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CORPORATE DEFAMATION CASES: WHEN DOES NEGATIVE PUBLICITY CROSS LEGAL BOUNDARIES?

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– Aparna Iyer, Associate Introduction In today’s hyper-connected and digitally driven society, corporate reputations can be built or destroyed in a matter of moments. A single online post, tweet, or video can spark widespread criticism and public backlash against a company, sometimes even before facts are verified. While the right to express opinions and critique businesses is fundamental to a democratic society and a competitive market, not all negative publicity is lawful. Corporate defamation arises when false and damaging statements are made about a company, causing harm to its business interests, reputation, or goodwill. Determining when such publicity crosses legal boundaries requires a careful examination of intent, factual accuracy, and public interest. This article explores the evolving landscape of corporate defamation, highlighting key legal principles, notable cases, and strategies that businesses can adopt to safeguard their reputations without infringing upon freedom of speech. The Concept of Corporate Defamation Corporate defamation refers to the communication of false statements that are harmful to the reputation of a company. Unlike defamation directed at individuals, corporate defamation focuses on the damage caused to a business entity’s public standing or financial interests. Though a company is not a natural person, the law recognizes that it possesses a protectable reputation. Courts have consistently held that a corporation can initiate a defamation claim if it demonstrates that a false and defamatory statement has been made, that the statement referred to the company specifically, that it was communicated to a third party, and that it caused, or was likely to cause, injury to the company’s reputation or operations. The damage need not always be in the form of quantifiable financial loss; harm to business reputation alone may be sufficient for a claim to arise. Balancing Reputation and Free Speech However, not every unflattering comment or critical opinion gives rise to defamation. The law seeks to strike a balance between the protection of reputational interests and the fundamental right to freedom of expression, as enshrined under Article 19(1)(a) of the Indian Constitution. Criticism that is made in good faith, particularly when it relates to matters of public concern such as consumer rights, environmental violations, or unethical business practices, is often protected by legal defences such as fair comment or qualified privilege. These defences allow individuals, journalists, consumers, and even competitors to express opinions and share experiences, provided their statements are based on facts and are not driven by malice. The legal line is crossed when falsehoods are spread recklessly or deliberately, and with the intent to injure a company’s reputation. Courts usually examine whether the statement was presented as a fact or an opinion, whether there was sufficient factual basis for the opinion, and whether the speaker acted with due care or exhibited a malicious motive. The Role of Social Media in Defamation Dynamics With the rise of social media and digital platforms, the terrain of corporate defamation has expanded and become more complex. Today, dissatisfied customers, former employees, or even anonymous users can post reviews and comments that rapidly gain traction online. While many such posts may reflect genuine experiences and subjective opinions, others may involve misrepresentation, exaggeration, or malicious intent. The viral nature of digital content amplifies its reach and potential impact, making the damage to corporate reputation swift and often irreversible. Companies facing such defamatory content online can pursue various legal remedies. These include sending cease-and-desist notices to the individuals or platforms responsible, filing civil suits for defamation seeking damages and injunctions, and invoking provisions of the Information Technology Act and the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 to compel takedown of objectionable content. In some instances, companies have also initiated criminal defamation proceedings under Section 499 of the Indian Penal Code. However, courts exercise caution in granting sweeping injunctions, especially when the content in question involves consumer feedback or issues of public interest. The judiciary is mindful of the need to preserve the right to dissent and to prevent the misuse of defamation law as a tool to silence legitimate criticism. Strategic Considerations for Businesses Before resorting to litigation, companies must carefully assess whether the negative publicity in question truly crosses the threshold of defamation. Initiating legal proceedings in haste can backfire, attracting greater media scrutiny and public backlash—a phenomenon known as the “Streisand effect,” where attempts to suppress information only led to wider dissemination. Legal action should be considered when the statements are clearly false, baseless, and made with malicious intent, and when they pose a real threat to the company’s reputation or operations. In many cases, alternative strategies such as issuing public clarifications, engaging with the aggrieved party, or employing reputation management techniques may prove more effective and less confrontational. Conclusion In conclusion, corporate defamation law plays a vital role in protecting businesses from unfair and malicious attacks, but it must not be wielded to stifle genuine criticism, public discourse, or consumer advocacy. The courts have consistently sought to maintain a balance between reputational protection and the principles of free expression, evaluating each case based on its context, content, and intent. As the digital landscape continues to evolve, companies must develop a nuanced understanding of these legal boundaries, adopting both strategic and legal measures that respect free speech while defending their brand integrity. The challenge lies not in suppressing dissent, but in addressing defamation without undermining the democratic values that make critique possible.

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SPECIAL PURPOSE ACQUISITION COMPANIES: ARE THEY A BUBBLE OR THE FUTURE?

