Consumer Protection and Payment Wallets: A Case for Tech Based Intervention

Consumer-rpotection.jpg

 From being a heavily cash-based economy, India is witnessing a steady growth in digital payments. The Reserve Bank of India (RBI) notes that the share of electronic transactions in the total volume of retail payments increased from 88.9% in 2016-17 to 92.6% in 2017-18 with a corresponding reduction in the share of paper-based clearing instruments from 11.1% in 2016-17 to 7.4% in 2017-18. One of the popular modes of electronic payments is prepaid payment instrument (PPI) / payment wallet. The share of transactions carried through such PPIs in the total volume of retail payment transactions increased from 18.04% in 2016-17 to 8 21.94% in 2017-18.

 While the development of technological innovations has enabled businesses to provide such innovative products / services to consumers and also further the cause of financial inclusion, they also create new risks for the financial systems, particularly for vulnerable consumers such as the low-income groups, that are often the beneficiaries of financial inclusion schemes.

 In light of these developments, it is critical for policy makers to assess whether current regulatory / supervisory approach for regulating the ever-evolving payments sector is adequate. Just as emerging technologies are enabling the evolution of FinTech, financial sector regulators in many jurisdictions are leveraging technological innovations to increase the efficiency of their supervisory approaches particularly in automated data collection and data analytics.

 Against this background, this Concept Paper explores the possibilities of integrating technological solutions in RBI’s supervisory framework for PPIs with a view to enable the regulator to have access to real-time or near-real time access to consumer complaints data of PPIs, which can then be further used for data analysis. Broadly, this Concept Paper presents two alternatives for the consideration of the regulator: (a) direct access to consumer complaints data from the systems of PPI issuers on a real-time or near real-time basis; or (b) setting up a centralised online grievance redressal platform by RBI for accepting consumer complaints. Timely access to consumer complaints data of PPIs can assist RBI in identifying potential risks. This is in contrast to the existing mechanism that relies on approaches based on past data and onsite inspections that may often result in delayed supervisory action. Further, RBI’s direct oversight over the redressal process is likely to promote accountability among PPI issuers for discharging their consumer protection mandate efficiently and inspire confidence of consumers in the process. This is crucial in promoting the cause of financial inclusion. Needless to say, there are several considerations that have to be considered before adopting any approach, including conducting a technical feasibility and cost-benefit analysis.

 While RBI has been proactive in taking steps to promote consumer protection in the digital payments industry, we hope that this Concept Paper will help in sharpening such interventions further.

Click here to access the report on Consumer Protection and Payment Wallets

Discretion and Delay: Challenges of Becoming a District and Civil Judge

A transparent judicial recruitment process is a key priority of a constitutional democracy. Yet, the process of direct recruitment of Civil and District Judges across states, has several gaps and inconsistencies. This creates the potential for exercising arbitrary discretion and  delays in recruitment.  In the Ranking Lower Court Appointments report, we studied the timeliness and the ability to fill vacancies of these direct recruitment examinations across states. This report, however, takes a step back to look at the underlying state judicial service rules that govern the examination process for Civil and District Judges. These rules were studied to  identify how they fare on the metrics of accountability, transparency and efficiency. In addition, interviews and perspectives from stakeholders involved in the recruitment process threw light on how norms laid down in the rules function in practice. 

The objective of this report is to clearly identify ambiguities in the drafting of state judicial service rules that leads to uncontrolled discretion, ad-hocism, and uncertainty in the judicial service examination process. We argue that state judicial service rules must be drafted to establish clear procedures, mechanisms and guidelines that places accountability, transparency and efficiency at its core.

Click here to download the report Discretion and Delay: Challenges of Becoming a District and Civil Judge


Submissions on the Karnataka Draft Solid Waste Management Bye Laws and the Karnataka Draft Solid Waste Management Policy

Vidhi Karnataka has made two submissions to Directorate of Municipal Administration, Karnataka on the Karnataka Draft Solid Waste Management Bye Laws and the Karnataka Draft Solid Waste Management Policy. The submissions can be downloaded from the following links

Submission on Karnataka Draft Solid Waste Management Bye Laws

Submission on Karnataka Draft Solid Waste Management Policy

Insolvency and Bankruptcy Code-The journey so far and the road ahead

The Vidhi Centre for Legal Policy & EY are pleased to present "Insolvency and Bankruptcy Code: The Journey so Far and the Road Ahead" which was inaugurated by the Hon'ble Union Minister for Finance & Corporate Affairs Shri Arun Jaitley on 18th December at the IBBI-Vidhi Conference "Insolvency and Bankruptcy Code, 2016: A roadmap for the next two years".

