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Public Policy
Monthly Mailer |
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| October 2024 |
Vol 6, Issue 10 |
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| Safe Harbour | Nasscom-Deloitte Report on Indian Safe Harbour Regime |
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India has emerged as a significant hub for innovation and R&D, with Global Capability Centers (GCCs) playing a crucial role in driving technological advancement and business transformation. These GCCs, operating under transfer pricing regulations as related parties to global entities, face challenges in maintaining competitive profit margins. Achieving transfer pricing parity with other countries through optimised Safe Harbour rules could further enhance its attractiveness.
Based on nasscom's recommendations, the finance minister made an announcement in Budget 2024 to expand the scope of safe harbour rules and streamline the transfer pricing assessment procedures. Nasscom is now engaged with the government and the industry on operationalising the budget announcement.
As part of this, we are working on two detailed reports, analysing the safe harbour provisions and the advance pricing agreements. The report on safe harbour covering an in-depth analysis of challenges and the global landscape has been submitted to the Ministry of Finance (Report). The second report, carrying out a detailed analysis on the Advance Pricing Agreements is expected to be finalised within November 2024. For more information, please reach out to tejasvi@nasscom.in. |
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| MOCI | Representation on continuation of hybrid work model |
| Based on detailed consultation with the industry and their feedback, we find that different hybrid work models are being followed by industry depending on the nature of the work. While there is a increasing level of work from office, the hybrid working model provides the requisite flexibility. It is also important to ensure there is no unintentional differences in the flexibility available in terms hybrid working in the SEZ vis a vis the domestic tariff area, as that could seriously undermine the ease of doing business and efficiency for the industry that operates in both the zones. We have made a representation to the MOCI to consider the hybrid working model as a long-term feature of the SEZs to enable ease of doing business and to promote ease of living. (Read more) |
| MEITY | Import Policy of Laptops, Tablets, all-in-one personal computers, ultra small form factor computers and servers |
| While the DGFT has extended import authorisation of the above items till December 31, 2024, we understand that MEITY is in the process of providing the future roadmap on this, to the industry. We have submitted to the government to gauge the scale of manufacturing of the above-listed items in the country, and not just the scale of imports, while framing the future roadmap. We understand from MEITY that they are cognizant of the fact that industry would need adequate time to plan for any policy adjustments, if any. For more information, please reach out to vertika@nasscom.in. |
| MoLE | Streamlining EPFO processes |
| Building upon our earlier interaction with EPFO, we have submitted a representation to highlight various challenges faced by the IT sector in navigating EPFO processes. These include operational challenges caused by the implementation of OTP authentication, complications in transferring PF accounts, especially for employees moving from exempted to unexempted establishments, and discrepancies in tracking NCP for employees on foreign deputations. The representation also notes the concerns on mismatches in EPS status across different employments and the financial burden posed by interest payments on unsettled PF accounts. Through this engagement, nasscom aims to facilitate smoother processes within EPFO and address industry's operational challenges with practical, collaborative solutions. For more information, please write to swapnil@nasscom.in. |
| MIB | Broadcasting Services (Regulation) Bill, 2023 |
| Building upon our earlier feedback, we submitted our response to MIB's latest call for inputs on the Draft Broadcasting Bill. In this representation, we analysed the arguments in favour of creating a level playing field between OTT video services and traditional broadcasting services. We noted that calls for addressing the regulatory and content disparity between different viewing mediums have not been substantiated to account for their distinctions and complementary nature. Our analysis suggested that without considering the nuances of OTT sector, a pivot from existing regulatory framework to create a level playing field can have severe unintended consequences. (Read more). |
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| TRAI | Counter Comments on TCCCPR Consultation Paper |
| Some stakeholders in their response to TRAI's Consultation Paper on the Review of the TCCCPR, 2018 had stated that OTT services - particularly OTT communication platforms, be brought within the purview of the TCCCPR. To state the correct regulatory position and industry practices, we submitted our comments to TRAI to clarify that first, TCCCPR is not applicable to OTTs and second, OTTs have strong in-built technical measures to address spam, many of which do not feature in traditional telecom-based voice calls and SMS. For more information, please write to policy@nasscom.in |
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| UP Government | AI Policy |
| Nasscom gave feedback on the recent draft UP AI policy, 2024 which intends to establish UP as a premier hub for AI, attract global investments and foster innovation to create a positive social impact in the state. We suggested that the policy needs to clearly bring out the value proposition to differentiate UP from other states. Further, the policy should first focus on existing IT hubs like Noida and develop them as AI clusters. We also suggested that the policy should avoid domiciliary conditions like locating majority of operations in UP, which could possibly discourage industry participation. Finally, once the policy is finalised, a detailed implementation roadmap should be put in place in consultation with the industry. For more information, please write to sudipto@nasscom.in. |
