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NASSCOM: Public Policy | Volume 2, Issue 1, | January 2021
Submissions and Representations
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Bullet DGFT: Representation for establishing an independent revalidation scheme for SCOMET authorisations
On 9 December 2020, NASSCOM submitted a representation to Directorate General of Foreign Trade (DGFT) requesting the establishment of a separate re-validation procedure for export authorisation of SCOMET items (intangible technology and electronic hardware). The current re-validation scheme is aimed at addressing only such schemes/authorisations that issued under Chapters 4 and 5 of the Foreign Trade Policy, which have associated export performance obligations. Accordingly, obligations to track end-use and end-users of the exports have been put in place. However, these obligations would not be relevant for SCOMET export authorisations without accompanying export performance obligations to fulfil.

Accordingly, NASSCOM represented the need for a separate re-validation procedure for export authorisation of SCOMET items (intangible technology and electronic hardware) based on an automatic and a conditional route for re-validation (read more).

Bullet SEBI: Feedback on the Consultation Paper on applicability and role of Risk Management Committee
Considering the multitude of risks faced by listed entities, risk management has emerged as one of the more important functions of the Board of Directors of a company. The Covid-19 pandemic has also reinforced the need for a robust risk management framework. In light of the increasing importance of the risk management function, Securities and Exchange Board of India (SEBI) recently released a Discussion Paper to solicit comments on proposed amendments to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR Regulations) regarding the requirement and the roles of the Board’s Risk Management Committee.

Based on inputs from industry, NASSCOM submitted its response to the SEBI on 9 December 2020, emphasising that the obligation to formulate a detailed policy on systems for internal control by the risk management committee, could lead to duplication and overlap with the role played by the Audit Committee of the Board
(read more).

Bullet OECD: Submission on Pillar One and Pillar Two Blueprints to address tax challenges arising out of digitalisation of economy
The Organisation for Economic Co-operation and Development (OECD) recently released its Blueprints on Pillar One and Pillar Two of the Unified Approach for public consultation, with a view to developing a consensus-based solution to address tax challenges arising out of digitalisation of the economy. Considering the likely impact of the Blueprints’ recommendations upon the technology industry, NASSCOM has been closely following the OECD’s work in this area.

Therefore, and given the significance of these proposals for Indian IT sector, NASSCOM organised a panel discussion on December 10, 2020 along with Eric Robert, (Adviser at OECD), Chetan Rao (Director FTTR-1, Ministry of Finance, Government of India), Hitesh Gajaria (Senior Partner – Tax & Regulatory Services, KPMG India) and Vijay Iyer (Partner – International Tax, EY India). The session witnessed participation from around 25 participants from top IT-BPM companies. The webinar recording is available at this link

Further, as a part of the Public Consultation, NASSCOM made its detailed submission to the OECD on 14 December 2020, based on the inputs received from the industry. In its submission, NASSCOM inter alia requested the OECD to provide clarity in the definition of Cloud Computing and Dual/ Bundled Services, as this could otherwise potentially trigger unintended applicability of Amount A for Indian IT service companies, including affiliates of Multi-National Enterprise (MNEs) that have Global Competency Centres

(read more).

Bullet MoCA: Feedback on draft National Unmanned Aircraft System (UAS) Traffic Management Policy
Ministry of Civil Aviation (MoCA) released the Discussion Draft of the National Unmanned Aircraft System (UAS) Traffic Management Policy (UTM Policy) on 30 November 2020. Based on industry feedback, NASSCOM made its submission on the draft Policy to MoCA on 30 December 2020. Among other suggestions, NASSCOM urged the DGCA to issue a detailed guidance on the data privacy and data protection aspects of the draft Policy, subsequent to the adoption and passage of proposed Personal Data Protection Bill, 2019 (PDP Bill) by the Parliament (read more).
Bullet MoLE: NASSCOM’s feedback on Draft Social Security (Central) Rules, 2020
On 27 December 2020, NASSCOM submitted its feedback on the draft Social Security (Central) Rules, 2020 which were earlier published by Ministry of Labour and Employment (available here). The feedback was based on the key concerns and suggestions highlighted by the industry. In our submission, we highlighted the need for the prospective applicability of method of computing gratuity to offset any financial impact on the employers. We also gave suggestions towards providing the option of reimbursing employees in lieu of creating creche facilities where it might not be possible to the employer to either arrange or setup such facilities on their own.
Bullet MCA: Companies permitted to conduct virtual board meetings till June 30, 2021
Given the ongoing circumstance of surging COVID-19 infections, many countries around the world are still maintaining travel/visa restrictions and are taking continued taking steps to curtail international travel of people, thereby precluding the conduct of physical board meetings. Accordingly, on 16 December, 2020, NASSCOM made a representation to the Ministry of Corporate Affairs (MCA) requesting a further relaxation in the provisions relating to conduct of physical board meeting by companies. Our representation to MCA is available here.

