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Practical tips for job interviews at MNCs

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This article is written by Tushar Mehrisi.

I have had the good fortune of having worked at Google, which is often considered among the leading technology companies of the world. Other than Google, I have been at Airbnb and Wipro.

What these companies all have in common is an exhaustive and interesting interview process, which involves several rounds of interviews and at times even a written test. It is therefore no surprise that I often get asked questions on how did I crack these interviews, how many rounds of interviews did I actually have, what was that one thing which set me apart in these interviews and what advice would I give to younger professionals, who aspire to get hired at these companies.

I, therefore, decided to put pen to paper and share some of my insights, which I hope will be helpful to all of you and make this a fun and interesting read.

  • Understand the company you are interviewing for- Get to know them better. Other than knowing about your immediate role, learn about their vision/mission as well as their values and culture. This always goes a long way in any job interview.
  • Ask yourself the question – ‘why this company’?- Other than the role, what else drove you to wanting to work for this company. [Remember, the company would more often than not use this as the basis to distinguish you from the other applicants]. It simply can’t be the case that you applied to ‘x’ company for ‘y’ role as part of an ongoing search. There has to more through to it than that and that must come across.
  • Contextualise, Contextualise and Contextualise- Think of legal issues in the context of the company. It is good to know about the Data Protection Bill or the E-Commerce Rules but how do these draft/final legislations impact the company you are interviewing for. Think of examples you can quote!

  • Prepare, Prepare and Prepare- Read up more and more about the company. About the past, present and future of the company. About they why, when and what? No company would not want to hire an individual who understands its business, people and culture from the word go.
  • Wear your Confidence- Almost everyone has been to a good law school, read the same things and understands the law in a similar fashion but what makes you stand out is your confidence. It should always be the case that the company is both intrigued and impressed by you and being confident helps you achieve that.
  • Smile and Breathe. Can’t emphasize on this enough. You must enjoy giving your interview. If you do then the interviewer is also positively impacted. A little nervousness is natural and good to have but it must not overshadow your interview. If you remember to smile and breathe through your interview, you will bring out your best.
  • The ‘Why Me’ Test- You must always be prepared to answer what sets you apart and why the company should hire your over everyone else. Everyone gives a voice over of their career so far but what would set your voice over apart from the others. I once famously said at a job interview when asked this very question – ‘Why not me! I can’t think of a reason, can you?’ It did make me stand out and I did get that job J

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How can companies that have been struck-off, be revived

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This article is written by Sunkara Vishnu Ameya, pursuing a Certificate Course in National Company Law Tribunal (NCLT) Litigation from LawSikho.

Introduction

“Striking Off” of a company is one of the means of shutting down the company among other means like winding-up and liquidation. In simple words, striking off of a company is shutting down a defunct company. Section 248-252 of The Companies Act, 2013 read with Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 deal with striking off of companies and the procedure for it. The present article would deal with the process of striking off of companies and the means of reviving them and also touch upon the latest developments in this regard.

Ways of striking off companies

A company may be struck off by any of the following modes:

  • An application by the company for removal of name/strike off of company under Section 248(2) of The Companies Act.

Strike off by the ROC

The concerned ROC may strike off any existing company if the company has:

  1. Within one year from its incorporation has failed to commence business; or
  2. The company has not been carrying any business operation for the immediately preceding two financial years and has not made any application to the ROC in such period for obtaining the status of ‘Dormant Company’.
  3. The subscribers to the Memorandum of Association (MOA) have not paid the subscription at the time of incorporation and declaration to that effect has not been made within 180 days from the date of incorporation.
  4. After the physical verification of the company, it appears that the company is not carrying out any business activity.