This report take stock of the developments in the insolvency eco-system since the implementation of the Insolvency and Bankruptcy Code, identifies key challenges for the insolvency eco-system and suggests the next generation of critical reforms required to address these challenges.

We hope that this report will provide both impactful and novel ideas to improve capital availability, promote entrepreneurship, reduce judicial backlog and build a more efficient insolvency resolution eco-system.

Click here to download the publication Insolvency and Bankruptcy Code: The Journey so Far and the Road Ahead

A Framework for Countering Mobilised Violence

The Takshashashila Institution and the Vidhi Centre for Legal Policy, Karnataka, have jointly prepared a report on how to reform the legal framework for countering mobilised violence. The report analyses the economic costs of collective violence, assesses the current legal framework and suggests reforms to the current approaches towards mobilised violence, including creating a framework for liability of organisations and their leadership; reforming hate speech provisions under the Indian Penal Code and addressing institutional deficiencies in tackling mobilised violence.

Download the full report here.

A Proposal To Reform The University Grants Commission

books-classroom-close-up-289737.jpg

The purpose of this vision document is to consider how a new regulator to replace the

University Grants Commission (“UGC”) should be structured. This document is neither a

holistic vision for higher education in India, nor does it attempt to take sides on the myriad

contentious issues that need to be addressed in the higher education sector. Rather, its aim is

more modest — it is a vision for what a pan-India regulator should look like if the higher

education sector in India is to truly flourish.

Click here to download the full report

Suggestions on the draft Creche Rules released by the Labour Department, Government of Karnataka, under Section 28 of the Maternity Benefit Act, 1961

community-150124_640.jpeg

Vidhi - Karnataka submitted suggestions and objections to the draft Creche Rules released by the Labour Department, Government of Karnataka, under Section 28 of the Maternity Benefit Act, 1961. The draft Rules were released in furtherance of the mandatory creche requirement under Section 11A inserted through the Maternity Benefit (Amendment) Act, 2017.

Vidhi's suggestions to the draft Rules address three broad concerns: accessibility of crèche facilities by every woman employee; inclusiveness of children with special needs; and quality of amenities in crèche as laid down in the National Early Childhood Care and Education Policy."

Click below to download the suggestions submitted

English | Kannada

Competitive Neutrality in Corporate Governance Norms for CPSEs

State-owned Enterprises (SOEs) are significant players in the global economy. However, their governance poses unique challenges, primarily because the State which is the ‘owner’ of these enterprises, also acts as a ‘regulator’. This many a time manifests itself in the form of the State prescribing less-stringent norms for SOEs as compared to private sector companies, thus, creating an unequal playing field and distorting the principle of ‘competitive neutrality’.

The benefits of ‘competitive neutrality’ or maintaining an ownership-neutral legal and regulatory framework are aplenty. For example, adopting a market-driven legal framework for SOEs which is competitively neutral, will ensure better protection for minority shareholders, and will also make SOEs more productive by raising their governance standards. This in turn will assist in meeting several objectives of the government, including aiding disinvestment by securing higher valuations, increasing inflow of investment into SOEs, and reducing the liability of the government as a majority owner of such SOEs.

In the Indian context, SOEs are synonymous with Central Public Sector Enterprises (CPSEs), where the Central Government directly holds 51% or more shareholding in such companies. While various incentives may be offered to CPSEs such as subsidies and access to cheaper credit, our Report focuses on ‘statutory exemptions’ from corporate governance provisions, granted to government companies to demonstrate a lack of ‘competitive neutrality’ in the regulatory framework governing CPSEs vis-à-vis private sector companies.

Our Report studies various exemptions granted to CPSEs under company law, securities law and competition law, and reveals corporate governance distortions caused by such exemptions. Particularly, we find that certain exemptions granted to CPSEs under the current dispensation are redundant and may unnecessarily expose government finances to lapses. For instance, exempting CPSEs from the provisions of company law which place restrictions and reporting requirements for loans and investments made by companies, or disqualification of directors in case of companies which fail to file financial statements or repay deposit holders, are misplaced and do not resonate with the intent of the Central Government to increase accountability of the boards of CPSEs.