In a step that promises to provide much-needed relief to companies, while safeguarding health of individuals and ensuring compliance with statutory provisions, the MCA has subsequently permitted companies to conduct virtual Board meetings for approval of annual financial statements, Board reports etc. till 30 June 2021(read more).

Bullet SEBI: Submission on disclosures pertaining to analyst meets, investor meets and conference calls
SEBI recently released for comment, its recommendations relating to disclosures of analyst meets, investor meets and conference calls that could be included under LODR Regulations. The objective of SEBI’s suggestions is to strengthen disclosure of accurate information for investors and other stakeholders. Based on feedback from the industry, NASSCOM submitted its response to the SEBI on 21 December 2020.

As part of our submission, we have highlighted that the recommendations presently appear to be limited to interactions with investors alone. Accordingly, we recommended that interactions with sell-side analysts should be treated similarly and brought within the scope of the LODR Regulations, since they are important constituents in this ecosystem
(read more).

Bullet NITI Aayog: NASSCOM submits feedback on working document titled Enforcement Mechanism for Responsible #AIforAll
On 18 November 2020, NITI Aayog released for comment, a working document titled Enforcement Mechanism for Responsible #AIforAll. The document recommends a context-specific approach to regulate AI, and proposes the establishment of a new oversight body to advise existing regulators across sectors, on the responsible use of AI.

Given the significance of the proposal, NASSCOM organised an interaction with NITI Aayog on 9 December 2020. Senior industry leaders and AI experts from various companies joined the interaction and shared their views on the proposal. Post the interaction, NASSCOM submitted its feedback in which it suggested a risk based regulatory model on the lines of the 5-level risk based system of regulation developed by German Ethics Commission
(read more).

Bullet MeitY: NASSCOM submits feedback on draft National Strategy for Additive Manufacturing
Earlier in December 2020, MeitY released a draft National Strategy for Additive Manufacturing for public feedback. The draft strategy inter alia proposes a dedicated agency to analyse the ecosystem, identify existing disabilities including skill gaps, analyse sectoral potential / industrial clusters for integrating AM technology and develop a roadmap for wider adoption of additive manufacturing. Based on inputs from the industry, NASSCOM suggested extending the Product Linked Incentive (PLI) scheme to components/products manufactured through additive manufacturing and bringing more clarity to the responsibilities of the proposed National Additive Manufacturing Centre (read more).
Bullet RBI: Representation on Clarifications on Guidelines on Regulation of Payment Aggregators and Payment Gateways
In March 2020, the Reserve Bank of India (RBI) released the Guidelines on Regulation of Payment Aggregators and Payment Gateways, which created a regulatory framework for the operation of payment aggregators (PAs) and payment gateways (PGs). The RBI subsequently issued certain Clarifications to these Guidelines. Based on industry feedback, we have highlighted certain key issues and concerns arising from the Clarifications, which extended to concerns over the definition of “payment data”, limitations on payment data storage, processing and transaction tracking, and lack of clarity over obligations in scenarios of delivery versus payment (DVP) and post-paid transactions.

We have requested RBI to formally publish the Clarifications on its website so that any ambiguity on the genuineness of the document gets eliminated (read more).

