Regulation of Content on OTT Platforms A Work-In-Progress

There needs to be a complete industry bind for the success of the self-regulation mechanism...

April 2020 marked the start of a very important transition period when, NBC Universal, which was already reeling under an indefinite postponement of the Fast & Furious franchise, took a risk and released the "Trolls World Tour" movie online before exhibiting it in theaters. The movie, offered at a rental price of US$ 20 for 48 hours, made US$ 20 million, leading NBC Universal executives to announce that they would release two of their upcoming movies on online platforms. Several Bollywood movies such as GulaboSitabo, Shakuntala Devi, DilBechara, amongst others followed the same.  According to a PwC report, India's video streaming industry is expected to grow at a compound annual growth rate of 21.82% to reach Rs. 11,977 crores by 2023¹, which is likely to be met much earlier, given the lockdown situation and lack of clarity on re-starting theaters. Accordingly, the traditional mechanism of movies first being released in theaters followed by over the top ("OTT") platforms and thereafter on satellite appears to have been distorted.

The growth of OTT platforms puts the spotlight on the question of regulating the content available on the online space. The existing laws and regulations viz. the Cinematograph Act, 1952 and the Cable Television Networks (Regulation) Act, 1995, read with the Cable Television Network Rules, 1994, regulate the content. Additionally, the Central Board of Film Certification ("CBFC") certifies movies prior to exhibition in theaters and exploitation on satellite. However, there is no specific or special statutory regulatory framework in place to regulate the exhibition of content on OTT platforms. Having said that, all content in India is subject to the laws of defamation, copyright infringement, the Indian Penal Code, and, when made available on the internet, the same is also subject to the Information Technology Act, 2000 ("IT Act").

In and around 2013, the Telecom Regulatory Authority of India ("TRAI") realized there was a void in legislation regulating content streamed via OTT platforms and accordingly issued a consultation paper titled 'Regulatory Framework for Over-the-top (OTT) Services' in 2015 and in 2018 inviting comments from different stakeholders. Parallelly, the Ministry of Information and Broadcasting ("MIB") in response to a Right to Information²  application in December 2016 stated that it did not have the power to censor any content available online and that MIB was not pursuing the creation of a regulatory framework for the OTT platforms. To a great extent,  this led to a lot of confusion regarding which Government body had the authority to regulate content on OTT platforms.

Stance of the Judiciary One of the first cases was filed by the Justice for Rights Foundation in the Delhi High Court in October 2018³, seeking formulation of guidelines for content created by OTT players like Netflix, Amazon Prime, etc. or in the alternative, to direct the government to frame guidelines for regulating such OTT platforms. The Delhi High Court issued notices to government bodies seeking clarity over the current position in law in this regard. The MIB stated that it did not regulate the OTT platforms and that the platforms did not require any kind of license from it. MEITY stated that it did not regulate online content and stated there is no regulation which deals with OTT platforms in particular, however, the IT Act provided deterrent actions to be taken in case any internet platform is misused for carrying any content or information which is not permissible under law. The Delhi High Court ordered that the IT Act provided enough procedural safeguards for taking action in the event any prohibited act is undertaken by the broadcasters or organizations on the internet/online platform and hence, dismissed the petition.

A similar petition was filed in the Delhi High Court, in the case of Nikhil Bhalla vs. Union of India⁴ wherein Nikhil Bhalla prayed for inter alia, a grievance redressal mechanism to be instituted to process complaints against content created for OTT platforms. This petition was filed alleging certain dialogues in the Netflix series 'Sacred Games' being derogatory and defamatory. Relying on the Justice for Rights Foundation judgment⁵, the Delhi High Court dismissed this petition stating that a different view could not be taken by the court.