We supplement our analysis with three brief case studies - the acquisition of Hindustan Petroleum Corporation Ltd. by Oil & Natural Gas Corporation Ltd., the merger of State Bank of India with certain other state owned banks, and the Children’s Investment Fund-Coal India dispute, to lend context to our analysis of these exemptions. We also look at SOE governance in terms of competitive neutrality in the legal framework in three leading jurisdictions - Singapore, Brazil and Norway, and suggest Next Steps for India.

We hope that our Report sets the ball rolling and initiates a discussion on the merits of pursuing corporate governance reforms for India’s CPSEs, so that a level playing field is created, and Indian CPSEs are able to harness their true potential.

Download the full report Competitive Neutrality in Corporate Governance Norms for CPSEs

From Addict to Convict: The Working of the NDPS Act (1985) in Punjab

syringe-3322972_640.jpg

Vidhi released it's study ‘From Addict to Convict: The Working of the NDPS Act (1985) in Punjab’ on 22nd Aug, 2018.  The report evaluates the effectiveness of the NDPS Act in Punjab by analysing 13,350 NDPS cases across 18 districts in Punjab.

The report has some compelling findings on how the NDPS Act has failed to meet its twin objectives of deterrence and rehabilitation in Punjab where drug offences continue unabated.The report also highlights on the effectiveness of deterrent punishments, criminalizing drug consumption, the need to adopt a public health approach towards addiction, coordination between relevant Ministries, and the need for requisite legislative and policy change.

Click the following links to download the report

Volume I (English) | Volume I (Punjabi)

Volume II (English | Volume II (Punjabi)

Reforming the Tribunals Framework in India: An Interim Report

Tribunals.jpg

Tribunals form an important parallel structure for dispute resolution alongside regular courts. By involving expert members, administrative and logistical support from the executive, and specialised procedures, tribunals promise a speedy and more technical resolution of disputes under certain statutes. Unfortunately, despite its intentions, tribunals have often replicated some of the problems our judiciary suffers from and then some. Apart from issues such as rising pendency and inadequate funds, the constitution of tribunals often toes the line of judicial independence by an overemphasised role of the executive. Despite clear tests for constitutionality laid down in the Supreme Court, the reality of how tribunals operate is far from ideal. With non-uniform systems of appointments, removal, service conditions, etc. coupled with a larger say given to the executive, which is a frequent litigant before these fora, the framework of central tribunals leave much to be desired. While past Law Commission Reports and judicial pronouncements have tried to capture the essence of these issues, the true extent of the problems are often expressed in limited measure. Similarly, recommendations to improve this framework are often somewhat broad, with little emphasis given to specifics.

In this interim report, we examine the tribunals framework and offer a comprehensive statutory analysis of Acts, rules, and regulations, alongside a critical analysis of constitutional jurisprudence regarding tribunals. This captures the true extent of problems across the tribunals space. Furthermore, we construct an alternative to the present framework, by exploring a rationalised scheme of tribunal mergers and by fleshing out the organisational structure and functioning of a National Tribunals Commission to oversee this framework. This interim report hopes to offer the foundation for a more constructive discourse around tribunal reforms.

Download the full Report- Reforming the Tribunals Framework in India: An Interim Report

 

Securing our Future: Analysing the Regulatory Framework for Pensions in India

pension.jpg

In the past few decades, burgeoning populations and increasing life expectancies have led to an unprecedented rise in the elder population across the world. India is no exception to this trend, with the elder population projected to reach 19% of the total population by 2050. A significant part of this group will be unable to work for a living, and also simultaneously incur higher medical and other expenses. Not only does the lack of a financial security net for this group leave it vulnerable to a number of exigencies, it also increases the likelihood of inter-generational continuity of debt and a higher fiscal burden for the government of the day. Given these factors, the presence of a sound, efficient and reliable pension system is indispensable to the economy. Further some parts of the elder population, by virtue of their socio-economic standing, levels of education and financial sophistication are likely to be hit harder by ageing, and may therefore require targeted intervention for adequate protection. 

The Pension Fund Regulatory and Development Authority of India (PFRDA), set up in 2003, is responsible for establishing, developing and regulating pension funds in India. 

This Report has undertaken a study of the PFRDA Act and some of the key regulations under it, and suggested reforms wherever appropriate. Some of the important reforms surveyed are in the areas of redressal of subscriber grievances, regulations with respect to aggregators and points of presence, as well as the NPS Trust Regulations.

 International experience in this field, such as the pension systems in United Kingdom, Australia, Chile, Canada and New Zealand have also been surveyed to highlight best practices in this regard. 