Bullet DPIIT: Feedback on potential amendments to the Copyright Act, 1957
Earlier in October 2020, Copyright Office (under the Department for Promotion of Industry and Internal Trade; DPIIT) invited feedback on potential amendments to the Copyright Act, 1957 in view of technological developments and increased use of internet and digitalization in the dissemination of works in which copyright subsists. Based on inputs received from the industry, NASSCOM submitted its feedback to the DPIIT on 31 December, 2020.

NASSCOM’s recommendations focus largely around issues of intermediary safe-harbours, introduction of new exemptions for text and data mining operations, revisiting the standard of fair dealing under the law, enabling easier and technology-based solutions to statutory licensing, and streamlining the regulation of copyright societies
(read more).

Dialogue and Discussion
Bullet Roundtable Interaction: Emerging Opportunities for Global Capability Centres (GCC) in new regime at GIFT SEZ IFSC
On 12 November 2020, the International Financial Services Centres Authority (IFSCA) notified its Global In-House Centres (GIC) Regulations to provide a framework for recognition and operation of GlCs. In order to discuss the new policy developments, NASSCOM organized a roundtable interaction on ‘Emerging Opportunities for GCC in new regime at GIFT SEZ IFSC’. The roundtable, held on 18 December 2020, witnessed participation of various industry experts and officials from GIFT City and IFSCA. In this interactive discussion, teams from IFSCA and GIFT City engaged with participants on the regulatory, infrastructure and other relevant developments in the International Financial Services Centre (IFSC) and got feedback from the industry (read more).
Bullet Future of Fintech: Innovation in Regulatory Compliance
As a part of NASSCOM’s India Fintech Awards 2020, NASSCOM conducted a session on ‘Innovation in Regulatory Compliance’ on 15 December 2020. The session was in the form of a fireside chat with Ashish Aggarwal (Senior Director Head-Policy, NASSCOM) and Praveen Kamat (Deputy General Manager, IFSCA). The session saw discussion around the current & future needs of innovation in regulatory compliances related to Fintech. The recording of the session is available (here).
Bullet Foreign Trade Policy Review: Interaction with Commerce and Industry Minister
As part of the consultations for the review of the current Foreign Trade Policy 2015-2020 (FTP), NASSCOM interacted with the Minister of Commerce and Industry, the Commerce Secretary, and senior officials from the DGFT on 7 December 2020.

In the interaction, NASSCOM highlighted that the FTP should bear a specific reference for the inclusion of e-commerce exports, for example, by extending benefits to e-commerce entities under the Niryat Bandhu Scheme and the Market Access Initiative, establishment of dedicated e-commerce export promotion cells, establishment of e-Commerce Export Zones to promote growth of MSMEs and import duty exemption for re-imports of unsold/returned goods.

We also asked for the revision of the list of IT assets that can be taken out of the premises of a SEZ unit for working upon by employees in a work from home situation. Further, we suggested for the revision of FTP to extend Services Exports to India Scheme (SEIS) benefits to the new FTP as well as include Software and Technology Parks of India (STPI) units within the benefits of SEIS

(read more).

Bullet MoC: Meeting on Work from Home
NASSCOM and other industry representatives, met the senior officials from Ministry of Commerce on 8 December 2020, and reiterated industry requirements related to long term work from home for IT companies based in Special Economic Zones (SEZs). In the meeting, NASSCOM stressed on the need to have an operational certainty for SEZ units to plan their business operations towards adopting a new hybrid working model. In addition, we highlighted the need to review and simplify existing processes and procedures related to movement of assets, de-bonding of SEZ assets etc. towards ease of doing business.
Bullet IT-ITeS Policy: Interaction with Govt of Maharashtra
In the month of December 2020, NASSCOM had a series of meetings with the office of the Principal Secretary, Department of Industries, Government of Maharashtra, to discuss the roadmap for the upcoming IT-ITeS Promotion Policy of the State.

In our interactions, we suggested that the Government should strengthen the existing single window system, in order to provide timebound approvals and clearances. Further, we suggested that the existing processes and conditions for availing various fiscal and non-fiscal benefits under the policy should be simplified.