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Introduction to SPACs: A New Route to Market Access Special Purpose Acquisition Companies, or SPACs, have emerged in recent years as a disruptive innovation in capital markets, offering an alternative pathway for companies to go public without the rigours of a traditional Initial Public Offering (“IPO”). Though the phenomenon gained prominence in the United States, its ripple effects have been felt across international jurisdictions, including in India. The key debate in financial and legal circles today is whether SPACs represent a temporary speculative bubble or a transformative vehicle for the future of fundraising. With Indian companies increasingly looking to list overseas via SPACs, the relevance of this question for India’s regulatory and corporate landscape is growing rapidly. What is a SPAC and How Does it Work? A SPAC is constituted as a shell corporation devoid of commercial operations, formed for the express purpose of effecting a business combination with an operating entity. The SPAC itself has no operational business and is usually formed by sponsors such as experienced investors, industry professionals, or private equity firms, who contribute nominal seed capital. Once listed, the SPAC is given a time frame, usually 18 to 24 months, to identify and merge with a target company. If it fails to do so within the prescribed timeline, the SPAC is liquidated, and the capital raised is returned to investors. Once the acquisition is successful, commonly termed the “de-SPAC” process, the target company attains public company status by virtue of the SPAC’s pre-existing listing. Unlike traditional IPOs, SPACs facilitate a swifter route to public markets, allowing private companies to negotiate valuations and transaction terms directly with sponsors, thereby bypassing prolonged regulatory scrutiny and market volatility. The model offers considerable appeal to high-growth enterprises, particularly those in emerging or capital-intensive sectors, which may otherwise be ineligible for IPOs under existing profitability thresholds. Jurisprudential and Regulatory Evolution of SPACs Globally The use of SPACs increased significantly in the United States between 2020 and 2021, with over 250 SPACs listed in a single calendar year, aggregating over USD 80 billion in capital. This exponential rise was facilitated by historically low interest rates, abundant liquidity, and an insatiable investor appetite for speculative yet high-potential instruments. Prominent institutional investors, hedge fund managers, and public figures lent credence to the structure, thereby expanding its legitimacy. However, this rapid expansion also gave rise to significant legal and regulatory concerns. The U.S. Securities and Exchange Commission responded by proposing a series of rule-making initiatives aimed at enhancing investor protection and ensuring parity with traditional IPO disclosures. These included imposing liability on sponsors and underwriters, mandating enhanced forward-looking disclosure obligations, and subjecting financial projections to heightened scrutiny. Similar responses were observed in jurisdictions such as Singapore and the United Kingdom. The Singapore Exchange formalised a SPAC framework incorporating minimum market capitalisation, escrow requirements, and sponsor due diligence obligations. The United Kingdom followed suit by amending its listing rules to facilitate SPACs under a regime of heightened governance. These frameworks underscore the global regulatory consensus that while SPACs can serve legitimate economic purposes, they require rigorous safeguards to mitigate systemic risk. SPACs in India: A Regulatory Overview India, in contrast, has not yet accorded statutory or regulatory recognition to SPACs. Presently, the Companies Act, 2013 and the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 do not permit listing of entities devoid of operational track records. Consequently, SPACs are impermissible under extant legal architecture. In March 2021, SEBI issued a consultation paper soliciting public feedback on the potential introduction of SPACs in India. The concerns flagged therein included the speculative nature of SPAC transactions, sponsor misalignment with investor interests, valuation opacity, and the need for adequate investor protection mechanisms. As of date, SEBI has refrained from enacting a definitive framework, citing the nascent state of India’s capital markets and the need for calibrated experimentation. Offshore Structuring by Indian Companies Despite the absence of domestic enabling legislation, several Indian-origin entities have accessed capital via foreign-domiciled SPACs. Noteworthy among them is ReNew Power, which consummated a USD 8 billion business combination with a U.S.-listed SPAC, and Grofers i.e., now Blinkit, which explored a similar route. These transactions reveal a growing trend of Indian issuers leveraging regulatory arbitrage to access foreign capital markets in a manner not permissible within India’s sovereign jurisdiction. However, such cross-border transactions raise a plethora of legal considerations, including compliance with the Foreign Exchange Management Act, 1999, transfer pricing implications, taxation under the Income Tax Act, 1961, and disclosure obligations under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The absence of direct regulatory oversight in these cases may leave Indian stakeholders—particularly minority shareholders and retail investors—exposed to asymmetric risk. Legal Risks and Concerns Inherent in the SPAC Structure The SPAC model is replete with structural concerns, foremost among which is the issue of sponsor compensation. SPAC sponsors are typically entitled to a “promote” of up to 20% of post-IPO equity, often acquired for nominal consideration. This embedded incentive structure may compromise fiduciary prudence, as sponsors may be incentivised to consummate transactions irrespective of the underlying commercial viability of the target company. Additionally, SPACs often rely on aggressive forward-looking projections to justify valuations, a practice that would attract closer regulatory scrutiny under traditional IPO norms. The jurisprudential lacuna surrounding the enforceability of such projections, and the relative immunity enjoyed by SPAC sponsors against liability for misstatements, undermines market discipline and investor protection. Numerous class actions filed in the United States alleging securities fraud and negligent misrepresentation in de-SPAC transactions bear testimony to these risks. Are SPACs Indicative of a Speculative Bubble? There is considerable academic and financial debate surrounding the sustainability of SPACs. Critics have likened the 2020–21 SPAC boom to speculative bubbles of the past, citing overvaluation, poor post-listing performance, and mass investor disillusionment. Empirical evidence suggests that a substantial number of de-SPACed entities underperform market benchmarks within the first year of listing, leading to wealth erosion for public shareholders. Nevertheless, it would be jurisprudentially flawed