This Report also points to prevailing gaps in the regulation of micro-pensions and the treatment of distressed pension funds. Both of these are critical, and this Report makes the case for detailed discussions on them. 

Lastly, this Report examines the Atal Pension Yojana, a PFRDA scheme targeted solely towards the unorganised sector. Having identified some unique concerns for this sector (which comprises of the majority of the workforce), this Report suggests some measures to tackle the same.

Download the full report Securing our Future: Analysing the Regulatory Framework for Pensions in India

Status of Physical Infrastructure in Lower Judiciary

lower_court_infra.jpg

The state of physical infrastructure in the lower courts remains an under-studied topic in India, despite such infrastructure being an important component of access to justice. In this bilingual report (English and Hindi), we examine the state of physical infrastructure of lower courts in Delhi and the National Capital Region (NCR). Using parameters developed by the National Court Management Systems (NCMS) Baseline Report on Court Development Planning System (Infrastructure and Budgeting), 2012, we have surveyed twelve (12) court complexes in Delhi and NCR. 

We illustrate how a litigant accesses court spaces and interacts with its physical infrastructure. A special focus has been given to vulnerable groups, such as persons with disabilities, to assess whether the physical infrastructure enables access or otherwise. The report also examines how this infrastructure varies between rural and urban court complexes. Broadly, it offers a comprehensive assessment of the status of physical infrastructure and what a litigant can expect from their nearest court complex. By doing so, it provides a blueprint for the infrastructural development of lower courts that can be used by the judiciary and executive.

Download the full report 'Status of Physical Infrastructure in Lower Judiciary'

Submissions on the draft New Drugs and Clinical Trials Rules, 2018

 

Vidhi responded to a call for public comments on the Draft New Drugs and Clinical Trials Rules, 2018. We have recommended changes to these Rules to better protect the rights and safety of clinical trial volunteers, ensure harmonisation with international standards where needed, ensure the integrity of the drug regulatory process and improve enforcement.

Download the complete submissions on the draft New Drugs and Clinical Trials Rules, 2018

Money and Elections: Necessary Reforms in Electoral Finance

crowd-1699137_640.jpg

In light of the modifications in electoral finance laws made in the 2016 and 2017 Budget, this report builds on existing discussions to clarify how such reforms in election law can be evaluated. It examines the evolution of key legal provisions before identifying barriers and systemic issues in the field on the basis of India’s unique experiences. It further enumerates potential solutions on the basis of international practice and draws up proposals to overcome existing regulatory barriers so that such solutions may be effectuated:

1. Electoral finance law must pivot towards transparency, strictly requiring disclosures of candidate assets and liabilities (including the source of assets), registration and reporting requirements for political parties, and the applicability of the Right to Information Act, 2005 to such parties.

2. Rules regarding funding and expenditure need to be tightened by placing an absolute cap on anonymous donations, banning corporate donations (except possibly to an Election Commission-controlled Trust), regulating political advertisements, preventing foreign sources of donations, outlining permissible categories of expenditure, regulating third-party expenditures, and laying a limited base for public funding.

3. The enforcement of the proposals above must be accompanied by the possibility of strict penalties such as the deregistration of defaulting political parties, along with increased provision for the independence of the Election Commission of India.   

Issues related to electoral finance have a long and troubling history in our polity with many previous attempts to tackle the problems involved. However, the matter has come back into focus with the last few Union Budgets creating avenues for funding through new instruments, measures that reduce public scrutiny on certain fronts, and changes that affect past foreign donations. This report was released at the Vidhi Dialogue event featuring Dr S.Y. Quraishi, Prof Rajeev Gowda, and Dr Aditya Sondhi.

Download the full report- Money and Elections: Necessary Reforms in Electoral Finance

Waste Picker Welfare Law in Karnataka

120821-F-BP133-050.JPG

Vidhi's report on Waste Picker Welfare Law in Karnataka focuses on the importance of Waste Pickers to India's Solid Waste Management and the need for a Waste Picker Welfare Law to ensure their well being.

