Netflix, Amazon Prime, Hotstar, etc. now under scrutiny of Ministry of I&B

Content which is created and distributed in India, is monitored and regulated by the Government through various autonomous bodies. For instance, the Press Council of India (PCI) regulates print media, the News Broadcasters Association (NBA) monitors news channels, the Advertising Standards Council, which is a non-governmental body, keeps in check the advertising industry and the Central Board of Film Certification (CBFC) is in charge of regulating the public exhibition of films.

However, the content created on online streaming platforms, also known as “Over-The-Top” (OTT) platforms, is exhibited without any regulation or supervision of any governmental body. At present, several video streaming platforms such as Amazon Prime, Hotstar, Netflix, etc. have a viewer base of around 17 crore users forming a booming industry worth Rs. 500 crore in India and this number is expected to rise to Rs. 4000 crores by 2025. 

These online content providers come under the legal framework of the Information Technology Act, 2000 under the Ministry of Electronics and Information Technology but unlike print and broadcast media, the content created on these platforms is not being scrutinized up till now. 

However, the President, as per the power vested in him through Article 77(3), passed an order on 9^th November 2020 directing the regulation of online and digital media under the Ministry of Information & Broadcasting. This would include the regulation of films, webseries, video or audio content and news or current affairs related content created online. 

These rules were issued under Government of India (Allocation of Business Rules) Three Hundred and Fifty Seventh Amendment Rules, 2020. The Ministry of Information and Broadcasting will now be responsible for regulating platforms like Netflix, Amazon Prime, Hotstar and other platforms creating news online. The order per se does not mention any platforms however the order’s language is broad and inclusive.

In February 2020, the IAMAI had proposed a self-regulatory code for such platforms that made provisions for imposing penalties, etc. but the government did not support it. Therefore, the action of regulating such platforms can be sought as a necessary step considering the increase in consumption and creation of content on such platforms in recent times. Whether this regulation by Ministry of I&B will impact positively or negatively is yet to be understood, however, one could foresee that the platforms will not have the same liberty as they did before i.e. to say the platforms could have to apply for approval before streaming or publishing the content and the content could be subject to censorship. The consumers on the other hand could now have a redressal forum under the Ministry of I&B which could relieve the Courts to a certain extent.  

The Ministry of Information and Broadcasting will now have to formulate new guidelines, rules or an act to ensure adequate and appropriate regulation since as of now the platforms do not fall under the ambit of any other acts passed by the Ministry of I&B.  

RELIANCE BREACHES THE NON-COMPETE CONTRACT – CLAIMS AMAZON

A war for leadership in the field of E-Commerce market in India is seen to be initiated. Amazon Inc. recently served Future Group ltd. with a legal notice for allegedly breaching the non- compete contract due the deal that they signed with Reliance Industries Limited. Amazon then took a further step and approached the Singapore International Arbitration Center (SIAC) in order to prevent the deal between Reliance and Future Group.

Reliance Retail’s acquisition of Future Group is considered to be a significant move towards expanding its retail business through Jio-Mart and becoming a strong competition to leading ecommerce platforms like Amazon and Flipkart.

According to Amazon, it holds a 3.58% stake in Future Retail Limited as it had acquired a 49% stake in the promoter group entity of Future Group’s retail business, Future Coupons. The company further claims that the selling of a significant part of Future Groups business to Reliance is in breach of the terms of their contract. 

The Emergency Arbitrator of SIAC passed an interim injunction award favoring Amazon and stopping Future Group from taking any steps in relation to the transaction with Reliance. The matter was then brought in front of a Single judge bench, Judge Mukta Gupta in Delhi High Court with a prayer of issuing an ad- interim injunction against Amazon.

Initially Harish Salve argued for issuing an order to stop Amazon from interfering, he further submitted that the Emergency award was not recognized hence it is not binding under the Indian law. To this Adv. Subramaniam contended that the award was passed after considering the Indian law, he justified it on the grounds of Sec 2(8) of the Arbitration & Conciliation Act. He even questioned the maintainability of the ongoing suit.

The Hon’ble court questioned the parties on the law in relation to the concept of non-signatories to the arbitration agreement and then adjourned the hearing for the day.