Monthly Intermediary Compliance Reports - Glass Half Empty

The IT (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (hereinafter referred to as the 2021 Rules), issued by the Ministry of Electronics and Information Technology (MeitY) in February 2021, significantly modified the regulations governing intermediaries in India.

The 2021 rules, for the first time, aimed at regulating Big Tech platforms with the guidelines creating supplementary obligations for ‘Significant Social Media Intermediaries’ (SSMIs) in addition to the general obligations applicable to other intermediaries. Any social media intermediary consisting of fifty lakh registered Indian users or more is deemed to be a significant social media intermediary for the purpose of the 2021 Rules. While this is a step in the right direction, there are still a few issues in the implementation of the said 2021 Rules, and this article aims to highlight one such issue.  

Rule 4 (1) (d) of the 2021 Rules places an obligation on SSMIs to publish monthly transparency reports disclosing: (i) the details of complaints received, and actions taken in response, (ii) the number of “parts of information” proactively taken down using automated tools; and (iii) any other relevant information specified by the government. Failure to comply with this obligation would lead to intermediaries losing their safe harbour immunity.
Therefore, to meet the above obligation, many SSMIs have started to issue their monthly compliance reports. However, inadequate disclosure about complaints received and action taken by the SSMIs relating to copyright infringement in these reports has created significant barriers for rights owners. Copyright owners are unable to a) determine the share of complaints related to copyright infringement within the total number of complaints received b) analyse the efforts made and action taken by intermediaries to address the copyright infringement complaints.  

Further, insufficient reporting and failure to issue monthly reports also increases the burden on IPR holders to monitor infringements. This is particularly problematic in the case of short-form video apps in India, which have been bolstered by a growing user base for Indian apps, following the ban on TikTok. It has been observed that compliance with periodic reporting obligations has not been uniform across all popular SSMIs as the format of reporting has been left to their discretion. While the compliance reports of some platforms are unavailable to the public, out of those that are available, it is observed that the number of user complaints received on the grounds of copyright infringement against which the action was taken, are not usually reported.

This lack of specific copyright infringement data in turn makes it difficult for copyright owners to determine the financial losses incurred due to infringement on content-sharing platforms, thereby defeating the very purpose of the compliance report i.e. transparency and accountability on part of the intermediaries. Being blindsided on copyright theft is also disadvantageous to copyright owners during licensing negotiations.  

Therefore, it is clear that there is a need for an amendment to the 2021 rules, placing an obligation on significant social media intermediaries to disclose the details of complaints received and action taken regarding infringement of copyright within the monthly compliance report under Rule 4 (1) (d).

As clarified by Rajeev Chandrashekar, Hon’ble Minister of State for Skill Development and Entrepreneurship of India, the government’s perspective is to ensure 4 boundary conditions for policy & rule making around the Internet - that is openness, safety & trust, accountability and complete compliance to the Indian Constitution & legal provisions.

The Hon’ble Minister is right- lack of accountability erodes the economic value due to the copyright holder. Therefore, given the fact that the Government is so crystal clear about its vision, we urge MeitY to take into account our recommendations which are very much in line with the same.