The importance of streamlining the IT procurement process of the State were also discussed, to which NASSCOM urged the Government to consider implementing a Model RFP framework. Lastly, given the critical functions performed by the IT sector, we suggested that the IT services sector should be classified as an Essential Service in the State.

Bullet DoT, TRAI, OSPAI and NASSCOM: Webinar on OSP Reforms
NASSCOM in association with Department of Telecommunications (DoT), Telecom Regulatory Authority of India (TRAI) and OSP Association of India (OSPAI) organized a webinar on 18 December 2020, to discuss the impact of the new OSP guidelines on the IT-BPM industry. Senior officials from the DoT, TRAI and industry leaders participated in the webinar. The recording of the webinar is available

(here).

Bullet GSTN and NASSCOM: Webinar on e-invoicing
The Central Board of Indirect Taxes and Customs (CBIC) decided to implement the e-invoicing mandatorily for companies with turnover exceeding INR 100 crores from 1 January 2021. With this background, and to clarify aspects relating to e-invoicing, NASSCOM along with the Goods and Services Tax Network (GSTN) team organised a webinar on e-invoicing clarify some aspects relating to e-invoicing. The session also focussed on procurement areas that companies, who are already covered under e-invoicing threshold (i.e. INR 500 Cr plus companies) should pay attention too. The webinar recording is available at this (Link).
New and Upcoming

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Bullet Call for Inputs: Recommendations of the Committee on Non-Personal Data
The Committee of Experts on Non-Personal Data Governance, chaired by Shri Kris Gopalakrishnan (NPD Committee) issued its revised Report for public consultation, and is inviting comments before 31 January 2021.The revised Report, takes on board the feedback received in the course of the public consultation, and proposes a new framework for the designation and sharing of certain High-Value Data Sets (HVDS) with high social and economic value, and explicitly excludes certain Data Processors’ data and foreign data from the applicability of the framework.

In order to unpack the new recommendations of the NPD Committee, NASSCOM will be hosting a discussion with members of the NPD Committee on 13 January 2021 from 11:30 am to 1:00 pm. Details of the meeting will be shared closer to the date with members. We are also inviting inputs from members on the revised recommendations of the NPD Committee. We request you to kindly share your inputs with NASSCOM by sending the same to policy@nasscom.in and indrajeet@nasscom.in before 22 January 2021 (read more).

