India Business Law Journal –  March 2020

A perfect storm

The inevitable has happened

A previously unknown virus has jumped the species barrier from animal to human, and despite the public health community sounding the alarm for some time about just such a danger, the world has been caught off guard. Not only has COVID-19 demonstrated once again humankind’s vulnerability to disease, but speeding along the air routes of a globalized world it has spread mayhem across nations, corporate edifices, the courts and more.

How long can this continue? There is little knowing, but this is clear: there is nothing to be gained by quibbling about the provenance of the current virus, or attempting to evade the measures being put in place to rein it in. In time the virus will run out of steam and life will return to some degree of normality, but what happens in the interim?

This month’s Cover story explores how employers can minimize risks for employees and ensure business continuity during the time of the coronavirus. It also assesses the unique legal issues posed by the pandemic. For example, an employee who caught the virus on a business trip should be treated as if he or she had been injured at work. As such, the employer would be required to compensate the employee if confronted with such a situation.

As the economic situation deteriorates such directives may become difficult to implement, but will need to be if we are to emerge from this crisis with our humanity intact. The outbreak of COVID-19 is impacting human lives, businesses, deliveries and services. But once it is over, there will be abundant lessons for the global community, which it is hoped will help people, organizations and governments to better handle any future situation such as this.

The ramifications of COVID-19 are far reaching and have even affected the workings of the Indian Patent Office, which has been forced to relax some of the strict timelines for patent applicants. Writing in this month’s Vantage point, Raj Davé, a professor at Gujarat National Law University, argues that this increased flexibility should be permanent, and that it should not have required a pandemic to institute such an approach. Davé argues that many factors can cause unintentional delays to patent filings, and that penalizing the applicant for such delays diminishes the number of filings, and ultimately harms the economy.

In this month’s What’s the deal?, we examine the rights of homebuyers in light of the enactment of the Insolvency and Bankruptcy Code (IBC), 2016, and the Real Estate (Regulation and Development) Act (RERA), 2016, and ask what they should do if they find themselves in disputes with developers. While provisions in the IBC that accord financial creditor status to homebuyers are certainly welcome, our analysis finds that the RERA is the best route for homebuyers seeking to recover funds.

In this month’s Spotlight – Shining a light on unsafe practices – Nitin Mittal, general counsel at Signify Innovation, reveals that poor enforcement of Bureau of Indian Standards norms has encouraged sham manufacturers to put unsafe products on the market. This was demonstrated in a 2019 Nielsen study on lighting products, where 52% of the LED downlights and 47% of the LED lamps were non-compliant with mandatory safety norms. Mittal argues that the lackadaisical approach of the government towards enforcing the law discourages compliance. Both of the concerned regulators, the Ministry of Electronics and Information Technology and the Bureau of Indian Standards, recognize the need for ground-level enforcement and are aware of the current situation, but have demonstrated helplessness in organizing large-scale raids in key markets. This not only allows spurious manufacturers to get away with selling potentially unsafe products, it also penalizes the companies that do adhere to relevant standards, as their products tend to be more expensive due to the additional cost of compliance. The only solution is the stronger enforcement of existing laws. This will promote innovation, create a level playing field and build confidence in the quality of Indian products.

This month’s Intelligence report analyses progress made on the gender equality front, as seen from the perspective of the in-house community. The prevailing view, as expressed by one leading general counsel, is that companies “have evolved to a greater level of gender inclusion and are focusing on creating the right environment and policies to support this”.

Certainly this is encouraging news, but has it changed the situation on the ground? Aparna Mittal, founder of Samāna Centre for Gender, Policy and Law, is not sure it has, as there is no specific data as yet on diversity. Even if there is numeric diversity, that may not be enough to suggest that real inclusion is happening. Yet, there is evidence that women today do have a seat at the table and career growth is merit-based.

Many of the female in-house counsel who expressed their views in our coverage clearly demonstrated resilience and the ability to overcome challenges. In the current situation, this is surely what all of us need right now. Stay safe and stay healthy!