The new Digital Data Protection Bill drafted by the Centre will impose severe penalties for breaches of personal data. According to government sources, if the ‘data processor’ or ‘data fiduciary’ fails to adopt appropriate security controls to prevent personal data leaks, a penalty of up to 250 crores can be applied.
After abandoning the earlier Personal Data Protection Bill 2019 during the monsoon session of parliament this year, the Centre is working on a new draft of the planned Digital Data Protection Bill. The 2019 draft bill proposed a penalty of 15 crores or 4% of an entity’s global turnover.
According to insiders, the government is considering including harsh penalties in the proposed new draft Digital Data Protection Bill to regulate social media. Failure to comply with other articles of legislation might result in a penalty ranging from 10,000 to 200 crore, depending on the extent of the non-compliance.
The new draft Digital Data Protection Bill proposes establishing a Data Protection Board of India to administer and enforce the proposed new Act’s provisions.
Penalties
If the Board determines at the conclusion of an inquiry that a person’s noncompliance is significant, it may, after giving the person a reasonable opportunity to be heard, impose such a financial penalty as specified in Schedule 1, not exceeding Rs 500 crore in each instance, according to the draft.
The draft proposes a graduated punishment scheme for data fiduciaries who process the personal data of data owners exclusively in line with the Act’s rules. Further, the data processor, which will be an entity that processes data on behalf of the data fiduciary, will face the same sanctions.
The draft is now public and will be available for public discussion until December 17.
Justifications
According to Rajeev Chandrasekhar, Minister of State for Electronics and Information Technology (IT), the proposed Digital Data Protection Bill will put an end to the misuse of client data, and violators will face disciplinary action under the rule.
The minister made the statement in response to Google’s settlement of a probe in the United States, which discovered that the internet giant misled customers and continued tracking their whereabouts even after they opted out of location tracking system.
The administration withdrew the Personal Data Protection Bill from Lok Sabha in August, saying it would replace it with “new legislation” that would fit into the overall legal framework.
Union telecom and information technology minister Ashwini Vaishnaw stated that the joint parliamentary committee that reviewed the original draft proposed 88 amendments to Digital Data Protection Bill with 91 sections, leading the government to decide that there was “no option” but to withdraw the original bill completely.
He also stated that many developments had occurred during the Covid pandemic. These resulted in newer learnings that need to be there in the rules. According to government sources, the new data protection measure will be rolling on at the winter session of parliament.
Reactions on Digital Data Protection Bill
According to the non-profit Internet Freedom Foundation (IFF), the Digital Data Protection Bill 2021 provides significant exemptions to government agencies, prioritizes the interests of huge corporations, and fails to fully protect people’s fundamental right to privacy.
The US-based ITI, whose members include all major technology companies such as Google, Meta, and Amazon, applauded the government’s decision to remove the Digital Data Protection Bill’s parliamentary panel version.
ITI was one of the global industry organizations that rejected the Digital Data Protection Bill’s joint committee version. JEITA, TechUK, US India Business Council, and Business Europe are among the global industry associations that represent thousands of companies and technology titans such as Google, Amazon, Cisco, Dell, SoftBank, and Microsoft.
A dozen industry organizations had written to Vaishnaw, claiming that enacting the Draft Digital Data Protection Bill, as suggested by a legislative panel, would considerably harm India’s economic environment and restrict foreign investment inflows.
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