An interesting question came up in the Karnataka High Court in the case of Padmanabh Shankar vs. Union of India⁶, wherein the petitioner – Padmanabh Shankar contended and prayed that: (i) since there was a lack of statutory framework for regulating content released by the OTT platforms, the court should set up a suitable authority to regulate the same; (ii) until a proper authority is set up to regulate the OTT platforms, the OTT platforms should be brought under the purview of the Cinematograph Act, 1952 and the Central Board of Film Certification ("CBFC") should certify all content uploaded on the OTT platforms; (iii) the OTT platforms could not avail the safe harbor protection under Section 79 of the IT Act, 2000⁷  as the OTT platforms have control over all the content uploaded and streamed on their websites; and (iv) watching the content via internet within the four walls of the house or office would amount to "public exhibition" under the Cinematograph Act, 1952.Interestingly, Section 4 of the Cinematograph Act, 1952⁸  states that a person requires an approval from the CBFC in order to exhibit the film publicly, however 'public exhibition' is neither a defined term nor has a settled position in law. Going by the interpretation of the courts in the case of Super Cassettes Ltd. vs. Board of Film Certification⁹, online content creators would require certification under the Cinematograph Act, 1952 as the courts have stated that even when a person is viewing content in the privacy of his/her own home, the content requires certification. However, the Karnataka High Court observed that the Cinematograph Act, 1952 applies only to cinematograph films within the meaning of Section 2(dd) of the Cinematograph Act and a video film or a video compact disc is included in Section 2 (c) of the Cinematograph Act¹⁰. The court observed that the internet is an interconnected network of all web-servers worldwide and webservers are a program that use the Hyper Text Transfer of Protocol ("http") to serve the files that form web pages to the users, which are provided in response to their requests which are forwarded by http to the client on their computers and that this did not fall under the definition of cinematograph under the Cinematograph Act, 1952. Thus, the court held that transmission or broadcasting of films, serials, etc. through the internet will not come under the purview of the Cinematograph Act, 1952 and the petition was dismissed.

After the Padmanabh Shankar judgment¹¹, the MIB invited suggestions on whether the content created by online platforms should fall under the Cinematograph Act, 1952, despite MIB's stance that it had no authority to regulate online content. Despite inviting suggestions, MIB did not take any step forward to propose any regulation. In any event, various courts have held that online content did not fall under the Cinematograph Act, 1952, and hence the MIB inviting suggestions on the same was redundant.

In light of these judgments, let us take a look at the laws which were already in place to regulate online content.

(a) Constitution of India – Article 19(1) provides for freedom of speech and Article 19(2) states that the freedom can be taken away by imposing reasonable restrictions which are in the interests of the sovereignty and integrity of India, the security of the State, friendly relations with foreign States, public order, decency or morality, or in relation to contempt of court, defamation or incitement to an offense. Such reasonable restrictions apply even to an OTT platform in the event the content shown on such OTT platforms is in contravention of such laws.

(b) Indian Penal Code, 1860 ("IPC") – IPC criminalizes (i) the sale or distribution of obscene literary works; (ii) deliberate and malicious intention of outraging the religious feelings;(iii) the acts of defamation and dissemination of any defamatory content; and (iv) penalizes anybody who insults or exhibits any object which insults the modesty of any woman or intrudes her privacy.

(c) Indecent Representation of Women (Prohibition) Act, 1986 – prohibits indecent representation of women in advertisements, books, movies, paintings, writings etc.

(d) Protection of Children from Sexual Acts, 2012 – penalizes child pornography.

(e) Information and Technology Act, 2000 ("IT") – penalizes publishing or transmitting obscene material, sexually explicit material and material depicting children in sexually explicit acts, in electronic form. Further, the Central Government has been empowered to issue directions to block public access of any information and punish any act which violates privacy of any person. The IT Act, 2000 also allows the government and the courts to direct the internet service providers, on whose network users access the OTT streaming websites, to either block or take-down movies available on such streaming websites that they consider objectionable. However, the biggest debate surrounding the IT Act is whether the OTT players can hide behind the safe harbor protection and avoid any kind of liability. The courts have earlier ruled that the OTT platforms are intermediaries¹² in relation to the content they host on their websites, applications, etc. In that situation, The Information Technology (Intermediary Guidelines) Rules, 2011 (the "Intermediary Guidelines") notified by MIETY provide a due diligence framework to be observed by intermediaries in respect of the information being hosted or published on any computer resource of the intermediary. The framework and provisions under the Intermediary Guidelines will also be applicable to OTT platforms which qualify as intermediaries under the IT Act. Despite the courts stating that OTT platforms are intermediaries, one bone of contention has been that the OTT platforms like Netflix, Hotstar, Voot, etc. have control over the content they stream on their websites because either they license the content from production houses or they create their own content for example – Netflix originals, Hotstar originals, etc. Thus, if the platforms are choosing and creating their own content, would they still be classified as an intermediary and hide behind the garb of Section 79 of the IT Act?