Procedure to be followed for striking off the name of the company by the ROC

  • Service of notice by the ROC: The ROC is to send Notice in FORM STK 1 to the company and to the addresses of all the directors of the company.
  • Reply to the notice by the company: Within 30 days of receipt of such a Notice, the Company and all of its directors are required to send their reasons pertaining to why the company should not be struck off from the ROC.
  • Consideration of the representation made by the company: If the ROC is not satisfied with the representation made by the directors of the company, the ROC may proceed with striking off of the company.
  • Publication of notice of strike-off: The notice for removal of the company must be in FORM STK 5 and the same must be [laced in the official website of the Ministry of Corporate Affairs (MCA), in the Official Gazette as well as in a newspaper (English and Vernacular) widely circulated in the place where the company is situated.
  • Intimation to the regulatory authorities: The ROC must inform the same to regulatory authorities like the CBDT, CBEC, and other concerned regulatory authorities.
  • Strike off of the name of the company: The ROC after 30 days of intimation to the regulatory authorities and after receiving NOC from the regulatory authorities strikes off the name of the company.
  • Provision to realise the amount due: Before proceeding with striking off the name of the company from the register, the ROC ensures that there is no default subsisting, and in case there is a default, the default is made good.
  • Strike off by the company: Under Section 248(2) of The Companies Act, 2013 r/w Rule 4 of The Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016, a company registered with the ROC files an application for removal of name from the register of companies.

Types of companies that are barred from filing an application for striking off

  1. Listed companies,
  2. Companies registered under Section 8,
  3. Companies that have charges pending satisfaction,
  4. Companies that have a prosecution pending before any court of law,
  5. Companies that have been delisted for non-compliance,
  6. Companies that have accepted public deposits and have defaulted,
  7. Companies where investigation or inspection has been ordered but is pending.

Procedure to be followed by the company for filing an application for striking off to the ROC

  • Call a board meeting: A board meeting must be called and held and a resolution to that effect for removing the name of the company from the register of companies must be passed. 
  • Existing debt or liability: Post a board resolution, the company is bound to set off/pay the existing liabilities.
  • General meeting: A general meeting must be held and passed with a special resolution.
  • Statement of accounts: Statement of accounts must be procured by the company in Form STK-8 30 days prior to filing an application.
  • No objection certificate: A no-objection certificate from the appropriate concerned authority must be filed along with the application.

Recent developments

As companies under the Companies Act, 2013; companies are bound to follow statutory compliances like filing annual returns, financial statements, and filing of other statutory returns. As mentioned above, any company which defaults in complying with the aforementioned factors would be liable to be struck off by the ROC. 

To provide respite to such companies and LLPs, The Ministry of Corporate Affairs (MCA) vide circular no. 12/2020 dated 30th March 2020 launched a scheme titled ‘Companies Fresh Start Scheme, 2020’ to provide defaulting companies with an option to make a fresh start. This move ensured that inactive companies remained on the list of ROC without getting struck off. Initially, the said scheme was applicable till September 2020; but the same was extended to December, 31st, 2020 and further extension is being considered by the MCA. The application is to be filed in CFSS,2020 and the said Form must contain attachments pertaining to proof of withdrawals of appeals (if any), pending investigations, or prosecutions if any against the company.

Further, a proviso was inserted into Rule 4 of The Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 by the Companies (Removal of Names of Companies from the Register of Companies) Amendment Rules, 2020 on 29th June 2020. The said amendment applies to a Government company in which the entire paid-up share capital is held by either the Central Government or State Government and a subsidiary of such a company. The authorized representative of such a company who is not below the rank of secretary or its equivalent, in the administrative Ministry or Department of the Government of India or the State Government, as the case may be, on behalf of the company; must file an ‘Indemnity Bond’ in FORM STK-3A to the ROC. The said bond must contain the following aspects:

  • To indemnify the claimants for all lawful claims against the company arising in the future after the striking of the name of the company;
  • Any person for any losses that may arise pursuant to striking off the name of the company;
  • The claimants for all lawful claims and liabilities, which have not come to notice up to this stage, and if any claim arises or is observed even after the name of the company has been struck off in terms of Section 248 of the Companies Act, 2013.

Reviving a struck-off company

A company that is struck off from the ROC may be revived by filing an application to the National Company Law Tribunal (NCLT) in FORM STK 7 wherein the order of striking off may be challenged.

Who may file an application for reviving a struck off company

If the ROC Suo Moto after issuing notice to the company under Section 248(1) of the Companies Act strikes off the name of the company, even if the company is an active company due to non-filing of reply, the directors of the company may approach the National Company Law Tribunal (NCLT) by bringing an appeal for restoration of the name of the company.

