REGULATION OF INTERMEDIARIES IN INDIA
Regulation of intermediaries liability in India – The dependency on internet is increasing at an alarming rate. As per a 2017 report, India had 331.77 million internet users. This figure is projected to grow to 511.89 million internet users in 2022. Despite the untapped potential, India already is the second-largest online market worldwide. Although the advancement of technology and internet has brought with it all related benefits but has also led to massive increase in cyber-crime which directly or indirectly affects people. These crimes involve a wide range of malicious activities including cyber extortion, identity theft, credit card frauds, hacking the personal data from the computer, phishing, illegal downloading, industrial espionage, piracy, counterfeiting etc. All these crimes somewhere have a connection with an intermediary. Thus, discussing and understanding intermediary liability is of utmost importance.
The regulation of intermediaries gained momentum during early 90s, with the dawn of internet in India. In the beginning the regulation was limited, however as cyberspace began expanding its horizons, the issue of the scope of intermediary liability also gained pace. The role of intermediaries also evolved based on its scope, the information it shares and number of users it is reaching. The legal responsibility of an intermediary has travelled a journey, which started with an umbrella protection from any kind of liability.
In the year 2000, Section 79 for the first time legally spoke about liability of intermediaries. It provided expansive protection (a safe harbor) to intermediaries for third party content as long as they had no knowledge of its illegality or exercised due diligence. Further, in the year 2008, the amendment to Information Technology Act made it mandatory for the intermediaries to exercise due diligence to get protection under section 79 of the Act.
In the year 2018, the next leap was taken wherein the Delhi High Court in the case of Christian Louboutin v Nakul Bajaj clarified and further expanded the scope of an intermediary’s liability. It held that ‘When an e-commerce website is involved in or conducts its business in such a manner, which would see the presence of a large number of elements enumerated during the case, it could be said to cross the line from being an intermediary to an active participant. In such a case, the platform or online marketplace could be liable for infringement in view of its active participation. Needless to add, e-commerce websites and online marketplaces ought to operate with caution if they wish to enjoy the immunity provided to intermediaries.’
The liability of intermediaries can be found under the following:
- Section 79 of the Information Technology Act, 2000
- Rule 3 of Intermediary Liability Guidelines, 2011
- Clause 27 of Guidelines and General Information for Grant of License for Operating Internet Services
- Draft Rule 3 of Draft Intermediary Guidelines, 2018
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