The Self-Regulation Codes With an aim to regulate the online content curators, the IAMAI released a regulatory code in January 2019 called 'Code of Best Practices for Online Curated Content Providers ("2019 Code")'¹³  which was signed by some of the OTT players such as Netflix, Hotstar, Voot, Zee5, Arre, SonyLIV, ALT Balaji and Eros Now.  The 2019 Code laid down the inter alia framework for a transparent disclosure system by (i) classifying the content into distinct and separate categories and that age-inappropriate content for minors would be accompanied by relevant disclaimers (ii) defines prohibited content and age sensitive content;(iii) provides for a complaints' redressal mechanism, whereby the OTT platforms shall appoint a dedicated person or team or department to receive and address any consumer related concerns and complaints.  

The IAMAI, in February 2020, introduced a new code titled 'Self-Regulation for Online Curated Content Providers ("2020 Code")'¹⁴  as a second tier to the 2019 Code. Reportedly, Hotstar, Voot, SonyLiv, Eros, and Reliance Jio signed to add a second tier to self-regulation for OTT space¹⁵. However, Netflix, ALT Balaji, MX Player and Zee5 have certain reservations with regards to the addition of a new tier to the 2019 Code vis-à-vis the 2020 Code. The 2020 Code set out a few changes in the manner of regulation of OTT platforms, including:

• Introduction of parental control and access control.

• OTT platforms to display a content descriptor or a guidance message specific to each content/program that indicates and informs the viewer about the nature of the content and advises on viewer discretion.

• Set up a new grievance redressal mechanism known as the Digital Content Complaints Council ("DCCC").

• Introduction of penalties: The 2020 Code gave the DCCC the power to impose penalties of up to Rs. 3 lakhs in case of violations.

• The signatories would also receive complaints forwarded by any authority / body / department / nodal agency of the Government of India.

• The OTT platforms would have to categorize the content available on their websites and classify the same based on the nature and type of content in the categories mentioned in the new code.

• The founding signatories to the 2019 Code would set up a separate body under the IAMAI, which shall be known as the Online Curated Content Providers Governing Council ("OCCP Governing Council").

The OCCP Governing Council would be governed by the "OCCP Council Charter". Each online content curator could nominate one representative to the OCCP Governing Council and decisions would be made by a simple majority.

The 2020 Code appears to be a comprehensive framework however, given the fact that some of the OTT platforms are not signatories to the 2020 Code, its effectiveness will have to be tested by the passing of time.

Conclusion

It is beyond doubt that with the advent of the 'OTT era', the interplay between media content and ownership, service provision and regulatory choices will undergo significant disruption. Some online players have started self-censoring their content for fear of litigation. Post the 2020 Code coming into place, Netflix released a set of new rules implementing the 2020 Code and providing password protection to profiles and filters for age-inappropriate content for kids. The implementation of the self-regulation codes might prove to be an upcoming challenge as all players have not agreed to sign the code. There needs to be a complete industry bind for the success of the self-regulation mechanism. Having spoken of regulating online content it is feared that too much censorship/ regulation could affect the creative liberty of the content writers/ producers and that in turn will affect the viewership of  OTT platforms. The regulatory framework for OTT platforms has been a work-in-progress since half a decade, and it looks like we still have a few gaps to fill in.