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LEGAL RISKS IN LICENSING AGREEMENTS FOR AI & MACHINE LEARNING MODELS

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NAVIGATING THE LEGAL LANDSCAPE FOR AI LICENSING IN INDIA Licensing AI and machine learning models in India presents complex legal challenges. The rapid evolution of AI technology demands precise agreements to manage intellectual property (IP) rights, data privacy, and liability. As Indian laws continue adapting to emerging technologies, businesses must proactively ensure compliance. A thorough understanding of potential legal risks is essential to safeguard operations and prevent future disputes. DEFINING INTELLECTUAL PROPERTY OWNERSHIP AI models are built on intricate algorithms, datasets, and proprietary code. Licensing agreements must clearly define ownership rights over the underlying technology and its outputs. In India, establishing clear IP terms is critical to prevent disputes over patents and ownership. Agreements must specify whether rights belong to the developer, the licensee, or a third party, providing certainty and reducing the risk of legal conflict. ENSURING COMPLIANCE WITH DATA PROTECTION LAWS India’s Digital Personal Data Protection Act, 2023 (DPDP) mandates strict protocols for processing personal data — a critical concern when licensing AI models. Agreements must clearly address data usage, storage, and processing requirements, ensuring adherence to privacy standards. Non-compliance can result in significant penalties, reputational harm, and loss of business, making data protection a top priority in AI licensing. ALLOCATING LIABILITY AND INDEMNITY RISKS AI systems can cause unintended harm, raising complex liability issues. Licensing agreements must expressly define responsibility for damages arising from AI operations. In India, clarity on whether the licensor or licensee bears the risk is essential. Including detailed indemnity provisions protects both parties, ensuring financial and legal safeguards if the AI model causes harm or operational failure. SAFEGUARDING CONFIDENTIAL AND PROPRIETARY INFORMATION Licensing AI often involves the exchange of sensitive datasets, algorithms, and technical know- how. Agreements must include robust confidentiality clauses protecting trade secrets and proprietary assets. Under Indian law, breaches of confidentiality can result in severe legal consequences. Licensing terms should clearly define confidential information, duration of protection, permitted disclosures, and remedies for breach. STRUCTURING TERMINATION AND DISPUTE RESOLUTION A well-crafted termination clause protects both parties against future risks. AI licensing agreements must address the handling of the AI model, associated datasets, and IP rights post-termination. Clear dispute resolution mechanisms, such as arbitration or mediation, should also be specified. In India, precise termination and dispute clauses prevent prolonged litigation and facilitate smoother contract closures. MANAGING CROSS- BORDER LICENSING RISKS Given the global nature of AI, licensing agreements frequently involve cross-border considerations. Parties must establish the governing law, jurisdiction, and dispute resolution forum upfront. In India, careful drafting of jurisdictional clauses minimizes the risk of conflicting legal interpretations and ensures enforceability, even when international parties are involved. CONCLUSION: PROTECTING AGAINST LEGAL RISKS IN AI LICENSING Effective AI licensing demands rigorous legal structuring and foresight. By partnering with legal experts specialized in AI and technology law, businesses can ensure compliance with Indian regulations, protect their IP, and mitigate operational risks. Strong, clear agreements not only prevent costly disputes but also build a foundation for secure, long-term partnerships in the evolving AI landscape.

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DISTRESSED REAL ESTATE ASSETS: HOW INSOLVENCY LAWS ARE BEING USED TO RESOLVE CRISES