An appeal may also be filed to the NCLT within 3 years of the order of the ROC and if it appears to the NCLT that striking-off the name of the company is not justified, the NCLT may pass an order for restoration of the name of the company.

The ROC too may file an application to the NCLT within three years from the date of passing of the order of striking off the company under Section 248 if the ROC is satisfied that the company had been struck off due to wrong details furnished by the board of directors.

Any member, creditor, or workman aggrieved by the company having its name struck off from the register may file an application to the NCLT before the expiry of a period of 20 years from the publication in Official Gazette the notice of dissolution of the company if the applicant can prove:

  1. The company was, at the time of its name being struck off, carrying on business or in operation; or
  2. Otherwise, it is just that the name of the company is struck from the ROC.

Further, the NCLT is even empowered to order that the name of the company be restored to the ROC and can even pass an order and give such directions and make such provisions for placing the company and other persons in the same manner as if the company had not to be struck off from the ROC.

Grounds for revival in general

The NCLT usually looks into the following grounds while considering an application for the revival of a struck-off company. They are as follows:

  • Whether the company holds any immovable property.
  • Whether the company had complied with GST, income tax, and other authorities apart from the ROC.
  • Whether there are any ongoing transactions that evidence the company is still active.
  • Whether the company has renewed any license on an ongoing basis.
  • Any other documents evidencing the company is active.

The procedure for the revival of the company

The application to the NCLT shall be made in Format NCLT 9 accompanied by a demand draft of Rs. 1,000 payable to the Ministry of Corporate Affairs (MCA). The following documents are to be accompanied by the said application:

  • An affidavit verifying FORM NCLT-9.
  • striking off order passed by the ROC.
  • Certificate of incorporation.
  • Memorandum of association.
  • Copy of the latest audited financial statements since the financial year in which the said audited financial statements have not been filed with the ROC.
  • Bank statements.
  • Copy of the board resolution authorizing the filing of the application.

A copy of the petition is to be sent to the ROC within 14 days before the date of hearing in the NCLT. If the NCLT orders for the revival of the name of the company in the ROC, the company shall:

  • File a certified copy of the order in eFORM INC 28 within 30 days, and
  • File pending annual financial statements and annual reports to the ROC.

Case laws pertaining to the restoration of struck off companies

In the case of Rajiv Kapur v. ROC & Ors., the NCLAT ruled that a creditor of a company could file an action for restoration of struck-off companies as a “Creditor” falls under the ambit of “Concerned Parties.”

In the case of Kaynet Finance Ltd. v. Verona Capital Ltd., the appellants were appointed as stock brokers of the company that applied to be struck-off. The appellants generated false debits and issued fabricated contract notes to the company and thereby fraudulently siphoned off Rs. 112 crores. The NCLAT ruled that the said appellants would fall under the ambit of “Debtors” and not “Creditors” and do not fall under the category of “Concerned Persons” or “Aggrieved Persons.”

In the case of Alliance Commodities (P) Ltd. v. Office of ROC, the company was struck off by the ROC for non-filing of balance sheets and other statutory reports. The company contended that no notice was received by it. However, it was found that when the ROC sent the notice through a speed post, the company was carrying on active business and the notice was put forth by the ROC on its website. The NCLAT ruled that in presence of both these elements, the striking off by the ROC is valid under Section 248.

Conclusion

The provision of striking off companies acts as a means to ensure shell companies do not operate and companies do not get shut down with the intention to defraud creditors. The entire edifice of this provision rests on the fact that the company is not active, i.eThe company does not undergo transactions evidencing business or holds any immovable property. The possibility of revival of a struck-off company ultimately depends on the evidence put forth by the applicant, which evidences the aforementioned criteria. 

References


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Can divorce be granted by arbitration

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This article is written by Vivek Maurya from ICFAI Law University, Dehradun. This article describes the arbitration process for divorce and how it is different mediation.

