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Bar & Bench will bring to you the latest regulatory and policy updates from different ministries and regulatory authorities. In this edition of Bar & Bench Regulatory Updates, we analyse the latest Press note issued by the DIPP, the Geospatial Information Regulation Bill, 2016 & more.
Government released Draft Bill for regulating Geospatial Information
Last week, the Government released the draft “Geospatial Information Regulation Bill, 2016” (Draft Bill) which aims at regulating maps being shared by companies such as Google and Apple. The Draft Bill has certainly crossed the line evoking severe criticism from internet activists. While the objective of the Government may have been noble, the Draft Bill contains provisions which can be termed as ‘unreasonable’ to many.
This will have a negative impact on a wide range of operators providing location based services such as Ola, Whatsapp, AirBnb, Zomato making it extremely difficult for them to operate.
Practical difficulties may creep in here because global players won’t always want to take a licence or subject themselves to India’s jurisdiction.
Cyber Law expert Pavan Duggal points out a number of drawbacks and loopholes:
As Karnika Seth points out, a solution to the dilemma could be a model wherein there are pre-approved government templates available freely for public use.
RBI gives in-principle approval for implementation of UPI
What is UPI?
UPI is a way (payment method) to transfer money between 2 parties without having to go through the hassle of registering a beneficiary under the existing NEFT or RTGS payment methods, thus eliminating the need to share sensitive information such as bank account numbers. Essentially, it is an improved version of Immediate Payment Service (IMPS) which will allow people to receive money and initiate requests too, as opposed to only making payments. Among other features:
However, the UPI cannot be thought of as a replacement for netbanking, as UPI does only one thing – money transfer. For other facilities, customers will still have to rely on netbanking.
Government notifies 100% FDI in Asset Reconstruction Companies
The Department of Industrial Policy and Promotion has notified 100% Foreign Direct Investment (FDI) under the automatic route in Asset Reconstruction Companies (ARCs) following the announcement made by the Finance Minister during his Budget speech earlier this year. The move comes at a time when there is a sharp rise in the stressed assets in the Indian economy.
Further FDI in ARCs will provide the much needed impetus to tackle the increasing amount of stressed assets (which include gross bad loans, restructured assets and written-off accounts) which rose to 14.5 %, as of 31 December 2015, as compared to 9.8% in March 2012.
“As the stressed-asset market heats up here (in India), international funds may look at various entry points to invest in such areas. This includes the ARC route which is one of the more important ways of stress resolution in India. With ARCs they may get a chance to invest in small and mid-sized cases, something which they would not have been able to do directly“, said the chief executive of an ARC, seeking anonymity.
Earlier, FDI up to 49% in ARCs was allowed through automatic route, and beyond that with the approval of the Foreign Investment Promotion Board.
While Foreign Institutional Investors (FIIs)/ Foreign Portfolio Investors (FPIs) were allowed to invest up to 74% in the security receipts issued by ARCs registered with the RBI, the limit has now been increased to 100%. However, the condition that the total shareholding of an individual FII/FPI should remain below 10% of the total paid-up capital remains.