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– Kailash Ram, Associate The Indian real estate sector has faced significant turbulence, marked by numerous stalled projects, developer defaults, and the plight of homebuyers left with uncertain investments. Prior to 2016, resolving such distress was fragmented and protracted. The enactment of the Insolvency and Bankruptcy Code, 2016, marked a watershed moment, providing a consolidated, time- bound framework aimed at resolving insolvency, maximizing asset value, and balancing the interests of all stakeholders, including the long-neglected homebuyers. The IBC operates alongside the Real Estate (Regulation and Development) Act, 2016, which primarily focuses on project regulation and buyer protection, while the IBC addresses the financial distress and insolvency of the developer entity itself. Auto-renewal clauses are contractual provisions that facilitate the automatic renewal of services for a subsequent term unless terminated by the consumer within a specified period. These clauses are typically drafted to favour. Unique Challenges Addressed by IBC in Indian Real Estate The IBC framework had to grapple with sector-specific complexities: The IBC Framework and Real Estate Insolvency The IBC introduced the Corporate Insolvency Resolution Process (CIRP), a structured mechanism applicable to distressed real estate companies: Empowerment of Homebuyers under IBC: A Landmark Shift Perhaps the most significant impact of the IBC on real estate has been the empowerment of homebuyers: Innovative Resolution Mechanisms Evolving under IBC Recognizing that a ‘one-size-fits-all’ approach doesn’t work for real estate, the IBC framework has seen significant evolution through regulations and judicial interpretation: Ongoing Challenges Despite significant progress, challenges persist: Conclusion The Insolvency and Bankruptcy Code, 2016, has fundamentally reshaped the landscape for resolving distress in India’s real estate sector. By granting homebuyers the status of financial creditors and fostering innovative, sector- specific solutions like project-wise resolution and Reverse CIRP, the IBC framework, guided by judicial interpretation and regulatory adaptation, strives to move beyond mere liquidation towards viable project completion and stakeholder value maximization. While challenges in implementation remain, the IBC provides a dynamic and evolving legal tool critical for addressing insolvency crises and restoring confidence in the Indian real estate market.

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JUDICIAL ACCEPTANCE OF EMERGENCY ARBITRATORS IN INDIA: AN EMERGING TREND?

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Introduction Emergency Arbitration is swiftly gaining traction as a preferred route for urgent interim relief in high-stakes international disputes. It offers a fast-track mechanism for parties seeking to preserve their rights before the full constitution of an arbitral tribunal. However, in the Indian context, the legal enforceability of Emergency Arbitrators’ orders has historically resided in a grey zone. This presentation delves into the evolving judicial approach in India, the legislative lacunae under the Arbitration and Conciliation Act, 1996, and how recent landmark judgments are reshaping the enforcement landscape. Understanding Emergency Arbitrators Emergency Arbitrators (EAs) are specially appointed by arbitral institutions to grant interim relief in urgent cases—typically before the arbitral tribunal is formally constituted. This mechanism is widely recognised and utilised under institutional rules of arbitral bodies such as the Singapore International Arbitration Centre (SIAC), the International Chamber of Commerce (ICC), and the London Court of International Arbitration (LCIA). EAs empower parties to prevent irreparable harm and maintain status quo in time-sensitive disputes. Nevertheless, because they derive authority solely from institutional rules and not domestic statutes, their recognition in municipal legal systems like India’s remains limited and contested. Legal Gap in Indian Arbitration Law The Arbitration and Conciliation Act, 1996, as it currently stands, does not make any express provision for Emergency Arbitrators or the enforceability of their decisions. Indian law allows for interim relief under Section 9 (courts) and Section 17 (arbitral tribunals), but since EAs operate before a tribunal is formally constituted, their jurisdiction falls outside these provisions. This legal vacuum has posed a long-standing barrier to the seamless adoption of Emergency Arbitration in India, especially when it comes to domestic arbitrations or ad hoc proceedings. Amazon v. Future Retail – A Precedent A watershed moment in India’s Emergency Arbitration jurisprudence came in the Amazon.com NV Investment Holdings LLC v. Future Retail Ltd. case. The dispute arose when SIAC’s Emergency Arbitrator issued an interim order restraining Future Retail from proceeding with a deal with Reliance. Amazon sought to enforce the order in India, sparking a legal battle that reached the Supreme Court. Both the Delhi High Court and the Supreme Court upheld the enforceability of the emergency award, recognizing it under Section 17(1) of the Arbitration and Conciliation Act. The case underscored judicial willingness to honour party autonomy and institutional rules, thus signalling a paradigm shift in India’s approach to Emergency Arbitration. Supreme Court’s Recognition of EAs In its 2021 decision, the Supreme Court firmly established that orders issued by Emergency Arbitrators are enforceable under Section 17(1) of theArbitration Act. The Court highlighted the importance of party autonomy—the freedom of parties to select institutional rules that permit Emergency Arbitration— as a cornerstone of modern arbitration. It clarified that there is no statutory embargo preventing courts from recognising and enforcing such orders. This judgment marked a turning point by bringing Emergency Arbitration out of the legal shadows and into the realm of enforceable interim mechanisms under Indian law. Remaining Challenges and Ambiguities While judicial recognition is a welcome development, Emergency Arbitration still faces several hurdles in India. The absence of express statutory recognition continues to cast doubt on the enforceability of emergency orders, particularly in domestic arbitrations. Different High Courts have adopted varying interpretations, and procedural inconsistencies persist due to the lack of uniform legislative guidance. Questions around the binding nature of EA orders, appeal mechanisms, and their place in the Indian legal hierarchy remain unresolved. A formal legislative amendment acknowledging Emergency Arbitrators and clearly outlining their powers and limits would help harmonise practice and boost investor confidence. Implications for Commercial Contracts For commercial entities—especially those engaged in high-value, cross-border transactions—incorporating institutional arbitration rules that support Emergency Arbitration is increasingly advisable. Well-drafted arbitration clauses referencing bodies like SIAC or ICC can provide access to rapid interim relief mechanisms and facilitate smoother enforcement within India. However, until India’s legislative framework evolves, the enforceability of such orders will depend largely on judicial discretion, party cooperation, and the jurisdictional alignment of the dispute. Legal teams must proactively structure contracts and arbitration strategies to navigate these complexities and maximise the utility of Emergency Arbitration.