Introduction

When a couple decides to end their marriage, conflicts arise that must be resolved as part of the divorce decree. Property distribution, child benefits, and child support are some of the issues that require attention so that each party can continue living their own lives. Resolving these issues and getting a divorce can happen without the lengthy and costly process of litigation. More couples than ever are now choosing alternatives to litigation to end their marriage.

If litigation requires multiple court dates and a formal process is required for the judge to decide on a dispute, alternative methods such as arbitration may provide a more customized way to annul the marriage. Both of these methods are simpler, faster, and less costly than litigation. Before deciding between litigation or arbitration, it is important to consult an expert legal advisor.

Arbitration

Meaning of arbitration

Arbitration is a form of alternative dispute resolution (ADR), which means it is a way for opposing parties to find a solution to a problem without litigation. The parties present their sides with any evidence that may be relevant and then the arbitrator, a neutral, independent third party, reviews the facts and according to Section 31 of the Arbitration and Conciliation Act, 1996, decides on a solution called an award. Arbitral awards are binding, meaning that the decision is final and can be enforced.

Arbitration law in India has always been in practice since its inception in 1940. The Arbitration Act is a constitution of several announcements and ordinances passed by the Government of India from time to time to carry out the economic reforms taking place in the country. The Arbitration law in India is primarily enshrined in the 1996 Act, which was passed to strengthen the laws relating to domestic and international arbitration and its enforcement. Some major amendments were introduced in the years 2015 and 2019 to make arbitration a preferred method of settlement of commercial disputes and to make India the centre of international commercial arbitration. The present law is a combination of many such amendments with the latest 2019 amendment.

Benefit of Arbitration

The popularity of arbitration was acknowledged by the whole world. However, the reason for the rise in popularity was driven by the advantages of arbitration over other forms of adjudication or dispute resolution.

Saves a lot of time

The process of arbitration not only saves the time of the parties but also the courts’ time. Most civil cases take a long time for the courts to resolve the dispute. Often a generation elapses before the process is complete. Alternative dispute resolution procedures were introduced to reduce the time taken for the adjudication process. In addition, business disputes need to be resolved as quickly as possible.

Hence, families prefer to opt for arbitration to settle disputes as compared to other forms of dispute resolution. Arbitration is also a simple process in which the venue and timing of proceedings are chosen by the parties themselves.

Cost-effective

The time saved in the arbitration process also saves money involved in the process. Compared to litigation, the cost involved in arbitration is low. The quality of being cost-effective is one reason why parties prefer to use arbitration as a means of resolving their disputes.

Confidentiality

Another factor contributing to the success of the arbitration process is the importance given to the confidential information involved in the process. During the duration of the process, proper care is taken to ensure that the privacy of the parties is not compromised. The recent amendment to the Arbitration and Conciliation Act in 2019 makes the parties in arbitration duty-bound maintain the utmost secrecy of the process. Confidentiality in arbitration procedures is appropriate for parties, who want to keep their disagreement out of the public light.

Fairness

There is an element of integrity that dominates the arbitration process from the very beginning. The selection of arbitrators is a matter of the parties, the parties are heard personally in the arbitration proceedings. More importantly, the process of arbitration is established on the fact that the parties settle their disputes amicably.

Command

The parties to a dispute have more control over the arbitration process than any other dispute resolution process since the parties are in a position of control from the very beginning. The parties are directly involved in the decision-making process to enforce their agreement in the proceeding.

Procedure for filing a divorce through arbitration

Arbitration allows parties to the divorce to determine how formal or informal a process is to be used, and it also has the benefit of confidentiality. Unlike mediation, however, arbitration retains many of the characteristics of litigation. Both parties select a single arbitrator and work with their counsel to prepare for the hearing as in litigation, each party presents documents, witnesses, and other factors.

The unbiased arbitrator then decides divorce disputes, applying the actual law to the specific facts presented. One concern may be that the arbitrator’s decisions are final, and generally not reviewable by the court. Nevertheless, parties can engage in a private appellate arbitration process to acquire an additional review, like the state’s appellate division. Arbitral divorce proceedings can be completed quickly, often in just a week, with a decision usually issued within forty-five days and retain many of the benefits of litigation with each spouse having a separate governing council.