| UP Government | Feedback on Draft GCC Policy |
| The UP Government had sought inputs on the draft GCC Policy for the state. Nasscom appreciated that the draft policy covered all the aspects of talent, infrastructure, ecosystem, fiscal benefits and business environment. We made some suggestions on revising the definition of GCC, timely clearances of applications, strengthening IP framework, setting up grievance redressal mechanism for the industry and setting up an advisory committee to monitor implementation of the policy. For more information, please reach out to vertika@nasscom.in. |
| Karnataka Government | Review of the Covid Mandates |
| Given constant decline in active cases of COVID-19 not only in India but across the world, we represented to the State Health and Family Welfare department requesting them to withdraw/review existing guidelines that mandate daily temperature checks, face masks, and entry only for vaccinated employees. In the past, nasscom has reached out to various state governments and highlighted that delay in withdrawal of such Covid mandates, which are no longer relevant, is a huge implementation and compliance concern for the industry. For more information, please write to sudipto@nasscom.in. |
| Karnataka Government | Labour and Employment |
| We represented to the state government seeking a clarification with respect to daily working hours in the recent notification issued in September 2024, that renews exemption for certain types of establishments in the state of Karnataka, allowing them to operate on 24*7 basis. |
| Haryana Government | Labour and Employment |
| We submitted a representation to the government of Haryana highlighting certain ease of doing business concerns faced by IT/ITeS organisations operating in the state. Our endeavour is to develop consistent collaboration with the state government to build a bespoke regulatory approach that is flexible and adaptive to suit sectoral needs and aspirations. |
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| MEITY & NeGD | Workshop on Implementing the DPDP Act |
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| As India prepares to operationalise and implement the DPDPA, developing understanding on the practical aspects of data protection framework is becoming crucial for both public and private sector. To develop this understanding, MEITY and NeGD organised a workshop on 'Building a Culture of Data Protection' as a knowledge building session for government officials and industry stakeholders. At the event, Ashish Aggarwal spoke about the need for companies to champion privacy and data protection, role model compliances and benchmark good practices for the entire industry. This would be crucial for meeting the objectives of the law, as the DPDPA relies more on proactive compliances and on users and citizen groups raising complaints, than active enforcement by the Government, to address gaps. |
| Indo-US ICT Working Group | Meeting on Cooperation in Electronics & IT Sector |
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| The Indo-US Joint Working on ICT was established in 2005 as a joint platform for government and industry from both countries to discuss cooperation in the Electronics & IT sector. nasscom participated in the latest meeting of the Joint Working Group, which was held in New Delhi on October 17, 2024. Speaking at the meeting, Ashish Aggarwal highlighted the need to encourage international data transfer frameworks that recognise possibilities of different approaches across countries to achieve shared data protection and privacy objectives. He made the case for a deeper joint exploration of the developments in the Global CBPR Forum by India and the US and to examine the CBPR as one of the frameworks for facilitating interoperability of data protection initiatives in the global context. |
| Koan Advisory | Roundtable on Exploring Indian Perspectives on Cloud Sovereignty |
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| Given the increasing global demand for cloud sovereignty, nasscom participated in a roundtable held in Delhi to discuss and explore the Indian perspectives on this subject. Useful discussions took place on the concepts of cloud sovereignty and identification of use-cases. Speaking at the roundtable, Sudipto Banerjee highlighted the industry’s role in exhibiting technology as a potent tool towards meeting the objective of cloud sovereignty. For more information, please write to sudipto@nasscom.in. |
| Dark Patterns | Nasscom-ASCI Masterclass on Ethical Design Practices |
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| Continuing our collaboration with ASCI and Parallel on promoting ethical design practices, we organised a masterclass at the 21st edition of 'Nasscom Future Forge' on October 16 in Bangalore. The masterclass presented simple, practical steps to equip creators, designers, and product leaders with tools to drive ethical innovation. Through hands-on exercises and real-world examples, the masterclass showcased how thoughtful design choices can foster user trust, create long-term value, and positively reshape brand identities. |
| Industry | Webinar on Hybrid Work Policy for IT/ITES in SEZ |
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| A webinar on the subject was organised by PwC to delve into the nuances of the SEZ work-from-home guidelines, their impending expiration, and the potential implications for SEZ units and employees. During the webinar, Vertika Misra highlighted that hybrid work models have enabled the industry to swiftly pivot operations in response to global disruptions, ensuring business continuity and client satisfaction. Varied hybrid practices have been adopted by the companies, which have resulted in flexibility, diversity, inclusion, talent retention and sustainability. Nasscom has thus requested the government to consider this model to be a long-term feature of the SEZs to enable ease of doing business and to promote ease of living. |
| MoF | Applicability of GST for Passenger Transportation Services |
On October 14, CBIC organised a meeting to discuss concerns of ECOs regarding liability under S. 9(5) of CGST Act. During the meeting, Nasscom asked for clarity on the applicability of S. 9(5) for different business models. We also requested CBIC to identify characteristics based on which such differentiation could be considered from a tax treatment perspective.