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Digital Currency Dispute: Legal Risk in the Rise of CBDCs

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The evolution of money from paper-based to digital forms is now entering a transformative phase with the advent of Central Bank Digital Currencies (CBDCs). As sovereign-backed digital currencies gain traction globally, legal systems are grappling with the implications of this paradigm shift. While CBDCs promise efficiency, financial inclusion, and real-time settlements, they also introduce a spectrum of legal and regulatory challenges. The potential for disputes—ranging from privacy concerns to cross-border jurisdictional issues—raises critical questions about how legal systems must adapt to manage the risks associated with this digital evolution. The Emergence of CBDCs CBDCs are digital versions of a country’s sovereign currency, issued and regulated by the central bank. Unlike cryptocurrencies such as Bitcoin, which operate on decentralized networks, CBDCs are centralized and backed by government authority. Several countries—including China, India, and the Eurozone—are piloting or actively developing their own CBDCs to modernize payment systems, combat illicit financial flows, and maintain monetary sovereignty in the face of private digital currencies. Legal Risks in the Rise of CBDCs 1. Data Privacy and Surveillance Concerns One of the most pressing legal challenges surrounding CBDCs is the potential erosion of financial privacy. Since transactions are recorded on centralized ledgers, governments may gain unprecedented access to citizens’ spending behavior. This raises constitutional concerns, especially in democracies where the right to privacy is protected, such as under Article 21 of the Indian Constitution post Puttaswamy v. Union of India. Balancing transparency for regulatory oversight with the protection of individual privacy rights will be a key legal battleground. 2. Jurisdiction and Cross-Border Disputes CBDCs could radically alter cross-border transactions, potentially bypassing the SWIFT network and conventional correspondent banking systems. This introduces complex legal questions regarding jurisdiction, enforceability of contracts, and conflict of laws. Disputes may arise where transactions involve parties in multiple countries with differing legal frameworks for digital currencies. There is a pressing need for international consensus or treaties to regulate CBDC interoperability and dispute resolution. 3. Consumer Protection and Legal Recourse With CBDCs, the interface between users and the digital currency system may be managed by intermediaries such as commercial banks or fintech platforms. In the event of system failure, fraud, or erroneous transactions, liability may become a legal grey area. Consumers must be afforded adequate protection, including clear mechanisms for redressal and compensation. Legislatures will need to update existing consumer protection laws or create specialized frameworks for digital finance. 4. Cybersecurity and Operational Risks Given that CBDCs are built on digital infrastructure, they are vulnerable to hacking, technical glitches, and systemic cyber threats. Any breach can have significant implications for financial stability and national security. Legal frameworks must therefore mandate stringent cybersecurity standards and allocate responsibility in cases of breach or service outage, especially when such incidents affect public trust and economic continuity. 5. Monetary Policy and Legal Autonomy CBDCs may also disrupt traditional monetary policy tools. For example, if the public begins to hold CBDCs instead of commercial bank deposits, it could reduce banks’ ability to lend, affecting credit creation. Legal questions about the role of central banks, the autonomy of monetary policy, and the permissible scope of direct financial intervention will arise. Legislatures must delineate clear mandates for central banks in a CBDC-driven economy. Conclusion The rise of Central Bank Digital Currencies marks a historic juncture in the evolution of money. However, alongside the potential benefits lie significant legal risks that cannot be ignored. For CBDCs to function effectively and equitably, a comprehensive legal framework is imperative—one that harmonizes innovation with constitutional rights, international cooperation with national sovereignty, and economic efficiency with legal accountability. As jurisdictions like India move forward with digital rupee pilots, the legal community must proactively engage in shaping policies and regulatory responses to ensure that the digital future of money is not only efficient but also just and secure.

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BRIBERY & CORRUPTION IN PUBLIC CONTRACTS: ARE INDIA’S LAWS TOUGH ENOUGH?