It can take one to two years for a divorce to make its way through the court system. Similarly, the parties do not have a say in which a judge is assigned to the case. What’s most troubling is that the litigation process can be lengthy, costly, and the results can be unfavourable or unpredictable. Trials are stressful and exhausting. Often a judge’s schedule leaves little time for a week to preside over a trial.

Benefits of divorce through arbitration

More and more couples who see the payment and strain involved in courtroom divorce are choosing arbitration because of the following benefits.

Arbitration is faster than a courtroom divorce

The family section of judges is overwhelmed with applications. It can take several years to get a final decision in a disputed divorce proceeding. If you are looking forward to moving on with your life after filing for divorce, you can do so by choosing arbitration. Once you and your spouse have settled on an available arbitrator, hearings can be quickly scheduled and you can decide within months.

Arbitration provides confidentiality in family matters

A judge’s decision is a matter of public record. Judges often use fictitious names for children involved in divorce or custody cases but if special circumstances do not apply, then these public judgments include the full names of both spouses. On the other hand, the decisions of the arbitrators are completely confidential.

Parties can decide the procedure

One reason that courtroom divorce lawsuits take longer than arbitration is that the trials involve many formalities. In arbitration, the parties are allowed to forego most of the tedious rules. The parties can decide what level of details should be included in the arbitrator’s decision and may do away with the rules governing what evidence is or is not admissible.

Role of arbitration in a matrimonial matter

India deals with arbitration of divorce to protect the rights of the divorcing parties which may not be possible in the case of civil courts. This is the reason why arbitration is given more preference. There are 2 main provisions of the Civil Procedure Code regarding divorce arbitration in India –

Section 89 – settlement of disputes outside the courts

The provisions under Section 89 of the Code of Civil Procedure are an attempt to resolve disputes between the parties, to reduce the cost and burden of the courts. It is designed for the sole purpose of combining legal and non-legal dispute resolution mechanisms and bringing alternative dispute mechanisms as a part of the Indian judicial system. The lengthy process of litigation, the expenses incurred by both parties, and the limited number of judges have made alternative dispute resolution an important element to ensure a fast and effective criminal justice system.

Section 89 of the Code of Civil Procedure was introduced to bring about an amicable, peaceful, and mutual settlement between the parties without the intervention of the court. In countries around the world, especially in some developed countries, the majority of cases (over 90 percent) are settled out of court. The matter/dispute between the parties will be heard by the court if there is a failure to reach a solution.

Order XXXIIA  – suits relating to matters concerning the family

Order 32A was included in the 54th Report on the Recommendations of the Law Commission in the Code of Civil Procedure. The order seeks to highlight the need to take a different approach to matters relating to problematic families, including the need for efforts to bring about a friendly solution.

The provision of this order shall apply to cases or proceedings relating to family matters – 

  1. For marital relief, including a declaration as to the validity of a marriage or the marital status of a person.
  2. To declare the legitimacy of a person.
  3. Concerning the custody of a person with a disability or in the custody of a minor or another family member.
  4. For maintenance.
  5. About the legality or impact of adoption.
  6. Suits established by a member of the family are related to the will and the succession.
  7. Relating to any other matter relating to the family in respect of which the parties are subject to their law.

Mediation for divorce

In mediation, parties to the divorce select a mediator who oversees the direct negotiations. The parties may appear with or without consultation. The mediator will not give legal advice or order the outcome but will guide the parties to conclude.

This approach works best when the parties can communicate openly or are willing to reconcile and even help establish the foundation for a future relationship. Since it is a direct conversation, the process is completely confidential, which greatly benefits the parties discussing private financial or sensitive matters. Once an agreement is reached, a written declaration of compliance is prepared by the mediator, who often recommends that the parties consult an independent attorney who can assist in finalizing a formal written agreement.

If both parties can communicate openly, this approach allows for highly customized solutions, as the negotiation is not bound by statute or case law as it would be in litigation. “The most important thing is to choose the right mediator, that is someone professional, patient, a good interlocutor, and experienced in matrimonial matters”, said Mary E. LihotzArcher’s former member of the New Jersey Judiciary. “Parties should develop trust with the mediator so that they can openly discuss the needs and concerns in settling their case”, Lihotz said.