Post our meeting, we have written to CBIC to highlight that the varying interpretations offered through different advance rulings regarding the taxability of transportation services has created uncertainty as to how these rulings can be understood at any industry level, making it challenging to plan future operations with any degree of tax certainty, particularly at a pan India level. We have requested the CBIC to evaluate:
- The feasibility of implementing provisions of S. 9(5) of CGST Act, and consider, how can the ECO discharge the liability under S. 9(5) if it does not even have the ability to collect the ride fare, as part of its operating model?
- The effect of the tax policy, so that it is holistic and does not distort the market. In case where an ECO is providing additional set of services to the rider and has built its operating model and invested in infrastructure to support the same - should such an ECO be made liable under S. 9(5), leading to the model being seen as less attractive to the drivers and riders - purely on account of the GST?
For more information, please reach out to tejasvi@nasscom.in. |
| NTIPRIT/ DoT | Meeting to discuss NDCP suggestions |
Post submission of our preliminary comments on the proposed NDCP, NTIPRIT, who is steering the work on NDCP, invited nasscom for an interaction to present our views. Senior officials of NTIPRIT attended the meeting which included DDG (ICT), DDG (WA) and DDG (TS&PR). Nasscom reiterated its position that NDCP, 2024 should acknowledge the diverse landscape of emerging digital communications, each with unique attributes, business models, and risks.
We had useful discussions on the proposed design of NDCP, 2024 which included liberalising regulatory framework on access to dark fibre, captive use authorisation, and PSTN-IP switching, providing clarity and confidence to start-ups and MSMEs by recognising regulatory position of HCCSP and Audiotex, etc. Further, our feedback that NDCP should have an in-built review mechanism was duly acknowledged. Nasscom would continue engaging with NTIPRIT and DOT for any such policy formulation exercises. (Read more) |
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| TRAI | Consultation Paper on the Terms and Conditions of Network Authorisation to be Granted under the Telecommunications Act, 2023 |
| Pursuant to DOT's reference, TRAI has initiated a consultation to solicit stakeholders' comments on the issues terms and conditions, including fees or charges, for authorisation to establish, operate, maintain or expand telecommunication network under the Telecommunications Act, 2023. The last date for submission of feedback is November 12, 2024. (Read More) |
| SEBI | Consultation Paper on Draft Circular on Recognition as Specified Digital Platform |
| Nasscom is seeking inputs on the recent draft circular released by SEBI. The draft circular lays down several preventive and curative measures which need to be implemented by digital platforms to qualify as a 'Specified Digital Platform'. Please send your written inputs to nalini@nasscom.in and ananya@nasscom.in before 10th November 2024. (Read More) |
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| ASCI |
The Advertising Standards Council of India |
| CBIC |
Central Board of Indirect Taxes and Customs |
| CBPR |
Cross Border Privacy Rules |
| CGST |
Central Goods and Services Tax |
| CDN |
Content Delivery Network |
| DGFT |
Directorate General of Foreign Trade |
| DPDPA |
Digital Personal Data Protection Act, 2023 (India) |
| DoT |
Department of Telecommunication |
| ECO |
Electronic Commerce Operators |
| EPFO |
Employees' Provident Fund Organisation |
| EPS |
Employees' Pension Scheme |
| GCC |
Global Capability Centre |
| GST |
Goods and Services Tax |
| GSTN |
Goods and Services Tax Network |
| HCCSP |
Hosted Contact Center Service Providers |
| IP |
Intellectual Property |
| IMS |
Invoice Management System |
| IXP |
Internet Exchange Point |
| KPO |
Knowledge Process Outsourcing |
| MEA |
Ministry of External Affairs |
| MEITY |
Ministry of Electronics and Information Technology |
| MHA |
Ministry of Home Affairs |
| MoCI |
Ministry of Commerce and Industry |
| MoF |
Ministry of Finance |
| MoLE |
Ministry of Labour and Employment |
| MSME |
Micro Small and Medium Enterprise |
| NCP |
Non-Contributory Periods |
| NDCP |
National Digital Communications Policy |
| NeGD |
National e-Governance Division |
| NPCI |
National Payments Corporation of India |
| NTIPRIT |
National Telecommunications Insitute for Policy, Research, Innovation and Training |
| ONDC |
Open Network for Digital Commerce |
| OTT |
Over-the-top |
| PET |
Privacy Enhancing Technologies |
| PFRDA |
Pension Fund Regulatory and Development Authority |
| PSTN-IP |
Public Switched Telephone Network-Internet Protocol |
| RBI |
Reserve Bank of India |
| SEBI |
Securities and Exchange Board of India |
| TCCCPR |
Telecom Commercial Communications Customer Preference Regulations 2018 |
| TRAI |
Telecom Regulatory Authority of India |
| WTO |
World Trade Organisation |
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| www.nasscom.in |
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