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INTRODUCTION Public procurement is governed by a web of legal frameworks in India, but the sector remains vulnerable to corrupt practices. From manipulated tenders to political favouritism, the problem lies not just in weak enforcement, but also in legislative loopholes. This carousel explores whether India’s legal architecture is robust enough to handle corruption in public contracts—or whether we need comprehensive legal reform. UNDERSTANDING THE LEGAL RISK IN PROCUREMENT Public procurement constitutes a major chunk of government expenditure, making it a prime target for unlawful gains. Bribery, bid rigging, and misuse of discretion plague every stage—from tender drafting to contract execution. Despite several vigilance bodies and statutory safeguards, loopholes remain. Corruption in this area not only erodes public trust but also violates constitutional principles such as equality and transparency under Article 14. The question is—are existing legal safeguards sufficient? THE PREVENTION OF CORRUPTION ACT, 1988 The Prevention of Corruption Act is the cornerstone legislation criminalizing bribery in public functions. Amended in 2018, it now penalizes both bribe-givers and bribe-takers, introduces corporate criminal liability, and mandates prior sanction for prosecution of public servants. However, critics argue that requiring sanction often delays or dilutes proceedings. Despite a strong legal outline, poor conviction rates and judicial delays have hampered the Act’s effectiveness in ensuring accountability in public procurement. THE MISSING PUBLIC PROCUREMENT LAW India lacks a comprehensive procurement law. The Public Procurement Bill, 2012, proposed transparency, fair bidding, and penalties for misconduct—but was never enacted. Instead, the General Financial Rules (GFRs) and departmental guidelines govern procurement today. These are executive instructions and lack the enforceability of a statute. The absence of a binding, central legislation leaves ample room for discretion, inconsistency, and corruption across different departments and states. STRUCTURAL GAPS IN ENFORCEMENT MECHANISMS Even where laws exist, enforcement often fails. Investigative agencies like the CBI face allegations of political misuse. Oversight bodies such as the Central Vigilance Commission have recommendatory—not punitive—powers. Delays in sanctioning prosecution, poor witness protection, and inadequate case tracking systems weaken the fight against corruption. Without institutional independence and judicial efficiency, even the most well-drafted legislation fails to translate into deterrence. GLOBAL LEGISLATIVE MODELS GLOBAL LEGISLATIVE MODELS India can take cues from global anti-bribery laws. The UK Bribery Act (2010) imposes strict liability on companies and mandates adequate procedures to prevent bribery. The US Foreign Corrupt Practices Act (FCPA) allows prosecution of American firms involved in foreign corruption. These laws prioritize corporate compliance and cross-border enforcement. India’s framework lacks clear mandates on due diligence, self-reporting, and whistleblower safeguards, making international benchmarking necessary. LEGAL REFORMS THAT CAN STRENGTHEN THE SYSTEM Legal experts have long called for reforms to strengthen integrity in public procurement. These include: CONCLUSION – A LEGAL IMPERATIVE The existing legal framework is foundational, but far from sufficient. Fragmented laws, weak enforcement, and absence of a central procurement statute create an ecosystem where corruption can persist unchecked. If India is serious about fiscal accountability and constitutional governance, it must legislate with precision and enforce with resolve. The solution is not just stricter laws—but smarter, more coherent legal systems that truly deter misconduct in public contracts.

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SUBSCRIBING TO TROUBLE? LEGAL CHALLENGES OF AUTO-RENEWAL IN INDIAN BUSINESS MODELS