The report specifically explores three themes- 

One, the vital contributions of waste pickers across India in tackling its solid waste management crisis. Two, the plight of waste pickers in the country due to the non recognition of waste picking as a genuine profession under the law and finally, the need for a law that specifically recognizes it as a genuine profession and grants them their associated rights

Download the full report on Waste Pickers Welfare Law In Karnataka

A study of Karnataka High Court’s Writ Jurisdiction

High_Court_Of_Karntaka_Closeup.jpg

A High Court’s writ jurisdiction is considered to be an ‘extraordinary jurisdiction’ whereby the High Court – which is at the apex of the State judicial machinery, becomes directly accessible to ordinary citizens seeking relief against any authority, including any Government. A detailed study of the manner in which this extraordinary jurisdiction is invoked and exercised, is in the interest of both the Judiciary and the State, since writ petitions constitute a bulk of a High Court’s burden, with most being filed against the Government.

Vidhi's Report on the Karnataka High Court’s writ jurisdiction is based on a data driven study of writ petitions filed before the Karnataka High Court across a period of five years before the Bengaluru Bench (2012-2016) and three years before the Dharwad and Kalaburgi Benches (2014-2016). 

The data has been studied to understand the nature of writ petitions filed against the Government, functioning at different levels of governance.  This gives us a nuanced understanding on the issue of ‘Government litigation’ and highlights the supply-side issues which contributes to making the ‘Government’, the biggest litigant. This study has also shed light on some of the inefficiencies in the functioning of the Karnataka High Court, both on the judicial and administrative side.

The raw data which has been collected for the purposes of this study will be uploaded shortly.

Download the full report on Karnataka High Court Writ Jurisdiction

Financing Urban Local Bodies in Karnataka

bangalore-550793_640.jpg

Vidhi's report on financing urban local bodies looks at the legal impediments that restrict urban local bodies in Karnataka from being financially independent. 

The report finds that City Corporations of Benglauru, Mysuru, Mangaluru and Davangere rely heavily on State Government grants and are unable to maximize their revenue potential due to shortcomings in the law. 

Due to limited enforcement capabilities, outdated guidance value, high number of litigation and archaic survey records of properties, City Corporations are unable to maximize their property tax collection. 

Download the full report on Financing Urban Local Bodies in Karnataka

Vidhi Bengaluru Briefing Book: 15 Legal Reforms for Karnataka

This briefing book on 15 Legal Reforms for Karnataka is a collation of suggestions made by the Vidhi Centre for Legal Policy, Bengaluru, to transform Karnataka's legal and regulatory environment by identifying 15 areas of law and governance in the State of Karnataka which are in need of reform, and suggesting means in which these reforms can be implemented. The briefing book covers three broad themes - improving laws providing for social welfare, particularly for marginalised sections of society; improving governance and regulatory structures, including judicial and administrative reform; and creating frameworks for properly governing with and improving technological innovation.

Download the full report 15 Legal Reforms for Karnataka

Government Litigation: An Introduction

IMG_4291.JPG

There is a wide consensus that India is in need of large-scale governance reform. In order to adequately address such a mammoth challenge, we need to delve deeper into factors that contribute to the inefficiency of public institutions. One such constituent is the high volume of government litigation. While it is well known that litigation clogs bureaucratic machinery, hardly any attempts have been made to understand the issue. In an effort to address this gap, Vidhi has taken an initiative to publish a series of reports on government litigation in India. 

The following report sets the context for the series by introducing government litigation as a challenge. It provides a literature review of current debates and policies to address the challenges, following which it highlights the scope of the series and its intended objectives. 

Download the full report on Government Litigation: An Introduction

The Law isn't Straight: A Queer Person's Guide to Accessing Rights

The-law-isnt-straight.png

Despite progressive judgments of the Supreme Court in NALSA v Union of India (2014) and Puttaswamy v Union of India (2017), the overall legal regime for queer persons in India remains severely lacking. Recognising the slow nature of legal change and the need for alternate strategies in the meantime, this manual is an attempt to help queer persons navigate their daily lives under this flawed regime. The manual deals with identity documents, violence, education, health and personal finances. 

While this manual seeks to be a useful starting tool for LGBTQ+ persons in their attempt to access the legal system, it does not reflect the diverse experiences different persons have while trying to access their rights. We would be grateful for your feedback and hope to update the manual to make it as useful as possible.

Download the full manual titled The Law isn't Straight: A Queer Person's Guide to Accessing Rights

Audio guides on how to change your name and gender on your basic identity documents are available in Hindi, Malayalam, Kannada, Bengali and Marathi

UPDATE

1. The Supreme Court of India, in its landmark judgement, Navtej Johar vs. Union of India, has struck down section 377 to the extent that it criminalises sexual intercourse between consenting adults of the same gender. At present section 377 can be used in cases of rape and bestiality. 

2. The application form for PAN cards now has the option of “transgender” person.