Legal & Industry Updates - September 2021
SPECIAL EVENTS
International Virtual Conference on Competition Law - Risk, Challenges and Way Forward, September 23-24, 2021
The team at Ivy Law participated in a two-day international conference on “Competition Law: Risk, Challenges and Way Forward” organised by ASSOCHAM India. The conference, focused on reformative and retainer approaches in international competition law policies, free market and regulated market comparisons and sustainability arrangements in the global private sector. The conference also deliberated upon the role of data and privacy in competition law; development of a holistic and an all-inclusive competition policy to bring market regulation laws in synergy; and promotion of innovation in start-up companies by elimination of market abuse by large corporations and conglomerates, especially after the pandemic leading to large corporates joining the economic boom.
Webinar on “Emergency Arbitration and its Way Forward in India", September 18, 2021
The team at Ivy Law participated in a webinar on “Emergency Arbitration and its Way Forward in India” organised by Iuris Jura. The key highlights of the session focused on commercial arbitration mechanisms all around the world to facilitate emergency arbitration (emergency interim relief, following the issuance of an arbitration notice, prior to the formation of the arbitral tribunal) and how it has been a settling concept in India. The session also elaborated on emergency arbitration proving to be a crucial mechanism for interim reliefs.
Webinar on Corporate Challenges During COVID-19 Pandemic, September 16, 2021
The team at Ivy Law participated in a webinar on “Corporate Challenges During COVID-19 Pandemic” jointly organised by the Institute of Company Secretaries of India and Guru Gobind Singh Indraprastha University. The key highlights of the session focused on the need to contain the ripple effect regarding workforce layoffs, development of risk mitigation strategies, and sustenance of businesses by coping with multitude financial and legal concerns. The session also emphasised on the need for a better legal and administrative setup for emerging businesses, particularly in the entertainment industry through over-the-top platforms and e-commerce.
LEGAL & INDUSTRY UPDATES
Extension of Annual General Meetings (source)
The Ministry of Corporate Affairs (“MCA”) on September, 23 2021 through separate orders issued via Registrars of Companies (“RoC”) of different States, granted a two months extension for convening the Annual General Meetings (AGM) by companies for the financial year 2020-2021 (“Financial Year”). Section 96 (Annual General Meetings) of the Companies Act, 2013 provides that (other than in a One Person Company) the AGM shall be held within 9 months of the closing date of the first financial year, in case of the first AGM and in other cases, within six months of the closing date of the financial year. If a company is unable to hold an AGM within this time period, it can apply for an extension with the RoC via form GNL-1 and a maximum extension of three months may be granted by the RoC. The RoC’s after having received various representations from stakeholders facing difficulties in holding AGM’s for the Financial Year, on account of the pandemic, have extended the due date of holding an AGM (other than the first AGM) by a period of two months. Through this extension the AGM for the Financial Year, which had to be held by September 2021, is now extended up to November 30, 2021, without applying for an extension via GNL-1. This extension also covers applications already filed vide Form GNL-1 and are pending or are rejected. The companies which have already been granted an extension of a period more than two months, via GNL-1 may hold an AGM till the extension period as granted via their approved application.
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Fifth Amendment) Regulations, 2021 (source)
The Securities and Exchange Board of India through a notification dated September 7, 2021 has issued the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Fifth Amendment) Regulations, 2021 (“LODR Amendment Regulations”). The LODR Amendment Regulations require a listed entity to provide prior intimation to the stock exchange of at least two working days in advance, excluding the date of the intimation and the date of the meeting of the board of directors, about the board meeting in which the board is going to consider any of the proposals relating to (i) an alteration in the form or nature of non-convertible securities that are listed on the stock exchange or in the rights or privileges of the holders thereof; or (ii) an alteration in the date of the interest/ dividend/ redemption payment of non-convertible securities; or (iii) financial results, quarterly or annual, as the case may be; or (iv) fundraising by way of issuance of non-convertible securities; or (v) any matter affecting the rights or interests of holders of non-convertible securities. Further, the LODR Amendment Regulations also stipulate the submission of the annual audited standalone and consolidated financial results for the financial years, to the stock exchange(s) within sixty days from the end of the financial year along with the audit report.
Patents (Amendment) Rules, 2021 (source)
The Ministry of Commerce and Industry (“MCI”) on September 21, 2021 notified the Patents (Amendment) Rules, 2021 (“Amendment Rules”) to amend the Patent Rules, 2003 (“Principal Rules”). A new definition in Rule 2 of the Principal Rules has been inserted defining an “educational institution”. The new definition recognises an educational institution, as patent applicants for the purposes of Rule 7(1) and (3) (Fees) of the Principal Rules. The Amendment Rules, substitute Rule 7(1) second proviso of the Principal Rules to state that, in the case of a small entity, or start-up, or an educational institution, every document for which a fee has been specified shall be accompanied by Form-28 (To be submitted by a small entity/ start-up). Form 28 is required to be submitted by a start-up or a small enterprise (including an educational institution) along with every other form as a proof of being a small enterprise or start-up. Further, Rule 7(3) of the Principal Rules is also substituted with a new sub-rule (3) which provides for the difference in scale of fees (if any), to be paid by a new applicant (natural person, start-up, small entity or educational institution) for transfer of an application already being processed. Rule 7(3) of the Principal Rules is amended to include an educational institution as a transferor or transferee.