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– Sukanya Joshi, Associate In recent years, subscription-based business models have become a cornerstone of modern commerce across sectors, including digital entertainment, software services, e-commerce, education, and personal care. These models promise convenience and predictability for both service providers and consumers. Central to this model is the auto-renewal clause—an agreement provision that enables seamless continuation of service by automatically renewing the consumer’s subscription at the end of each billing cycle. While beneficial in theory, these clauses pose significant legal risks in India, especially in light of evolving jurisprudence and consumer protection regimes. This article seeks to examine the legal implications of auto-renewal clauses in subscription contracts in India, dissecting their compatibility with statutory obligations, regulatory frameworks, and evolving consumer expectations. 1. The Anatomy of Auto-Renewal Clauses Auto-renewal clauses are contractual provisions that facilitate the automatic renewal of services for a subsequent term unless terminated by the consumer within a specified period. These clauses are typically drafted to favour . continuity and to minimize operational overheads linked to recurring customer acquisition. However, in the Indian legal context, such clauses must be carefully scrutinized for fairness, transparency, and compliance with regulatory mandates. Failure to do so may render these clauses unenforceable or expose businesses to penalties, class action suits, or reputational harm. 2. Statutory Framework in India Consumer Protection Act, 2019 The Consumer Protection Act, 2019 (CPA) is the primary legislation governing consumer rights and fair trade practices in India. It defines “unfair trade practices” to include deceptive and misleading methods, particularly in the offering and performance of services. An auto-renewal clause, if not clearly disclosed or explained, may fall within the ambit of an unfair contract term under Section 2(46) and Section 49 of the CPA. The Central Consumer Protection Authority (CCPA) is empowered to investigate and penalize such practices. Key legal implications include: Indian Contract Act, 1872 Under the Indian Contract Act, all agreements must be formed with free consent and mutual understanding. A one-sided auto-renewal clause that materially alters the rights or obligations of the consumer without fresh consent at the time of renewal may be interpreted as lacking mutuality, a core requirement of a valid contract. Moreover, Section 23 of the Contract Act renders any contract or clause void if it defeats the provisions of any law or is against public policy. Auto-renewal clauses that operate in a manner contrary to consumer interest or statutory safeguards could fall foul of this provision. 3. Regulatory Guidelines and Banking Norms The Reserve Bank of India (RBI) has played a pivotal role in shaping the operational framework for auto-renewals, especially those involving recurring payments on credit and debit cards. RBI Guidelines on e-Mandates (2021) Effective from October 1, 2021, the RBI mandated the following for recurring card-based transactions: Non-compliance with these regulations could lead to transaction failures, customer dissatisfaction, and enforcement action against the entity initiating such debits. 4. Risks and Legal Exposure for Businesses a. Violation of Consent Norms A key risk lies in the assumption of tacit consent. Many businesses opt users into auto-renewals by default, often buried deep within their terms and conditions. Indian courts and consumer forums have increasingly held that true consent must be free, informed, and affirmative. b. Data Protection and Privacy Concerns With the introduction of the Digital Personal Data Protection Act, 2023, the handling of personal financial data in auto-renewal systems must be in consonance with the principles of purpose limitation, transparency, and data minimization. The act imposes civil penalties for misuse or unauthorized processing of personal data. c. Regulatory and Financial Sanctions Businesses that fail to comply with RBI mandates risk being blacklisted by payment gateways or subject to penalties. Moreover, disruptions in transaction processing due to non-compliance may adversely impact cash flow and customer satisfaction. d. Litigation Risk Unsatisfied consumers may approach consumer dispute redressal commissions seeking refunds, damages, or injunctive relief against auto-renewals. Recent jurisprudence shows that courts are inclined to side with consumers where asymmetry of information or procedural unfairness is evident. 5. Judicial Interpretation Indian courts have traditionally adopted a consumer-centric approach when examining adhesion contracts—standard form agreements where consumers have limited scope for negotiation. For example, in L.I.C. of India v. Consumer Education and Research Centre (1995), the Supreme Court held that “unconscionable terms” in contracts offered on a “take it or leave it” basis are not binding. Applied to auto-renewal clauses, this principle would mean that if the renewal process lacks sufficient checks to ensure ongoing consent, the clause may be struck down. 6. Best Practices for Risk Mitigation Businesses operating in the subscription space must proactively structure their contracts and operational models to align with Indian legal standards. 1. Transparent Disclosure 2. Affirmative Consent 3. Cancellation Mechanism 4. Legal Review and Compliance 5. Audit and Record-Keeping 7. The Way Forward India’s legislative and regulatory ecosystem is evolving in tandem with its growing digital economy. Subscription-based businesses must view legal compliance not as a hurdle but as a cornerstone of sustainable growth. The auto-renewal model, while commercially attractive, must be implemented with fairness, clarity, and respect for consumer autonomy. By adhering to a compliance-first approach—grounded in transparency, consent, and accountability—enterprises can build resilient subscription models that withstand legal scrutiny and foster consumer trust. Conclusion In the Indian legal context, auto-renewal clauses in subscription-based business models carry significant legal baggage. From statutory compliance under the Consumer Protection Act and the Indian Contract Act, to strict RBI regulations and data protection norms, businesses must tread carefully. The cost of non-compliance is no longer limited to financial penalties; it now encompasses loss of goodwill, erosion of trust, and potential class actionliability. Therefore, businesses that rely on recurring revenue streams must not only invest in robust technological systems but also embed legal foresight into their operational DNA. Ultimately, respecting the rights of consumers is not just a legal obligation—it is a business imperative.

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Investor-State Dispute Settlement (ISDS): Should India Reconsider Its Position?