Understanding the difference between arbitration and mediation for divorce

In mediation, you communicate with the other spouse with the assistance of a mediator. In arbitration, you present your case to the arbitrator in the hopes that they will decide in your favour.  The difference between the two is that one is a facilitated negotiation and the other is a court-like proceeding. The mediator may try to come up with new ways to help the parties resolve their disagreement. That space would not be available to an arbitrator.

Mediation is a less formal process than arbitration. It’s comparable to going to court, only you get to choose your judge. An arbitration procedure may resemble a divorce trial in appearance and feel. However, it is a method of resolving the issue without the full expense and animosity of a court-ordered divorce trial. The procedure remains judicial.

Conclusion

Worldwide, alternative dispute resolution is slowly and gradually becoming the preferred and best method for settling disputes outside the court of law. Determining the right approach for getting divorced and can be challenging to reach a result. This decision ranges from the position of the parties to financial matters and timing.

Engaging the right attorney early in the process is essential not only to represent each spouse’s interests in the proceedings, but to advise between arbitration, or litigation and to ensure the most painless dissolution of the marriage. Multiple levels of appeal also eliminate both sides and make it a burden on the system of courts. The Indian legislature is trying to bridge the gap to promote the arbitration route to be in line with the evolving global jurisprudence.

References


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Legalities of e-signing of contracts and documents in the COVID-19 era : a study

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This article is written by Atchaya J, pursuing Diploma in Advanced Contract Drafting, Negotiation, and Dispute Resolution from LawSikho.

Introduction

Electronic signatures, e-signatures or e-sign may not be an element of novice nature. They indeed have been existing for a long period of time but have gained great traction with the COVID-19 pandemic altering our way of life as well as the way of conducting business. Did you know that e-signature is a better alternative to digital signature? Let us explore how and identify the provisions enforcing the validity of these e-signatures.

What are e-signatures?

An electronic signature (e-sign) is an online digital signature that acts as an equivalent to a physical signature binding the respective parties to a contract. Section 2(1)(ta) of the Information Technology (Amendment) Act, 2008 defines “electronic signature” as “authentication of any electronic record by a subscriber by means of electronic techniques (specified in Schedule II of the Information Technology Act, 2000), including digital signatures”.

Difference between e-signature and digital signature

As similar as they might sound, in reality, e-signature and digital signature are two different types of signatures. Both are legally valid, recognises assent and binds the parties to a contract.

E-signature is applied by authenticating the identity of the user/party through Aadhaar ID (the unique identification number issued by the Indian Government) using an eKYC(Electronic Know Your Customer) service such as OTP(One Time Password). This eKYC service is provided by an e-sign service provider. A user can securely sign the documents with e-signature, using a mobile or web app interface which is provided to them through e-signature service and Application Service Provider integration.

Whereas, a digital signature is a digital certificate authorised by a reputed Certifying Authority (CA). A trusted list of CA root certificates is maintained by Operating Systems and Browsers to verify digital certificates issued by a CA. The user is also entitled to receive a USB token containing the digital certificate-based ID and personal pin to securely sign documents. Unlike e-signature, digital signatures require a physical cryptographic token that has been used for filing tax returns and filings with various government agencies.

E-signatures came into the picture to avoid the hassle of hardware cryptographic tokens, which were mandatory for the “digital signature”. This USB/dongle based facility proved to be financially unfeasible, thus paving way for e-signatures.

What is the validity of e-signature?

E-signature is the consent of the party which is an essential ingredient for a valid contract. Thus, an e-signature should align with all the requirements of valid consent according to Section 14 of the Indian Contract Act 1872. Apart from these requirements, an e-signature must align with conditions laid down under Section 3A(2) of the IT Act, which is as follows:

  1. Link: During the time of signing, the e-signature authenticated should be linked to the signatory or the authenticator but no other person.
  2. Control: During the time of signing, the e-signature authenticated should be under the control of the signatory or the authenticator but no other person.
  3. Alteration done to the signature: Any alteration or modification made to the e-signature after affixing should be detectable.
  4. Alteration done to information: Any alteration or modification made to the information after the execution of the e-signature should be detectable.
  5. Condition: The e-signature should fulfil any other condition which may be prescribed.