Plastic Waste Management (Amendment) Rules, 2021 (source)
The Ministry of Environment, Forest and Climate Change on September 17th, 2021 notified the Plastic Waste Management (Second Amendment) Rules, 2021 to further amend the Plastic Waste Management Rules, 2016 (“Original Waste Rules”). The amendment has been in furtherance to prohibit the manufacture, import, stocking, distribution and sale besides the use of certain single-use plastics. Earlier the Original Waste Rules prohibited the use of carry bags or products made of recycled plastic for storing, carrying, dispensing or packaging ready to eat /drink food items. Post the amendment, the Original Waste Rules allow the use of carry bags or products made out of recycled plastic for carrying, storing, dispensing or packaging ready to eat or drink food items, subject to appropriate standards and regulations having been met under the Food Safety and Standards Act, 2006 notified by the Food Safety and Standards Authority of India.
Kerala High Court Sets Aside Government’s Ban on Online Rummy (source)
As reported by Business World, the Kerala High Court on September 27, 2021 quashed the State government’s notification in banning ‘online rummy played for stakes’ by including it in the Kerala Gaming Act, 1960 (“Kerala Gaming Act”). According to the judgment, Kerala High Court denoted that the notification was arbitrary and violative of the right to trade, and commerce guaranteed under Article 19(1)(g) of the Constitution and the right to equality guaranteed under Article 14 of the Constitution. Various companies engaged in the business of developing and offering online games, challenged the government’s notification that included online rummy played for stakes in the purview of the Kerala Gaming Act. The court held that online rummy played either with stakes or without stakes remained to be ‘a game of skill’ and a game involving skill predominantly stood exempted from the Kerala Gaming Act.
Deficiency of Service to be Established in Consumer Matters Against Insurance Companies (source)
The Hon’ble Supreme Court of India, on September 28, 2021, upheld the findings of the National Consumer Disputes Redressal Commission in the matter of Khatema Fibres Ltd. vs. New India Assurance Company Limited, by holding that a customer cannot succeed in a consumer forum unless the deficiency in service is established on the part of a service provider and unlike a civil court, such a panel cannot subject a report of an insurance surveyor to ‘forensic examination’. The issue was raised in the case since a firm sought enhancement in insured amount on the ground that the surveyor did not assess the loss of insured articles properly. It was held that, once it is found that there was no inadequacy in the quality, nature, the manner of performance of the duties and responsibilities of the surveyor, in a manner prescribed by the regulations as to their code of conduct and once it is found that the report is not based on adhocism or vitiated by arbitrariness, then the jurisdiction of the consumer forum to go further would stop. Further, the Supreme Court opined that the role of the consumer forum is to check if there is a deficiency in service and if deficiency in service isn’t established, then the customer cannot succeed. The consumer forum is unlike a civil court where the service provider can be summoned and then cross examined on every minute detail.
American Airlines and Indigo Sign Codeshare Agreement (source)
As reported by Business World, American Airlines and IndiGo on September 28th, 2021 announced the signing of a Codeshare Agreement. The Codeshare Agreement will allow American Airlines to sell seats on Indigo’s flights operating on 29 routes. The codeshare is expected to begin in October, 2021. It is a one-way Codeshare Agreement which means one airline can sell seats on flights of other airline but not the other way around. In a two-way Codeshare Agreement, each airline in its distribution system can sell seats of other airline’s flights. American Airlines will be able to sell seats on 29 of IndiGo’s domestic flights on its distribution system, providing convenient flight options to American Airline customers to travel within India after landing in Delhi or Bengaluru. Currently IndiGo has a one-way codeshare with Qatar Airways and a two-way codeshare with Turkish Airlines.
Encryption not More Important than Law and Order (source)
As reported by Business World, the Ministry of Electronics and Information Technology on September 28th, 2021 stated that encryption cannot be more important than law and order, in extraordinary circumstances encryption should not be used as an excuse to deny assistance to enforcement authorities to bring perpetrators to justice. This statement came amidst an ongoing tussle between Government of India and the social media messaging giant WhatsApp, where the government requires the messaging platform to trace the origin of messages which may create a law and order situation, whereas the messaging platform argues that tracing the messages to the origin will effectively break the end-to-end encryption and may compromise the privacy of the individuals. WhatsApp has already taken the government to court challenging the new Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, but the government has been firm on its stand contending that traceability of the messages has no repercussions on end-to-end encryption and such a tracing arrangement is necessary for national security along with maintaining law and order in the country.
Disclaimer: The updates provided in this document is not a legal opinion and does not claim to capture all legal developments related to the subject matter stated herein. It is advisable to seek legal advice for accurate applicability, prior to relying on the updates for any legal matter.