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Introduction Investor-State Dispute Settlement (ISDS) has become one of the most debated mechanisms in international investment law. It allows foreign investors to bring claims directly against host states for alleged violations of investment agreements. While proponents argue that ISDS protects investors from arbitrary state actions, critics highlight its potential to undermine national sovereignty and democratic processes. India, once a supporter of ISDS, has taken a cautious stance in recent years, opting to terminate several Bilateral Investment Treaties (BITs) and introducing a new model BIT in 2016. This essay examines whether India should reconsider its current position on ISDS, analyzing both the rationale behind its shift and the implications for future foreign investment. India’s Evolving Stance on ISDS India’s changing approach to ISDS is rooted in its experience with several high-profile cases. The White Industries case in 2011 marked a turning point. The Australian mining company successfully sued India under the India-Australia BIT, invoking the Most Favoured Nation (MFN) clause to benefit from more favorable provisions in India’s BIT with Kuwait. This case, and subsequent others, exposed India to unexpected legal and financial liabilities and prompted a reassessment of its BIT framework. In response, India drafted a new Model BIT in 2016, significantly narrowing the scope for ISDS. It limits investors’ rights to sue the state, requires exhaustion of local remedies for five years before initiating international arbitration, and restricts provisions such as the MFN and Fair and Equitable Treatment (FET) clauses. Moreover, India began terminating or renegotiating older BITs based on this model. Arguments Supporting India’s Cautious Approach India’s new stance is driven by legitimate concerns. First, the ISDS mechanism can infringe on a state’s regulatory autonomy. Developing countries like India need policy space to pursue economic, environmental, and social objectives. The fear of costly litigation and investor retaliation can result in “regulatory chill,” deterring governments from implementing legitimate public interest regulations. Second, ISDS has been criticized for its lack of transparency and consistency. Arbitral tribunals are often composed of private lawyers without accountability, and awards can be inconsistent, leading to unpredictability in outcomes. For a country with a complex and evolving legal framework like India, such uncertainty can be risky. Third, the financial burden of defending ISDS cases is significant. Legal costs can run into millions of dollars, even when the state prevails. For a developing country with limited public resources, this is a substantial concern. The Case for Reconsideration Despite these concerns, a complete retreat from ISDS may not serve India’s long-term interests. Foreign investors typically seek legal certainty and enforceable dispute resolution mechanisms. India’s restrictive model BIT may deter investment, especially in capital-intensive sectors like infrastructure and energy, where long-term commitments require strong legal protections. Moreover, India aspires to become a global manufacturing and investment hub under initiatives like “Make in India.” Competing economies such as Vietnam, Indonesia, and the UAE offer more investor-friendly dispute settlement mechanisms. By opting out of ISDS, India risks losing its competitive edge in attracting FDI. Instead of outright rejection, India could adopt a balanced approach by reforming rather than eliminating ISDS. This includes supporting multilateral efforts like the UNCITRAL Working Group III on ISDS reform, which aims to address concerns around transparency, independence, and coherence in arbitration. India could also consider incorporating mediation and state-to-state dispute mechanisms as alternatives to traditional ISDS. Conclusion India’s cautious approach to ISDS reflects valid concerns about sovereignty, legal uncertainty, and financial exposure. However, in an increasingly globalized economy where investor confidence is crucial, an overly restrictive stance may hinder India’s economic ambitions. A middle path—one that safeguards sovereign rights while providing credible legal protections to investors—might be the most pragmatic course. By engaging in international reform efforts and crafting balanced BITs, India can create a more stable and investor-friendly environment without compromising its national interests.

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BNPL (BUY NOW, PAY LATER) MODELS: ARE THEY LEGALLY SUSTAINABLE?

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INTRODUCTION Buy Now, Pay Later (BNPL) has rapidly gained traction in India, offering instant credit without traditional banking hassles. It allows consumers to purchase goods and pay later in installments, often without interest. However, as BNPL platforms operate outside conventional lending frameworks, concerns around regulatory compliance, consumer protection, and financial stability are growing. HOW BNPL WORKS BNPL enables consumers to make purchases immediately and pay later in flexible installments. Unlike credit cards, it requires minimal documentation and offers quick approvals. BNPL providers typically partner with merchants, acting as intermediaries between consumers and financial institutions. However, many operate in regulatory grey areas, raising concerns about financial risks, consumer data security, and the absence of clear legal oversight. RBI’S PERSPECTIVE ON BNPL The Reserve Bank of India (RBI) has taken a cautious stance on BNPL’s rapid expansion. In 2022, it restricted the use of prepaid payment instruments (PPIs) for credit lines, affecting several BNPL firms. RBI views BNPL as a credit product that must adhere to digital lending norms, requiring providers to be regulated entities. The central bank is particularly concerned about unregulated lending, growing defaults, and consumer protection. It is now moving towards enforcing stricter compliance measures within India’s financial ecosystem. KEY LEGAL CHALLENGES Despite its benefits, BNPL faces several legal and regulatory hurdles: IMPACT ON CONSUMERS BNPL offers convenience but comes with financial risks: GLOBAL BNPL REGULATIONS COMPLIANCE & FUTURE REGULATIONS For BNPL to remain viable in India, providers must strengthen compliance by: Regulatory oversight will enhance consumer trust and long-term industry sustainability. THE FUTURE OF BNPL IN INDIA BNPL is at a crossroads—while stricter regulations are inevitable, they could also legitimize and strengthen the sector. Responsible lending, financial literacy, and compliance with RBI norms will be crucial. Fintech firms that adapt to regulatory changes can thrive, while non-compliant players may face legal roadblocks and market disruptions. The future of BNPL in India will depend on how well companies balance innovation with regulatory obligations.

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