nayan Mittal, Law Graduate, Symbiosis Law School, Pune

Introduction

Recently, in the case of In Re: Cartelization in Industrial and Automotive Bearings (“Automotive Bearings Case”) the Competition Commission of India (“the Commission” or “CCI”) held that the discussion with respect to a commercially sensitive price related information amongst the competitors points out to cartelization under the Competition Act, 2002 (“Competition Act”). This decision marks a noted departure from the exiting approach established in Re: Cartelization in Flashlights Market in India(“Flashlights Case”) wherein it was held that discussion on commercially sensitive information is not anti-competitive even if it is meant to increase prices and the parties must actually act upon the information in order to constitute a violation. The present article analyses the changing standard of proof requirement with respect to commercially sensitive information in the Commission’s decisional practice.

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