Bullet Call for Inputs: SEBI Consultation Paper on review of framework of Innovators Growth Platform
SEBI has recently released a Consultation Paper seeking inputs on proposed amendments in the Innovators Growth Platform (IGP) framework. The IGP is aimed at issuers which are intensive in use of technology, information technology, intellectual property, data analytics, bio-technology or nanotechnology. Despite certain amendments to facilitate the platform, the IGP could not garner sufficient traction, and till date, the IGP platform has not witnessed any listings. Accordingly, the Consultation Paper revisits the framework to assess ways in which the platform could be made functional and relevant. Some of the suggestions in the Consultation Paper include reduction in the holding period of pre-issue capital, doing away with lock-in period of pre-issue capital for Alternative Investment Funds (AIF) – category II, voluntary delisting, migration to Main Board etc. In this regard, we request you to send your inputs/views on the proposed amendments by 8 January 2021 to garima@nasscom.in and tejasvi@nasscom.in
(read more)
Bullet Call for Inputs: Draft Model Standing Order for Service Sector
In accordance with Section 29 of the Industrial Relations Code, 2020, the Ministry of Labour and Employment, on 2nd January 2021, published the draft Model Standing Orders (Model SO) for the Service sector for feedback. The Model SO, among other things, provides for a simpler certification process, recognizes Work from Home and encourages employers to disseminate information to the workers through electronic mode. Stakeholders have been invited to submit comments and suggestions latest by 31January 2021. We request members to share comments to deepak@nasscom.in and jayakumar@nasscom.in before 22 January 2021 (read more).
Bullet Call for Inputs: Feedback on the draft National Science, Technology & Innovation Policy
Recently, the Department of Science and Technology (DST) published the draft National Science Technology and Innovation Policy (STIP). Among other things, the draft STIP proposes open data policy for public funded research, boost fiscal incentives for promoting R&D, improve ease of doing research and encourages equity and inclusion. Stakeholders have been invited to submit comments and suggestions latest by 25 January 2021. We request members to share their comments with jayakumar@nasscom.in before 19 January 2021 (read more).
Bullet Panel Discussion on Competition Issues in Digital Markets and its Impact on the Start-up Ecosystem in India
NASSCOM has been closely following inquiries and enforcement actions relating to online platform markets. This includes several inquiries by the Competition Commission of India into mobile operating systems and application stores, the EU’s proposal for a new Digital Markets Act, and most importantly, the FTC’s recent antitrust suits against major technology players in the United States of America. Given the renewed focus around antitrust issues surrounding online platform markets, NASSCOM is planning a short online Panel Discussion in the second half of January 2021, with officials from the Competition Commission of India (TBC) and competition regulators from other jurisdictions, to understand the key concerns of the regulators, understand the implications of the various enforcement actions in terms of impact on the start-up ecosystem, and gain insights into the expectations held of the technology industry by regulators. For more information on the event, please reach out to garima@nasscom.in and indrajeet@nasscom.in
Bullet Call for Inputs: Survey on Impact of Schrems-II on EU-India Data Transfers and Data Access Requests
NASSCOM and DSCI are conducting a survey amongst officials in the IT-BPM and GCC sectors, on the implications of the decision of the Court of Justice of the European Union (CJEU) upon the future of EU-India Data Transfers. The Questionnaire seeks to understand the manner in which respondent companies currently handle data access requests from the Government, and the details of their engagement with European counterparts on the issue of EU to India data transfers of European Personal Data. The Questionnaire, available here, requires e-mail based registration, an requires an approximate response time of 13-15 minutes. We request you to kindly provide your responses before 22 January 2021.
Bullet   NASSCOM-DSCI Discussion Paper on Future of Encryption in India
NASSCOM and DSCI have recently launched a Discussion Paper on the Future of Encryption in India. Using the premise of recent developments relating to personal data protection, cyber-security and prevention of online harms, the Discussion Paper explores possible paths towards a well-balanced regulatory framework for encryption in India – one which balances the needs of individual privacy and State access to communications information. Kindly share your inputs with indrajeet@nasscom.in before 30th August, 2020 (read more).
Other Updates
Bullet SEEPZ (Maharashtra): Movement of IT Assets are now allowed till 31.03.2021
The SEEPZ authorities in Maharashtra vide notification dated 24 December 2020, have extended the period for the temporary movement of IT assets till 31.03.2021, required for the purpose of work from home. NASSCOM based on the industry requests had earlier written to the Government on the need to extend this provision in lieu of the ongoing pandemic. We are thankful to the Government for considering our request.
Bullet Committee of Experts on Non-Personal Data Governance Releases Revised Report for Public Consultation
The NPD Committee chaired by Shri Kris Gopalakrishnan, released its revised report on Non-Personal Data Governance on 27 December 2020. In earlier rounds of public consultation pertaining to the contents of the NPD Committee’s Draft Report, NASSCOM had submitted detailed inputs which encapsulated the key concerns of the industry with the draft recommendations. We are pleased to see the Committee taking on board several of these recommendations, which include the exclusion of data processed by “data processors” and foreign data from the scope of mandatory sharing obligations, limiting the scope of NPD considered for mandatory sharing by defining limited “white-list” categories of NPD which can be considered to be of high social and economic value (read more).
Bullet RBI announces the opening of second cohort under the Regulatory Sandbox
On 16 December 2020, RBI announced the opening of second cohort under its Regulatory Sandbox (RS) with ‘Cross Border Payments’ as its theme. In a move to promote technological innovations aimed at financial inclusion, the RBI had proposed to set up regulatory sandboxes where start-ups could test new products, services or business models with customers in a live environment, subject to certain safeguards and oversight. Last year, in December, the RBI announced the opening of first cohort of the RS with ‘Retail Payments as its theme (read more).
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