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A Push For Procedural Certainty


In an article recently published in India Business Law Journal’s February 2017 issue here, Gowree Gokhale and Jaideep Reddy of Nishith Desai Associates analyse the problems of delegated legislation/executive action and suggest ways to resolve them. The problems highlighted by them include lack of statutory/constitutional basis for such legislation/action in some cases and examples cited for it include the jurisdictional overreach by DIPP in issuing a memo interpreting Section 31D of the Copyright Act, which we had covered here. Another instance of such overreach, that we had covered  here and here, is the Agriculture Ministry’s issue of a draft notification creating a compulsory licensing system for GM technology patents. Here are a few snippets of Gowree and Jaideep’s article:

A Push For Procedural Certainty

Gowree Gokhale & Jaideep Reddy

“While the constitution and central and state statutes are the basis of India’s legal regime, delegated (or subordinate) legislation plays an important role in the regulatory landscape.

Delegated legislation often creates thorny issues for the legal community. This is usually because of procedural shortcomings, ambiguous drafting and frequent amendments.

BASES OF AUTHORITY

There have been several cases where principal legislation has not clearly defined the boundaries of delegated legislation. …

In some cases, the reverse is true: delegated legislation or executive action goes beyond the law’s mandate. A few recent examples highlight this.

In September 2016, the Department of Industrial Policy and Promotion (DIPP) issued an office memo making a substantive legal interpretation of section 31D of the Copyright Act, 1957. The section regulates the communication to the public of pre-published works by broadcasting organizations. The office memo stated that internet broadcasting organizations are covered by the section. As Shamnad Basheer, the founder of SpicyIP, pointed out in a letter to the DIPP, this office memo is likely beyond its jurisdiction. The only delegation that section 31D makes is to the Copyright Board, and for a limited purpose. The office memo does not state the statutory authority under which it is made, and there is no trace of such authority apparent in section 31D or the rest of the Copyright Act.

These examples act as reminders even to experienced practitioners to constantly analyse the constitutional and statutory basis of delegated legislation.

PROCEDURAL DISCIPLINE

In 2014, the central government, through the legislative department of the Ministry of Law and Justice, formulated a binding policy which reiterated that subordinate legislation must be made available for public comments where the principal statute requires it. In addition, the policy stated that all legislation from February 2014 onwards should require that drafts of its subordinate legislation be published for public comments.

Other rules are also prescribed. …

Public and stakeholder consultation can lead to fewer amendments in legislation and subordinate legislation, bringing about more regulatory certainty. Still, not every statute passed since 2014 has included a provision that all delegated legislation must be published for public comments, and earlier statutes relevant to the business community contain no such requirements. …

Another procedural shortcoming is that delegated legislation is often published on a ministry’s website but not notified in the official gazette (as all binding law is required to be). …There have also been instances of notifications being published in the gazette without being duly signed by the appropriate authority.

Legal professionals would be well-advised to refer to the law as notified in the official gazette when making assessments on what is binding. In this connection, the recent move of the central government to entirely digitize the official gazette can prove helpful.

CLEARER DRAFTING

One of the key problems with delegated legislation is ambiguous drafting, in some cases even arising from where a comma or semi- colon has been placed!

In connection with this, the 2014 policy required that every piece of legislation and delegated legislation be referred to the Law Ministry for vetting. …Hence, a draft should be submitted to the Law Ministry, which has a dedicated drafting department, to iron out creases.

If this policy is followed, the FDI policy and other delegated legislation will look more like legal codes and operate with much less ambiguity.

BETTER ACCESS TO LAWS

As mentioned above, a welcome move by the central government has been the complete digitization of the official gazette, beginning 2015. … The website egazette.nic.in is a repository of the central government’s gazette notifications including statutes, delegated legislation and amendments. …

However, it is still difficult to find the latest, authoritative, consolidated version of a given law, especially as regards delegated legislation and state law. This is because the pace of amendments for delegated legislation is high, with notifications under some laws numbering several a year (or month). …

While indiacode.nic.in (published and managed by the Law Ministry’s legislative department) is a good initiative, it contains only statutes of parliament, not delegated legislation, and the latest versions of some statutes are not available. And while the e-gazette website is helpful, it falls short in terms of the usability of the interface and some notifications not being searchable since they are uploaded as scanned copies.

… There is no repository, whether government or private, that comprehensively consolidates amendments with the principal laws (though new initiatives like Nyaaya appear promising). …

Two feasible solutions to this are, first, to have an e-gazette requirement that departments submit consolidated versions of delegated legislation whenever any amending notifications are submitted for publication. …

Second, as a more medium-term aspiration, indiacode.nic.in should be developed to be a comprehensive database of laws, including delegated legislation, and publish the latest, amended versions of laws. This has been successfully implemented by other jurisdictions with similar legal systems. …

To be truly effective, this cannot be done by the central government alone, since a significant body of law is under the jurisdiction of state governments. A statute ensuring convenient access to laws would be ideal, since it would in one fell swoop bind all executive authorities and carry greater weight. However, from a corporate perspective, initiatives by the central government to begin with would go a long way, because bread-and-butter corporate, tax, technology, and intellectual property laws fall under its jurisdiction.

TOWARDS SOLUTIONS

While the legal community is accustomed to finding ways to tackle many of these issues, in the rough-and-tumble of day-to-day practice, foundational rules of procedure and constitutionalism should be kept in mind.

Representations can be made to government, at least beginning with the central government, on the concerns that the issues above present. In this connection, the combined weight of corporate India can be brought to bear with good effect. In most cases, requirements already exist, such as gazette notifications, vetting by the Law Ministry, pre-legislative consultation (where applicable), clear statements of policy when delegating authority and the doctrine of ultra vires.

Cases of deviance can be highlighted with pragmatic suggestions for improvement. Recent cases … show that courts pay heed to such requirements when they are brought to their attention. In other areas, such as access to laws, advocating new requirements would appear the only way to create sustainable solutions.

While policy announcements can be encouraging, clear rules and procedural certainty can act as long-term drivers of a stable and prosperous business climate.

To read the full article, please click here.

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