Ban of 59 mobile applications: its implications & effect on related business

The scheming claims of all business on 29^th June 2020 centered about the block of 59 applications which were said to be in activities which were prejudicial to sovereignty and integrity of India, defence of India, the security of the state, and public order. The list included popular mobile applications like Tik Tok, Mi Video Call – Xiaomi, We Chat, and the most popular Cam Scanner.

Let me reproduce the actual press release. (Press Information Bureau, Government of India.

https://taxguru.in/corporate-law/government-bans-59-mobile-apps-check-list.html

Let us discuss its economic implications, social effects and above all its mindful shocks to the younger generations which made them a world force to reckon with.

Let us reproduce the logical order of the Government arguments:

• The Ministry of Information Technology, invoking its power under section 69A of Information Technology Act read with the relevant provisions of the Information Technology (Procedure and Safeguards for Blocking of Access on Information by Public) Rules 2009 and in view of the emergent threats decided to block 59 apps.
• Their line of argument runs to emphasize that the apps were engaged in activities which were prejudicial to sovereignty and integrity of India, defence of India, the security of state and public order.
• The communique further added that due to receipt of several complaints from various sources including several reports about misuse of some mobile apps available on Android and iOS platforms for stealing and surreptitiously transmitting user’s data in an unauthorized manner to servers located outside India action was initiated.
• The above acts needed immediate action in its view and hence the urgent action that resulted in the suspension of apps.
• We are further informed that The Indian Cyber Crime Coordination Center, Ministry of Home Affairs had also sent an exhaustive recommendation to ban these malicious apps.
• Others like the representations from citizens, Members of Parliament from both the Houses, The Computer Emergency Response Team (CERT-UN), and other organizations also demanded strict action against the apps which harmed the national sovereignty and privacy of the citizens.
• The ultimate goal is to safeguard the interests of internet and mobile users.

This two-page communique gave an appendix which contained the names of 59 apps.

Let us narrate the names of the apps which attracted the national attention, learnt to be covering nearly 200 million users – a mind boggling figure.

“Tik Tok, Club Factory, Newsdog, Bautry Plus, We Chat, UC News, QQ Mail, Weibo, Xender, QQ Music, QQ Newsfeed, Bigo Live, Selfie City, Mail Master, Parallel Space, Shareit, Kwai, U C Browser, Baidu Map, Shein, Clash of Kings, DU Battery saver, Helo, Likee, You Cam Makeup, Mi Community, CM Browers, Virus Cleaner, APUS Browser, ROMWE,

Mi Video Call – Xiaomi, WeSync, ES File Explorer, Viva Video – QU Video Inc, Meitu, Vigo Video, New Video Status, DU Recorder, Vault- Hide, Cache Cleaner DU App studio,

DU Cleaner, DU Browser, Hago Play With New Friends, Cam Scanner, Clean Master – Cheetah Mobile, Wonder Camera, Photo Wonder, QQ Player, We Meet, Sweet Selfie,

Baidu Translate, Vmate, QQ International, QQ Security Center, QQ Launcher, U Video, V fly Status Video, Mobile Legends, DU Privacy”

Views on the above developments

As a sovereign democratic nation with nearly 130 crores of the population who elect their own representatives to rule their country which is by and large rules-based and one of the most heterogeneous societies one can ever imagine, whatever action initiated by the Government of India has been welcomed by its people. Being the young capital of the world, the loss of nearly 120 million or more viewers from India for any industrial nation like China, is an immeasurable loss, and the vacuum created may take some time to be filled in.

The following item from Indian Express dated July 1, 2020, is worthy of consideration:

“Over 2015-19, Chinese investors including Alibaba, Tencent, TR Capital, and Hillhouse Capital, have invested over $5.5 billion in Indian start-ups, according to Venture Intelligence that tracks private equity, venture capital, M&A transactions, and valuations, in India.”

For an Economist, the above news item would be worthy of consideration and he/she may have their opinion on the huge economic loss of capital, labor of thousands of artists, domain experts, engineering graduates who gained immensely by use of the latest technologies introduced by the Chinese companies and the creativity unleashed by the combined power of millions of multi-racial population.

For an Insolvency Professional like myself, due to judicial requirements that vary from state to state in India, Cam Scanner occupies a space that can’t be replaced by any other app immediately. For India which still lingers on with the legacy left by British, these new apps opened up new areas of usage, some times that were unimaginable before their arrival.

Legal position of the central government

Information Technology Act 2000, section 69A reads as under:

“69A. Power to issue directions for blocking for public access of any information through any computer resource.–(1) Where the Central Government or any of its officers specially authorized by it in this behalf is satisfied that it is necessary or expedient so to do, in the interest of sovereignty and integrity of India, defence of India, the security of the State, friendly relations with foreign states or public order or for preventing incitement to the commission of any cognizable offense relating to above, it may subject to the provisions of sub-section (2), for reasons to be recorded in writing, by order, direct any agency of the Government or intermediary to block for access by the public or cause to be blocked for access by the public any information generated, transmitted, received, stored or hosted in any computer resource. (2) The procedure and safeguards subject to which such blocking for access by the public may be carried out, shall be such as may be prescribed. (3) The intermediary who fails to comply with the direction issued under sub-section (1) shall be punished with imprisonment for a term which may extend to seven years and also be liable to fine.”

Let us understand its simplicity in an application for the ban imposed on 59 apps.

• The power can be exercised through any computer resource with the reasoning that Central government or any of its officers specially authorized to act on its behalf, also with the clear satisfaction to take appropriate steps feel the necessity to take action.
• Can an action be taken as is done in a Communist or autocratic nation with virtual disregard for its rules and regulations? The act clearly explains that action taken has to be in writing, by order, with reasons to be recorded again in writing, and block any information generated, transmitted, received, stored or hosted in any computer resource.
• The procedure to be adopted is to be described in writing and duly followed.
• Next, the valid question arises in our minds. What would happen if in spite of assessing the damage to the nation and deciding to take action, nothing happens?
• The intermediary who fails to comply with the direction issued under sub-section (1) shall be punished with imprisonment for a term which may extend to seven years and also be liable to fine. Let us presume, agencies like Google or Apple or anyone who is capable of allowing the downloading of the apps would face the punishment if no action is taken.

Conclusion

In history, situations like the banning of popular apps, who are themselves innovations of the most modern generations to meet unlimited ambitions of modern civilization, do happen. As explained earlier, nearly $10 billion dollars were invested to develop the Indian market with the clear goal of matching up to the world’s standards in the internet or mobile applications. So far, U.S.A. took the lead and others just obeyed its directions. But the youngest generations of India/China or any Asian nation can shake the whole world with modern technology. Like any Asian, I only wish that these developments do not reach the hands of dictators, subject themselves to modern laws but do benefit the modern generations of human civilization who may lead us from darkness to enlightenment.

Let me conclude with the apt desire, the best is yet to come in the world.