#BulletinBoard – April 01, 2019 (The Copyright Directive for the digital single market passed by the European Parliament and more)

The Copyright Directive for the digital single market passed by the European Parliament

The European Union’s (“EU”) Copyright Directive for the digital single market, (“Directive”) has been voted in by the European Parliament on 26^th March, 2019 and is now set to go for a formal vote to the EU Council.

The Directive, among other things pertains to the responsibilities of online platforms which host user generated content and regulation of hyperlinks from news websites. The Directive stipulates that it is the responsibility of online platforms to ensure that they only host licensed or authorized content.

Quick View:

• The Directive is expected to have significant ramifications on online communication, and among other things, it would most notably make internet content platforms directly liable for the content uploaded to their site.  Consequently, the Directive is expected to enhance right holders’ opportunity to negotiate better remuneration deals for the use of their intellectual property on the internet.
• However, irrespective of the several purported advantages of the Directive, the same has faced a lot of criticism from all quarters. In addition to practical hurdles with respect to the lack of technology for monitoring the ever-changing online landscape to match the strict standards of the Directive, there are major concerns about the Directive forcing major corporations to strike down on otherwise fair use, just to avoid the risk of getting into trouble with the new laws. Further, there also are concerns that while the mechanism required for moderating content as required by the Directive could be managed by bigger corporations like YouTube, the exceptions for smaller corporations are ineffective and there would be an invariable ouster of smaller content hosting platforms that simply wouldn’t be able to afford an appropriate compliance mechanism.

New e-Form AGILE links GSTIN, ESIC, and EPFO to the Company incorporation application

The Ministry of Corporate Affairs had notified an amendment to the Company (Incorporation) Rules, 2014 (“Incorporation Rules”) via notification dated 29^th March, 2019.

The new amendment inserted Rule 38A into the Incorporation Rules, which provides that a (SPICe) application for incorporation of a company under Rule 38 of the Incorporation Rules must be accompanied by e-Form AGILE (INC 35) and must contain an application for the registration of the following items:

• Goods and Service Tax Identification Number (GSTIN), with effect from 31^st March, 2019
• Employees’ State Insurance Corporation (ESIC) registration, with effect from 8^th April, 2019
• Employees’ Provident Fund Organisation (EPFO) registration, with effect from 15^th April, 2019

The amendment also provides for the insertion of the e-Form AGILE (INC 35) into the Incorporation Rules.

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• The amendment falls in line with the Ministry of Corporate Affairs’ erstwhile efforts to streamline the incorporation of companies and to ensure a comprehensive application procedure. While the move adds another step to the incorporation process, it also ensures that the incorporating companies have met their requisite compliance standards, consequently acting as an early check.

Contractually agreed upon Arbitrator appointment procedure to be the first resort for the Courts: SC

The Supreme Court of India (“SC”), in the case of Union of India v. Parmar Construction Company passed an order stating that the High Court dealing with an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 (the “Act”) with respect to the appointment of an ‘independent arbitrator’ must first resort to the appointment mechanism provided in the terms of the contract agreed upon by the parties.

The issue in the instant case was whether it was permissible for the High Court acting under Section 11(6) of the Act [prior to the Arbitration and Conciliation (Amendment) Act, 2015 (“Amendment Act, 2015”)] to appoint a third party or an independent arbitrator when the contract executed between the parties provides for authority to appoint the designated arbitrator.

The SC highlighted that there were no questions raised upon the independence or impartiality of the arbitrator in the instant case, and that neither of the parties contended that the arbitrator appointed as per the terms of the agreement between then was unable to discharge his obligations. Consequently, the SC stated that the High Court was not justified in overlooking the inbuilt mechanism contractually agreed upon by the parties for the appointment of an arbitrator.

The SC also addressed the issue of applicability of the Amendment Act, 2015, and stated that the same shall not apply to arbitral proceedings which have commenced in accordance with the Act before the coming into force of the Amendment Act, 2015, that is before 23^rd October, 2015, unless the parties agree to the contrary.

Quick View:

• The order from the SC once again reiterates the judicial principle of giving first preference to the mutually agreed terms of a valid contract between parties and effectively goes on to limit judicial intervention on matters that have been addressed by a valid contract.
• Additionally, the order also clarifies the stance of the SC with respect to the applicability of the Amendment Act, 2015 while still allowing the parties to mutually opt for the application of same irrespective of when the arbitral proceedings commence.

Disclaimer: This post has been prepared for informational purposes only. The information/or observations contained in this post does not constitute legal advice and should not be acted upon in any specific situation without seeking proper legal advice from a practicing attorney.