Up until recently, there was no legal provision for authentication techniques until the Electronic Signature or Electronic Authentication Technique and Procedure Rule, 2015 came into effect. The authentication of electronic records through the Aadhaar eKYC service as discussed above is recognised as a valid authentication technique through this provision. Currently, there are four agencies qualified and empanelled with Controller of Certifying Authorities or CCA (gateway for eSign) to operate as eSign Service Providers). They are as follows:

  1. E-Mudhra Ltd,
  2. CDAC,
  3. Code Solutions,
  4. NSDL e-government digital signatures.

E-signature in the COVID-19 era

Technological adoption in India started way before the pandemic through the government’s Digital India initiative which prioritizes the development of digital infrastructure and aims at transforming India into a paperless economy. This slow shift has been actually accelerated with disruption created due to COVID-19. All the business models are being pushed to embrace the change and switch to methods that can be executed online to reduce the spread of the virus and abiding by governmental rules. Hence, even contractual transactions have been digitizing at a rapid pace. Understanding and familiarizing with the concept of e-contracts, online negotiation, exchange and finalization of terms via emails, assenting through e-signatures have become the need of the hour for successful business transactions. E-signatures can be applied to internet transactions, assenting to a contract via email as well as paper documents.

Advantages of e-signing

According to a report published by KPMG and Google, India witnessed twice the growth in profits for digital SMBs as compared to offline companies. E-signature has been that pivot for that shift towards digitization. It is not only an alternative solution during lockdown restriction but also a better solution for the contractual parties given its benefits.

Firstly, e-signature speeds up the whole contractual process. Gone are the days when contracts had to be signed, shipped, faxed or scanned etc. It involved huge time consumption, delay in execution and huge costs as well. All these no longer pose a problem with e-signature. Even if the parties are geographically diverse, negotiating, flagging critical issues, correcting, tracking and signing electronically removes the time barrier in the whole process. In time-sensitive industries such as Healthcare, this factor is crucial and can be a matter of life and death.

Secondly, e-signature is preceded with trackability conditions as specified under Section 3A(2) of the IT Act. It means all the changes are detectable, thereby reducing the risk of tampering with the signature or information unlike with physical paper contracts or signatures.

Thirdly, the most obvious advantage is Cost Reduction. Not only the cost related to shipment as discussed earlier is reduced but also cost relating to human error, signing mistakes and others are drastically reduced with e-signature. AI advanced or specifically programmed software can detect suspicious records of signatures.

Other than these e-signatures provide a better defensible stand point than wet ink signatures in the court of law.

Challenges with e-signature

There are certain documents which by law require the completion of certain procedures and cannot be executed through e-signatures. Such documents require a notarial process or registration with Registrar or Sub-Registrar, which mandatorily requires handwritten signatures. As per Schedule I of the IT Act following cannot be executed through e-signatures:

  1. Negotiable instruments,
  2. Trust deed,
  3. Power of Attorney,
  4. Will and other testamentary disposition,
  5. Lease, sale agreement and other real estate contracts dealing with immovable property.

Status of legal validity provided to e-signature through IT Act pose a challenge to the non-Indians who cannot make use of the digital signature or Aadhaar enabled e-sign. Moreover, e-signature becomes an issue in conveying acceptance. For instance, ambiguous terms may not be completely clear for any of the parties but concrete e-signature will make it difficult to prove such complexity in the court of law.

The whole process of securing documents with e-signature might be far from normal understanding of a common man. From encryption to verification process involves exchange of personal data and might pave the way for breach of personal information through systematic fraud. The third-party platforms which don’t follow encryption might also result in compromising sensitive information. Once the documents are up in the server, there are endless possibilities of hacks and fraud. Thus, only trusted, verified and government or regulatory body approved platforms should be utilised for highly-sensitive documents.

Last but not the least, technological access throughout the country’s population is extremely biased and unequal. For poor people, uneducated, rural and unaware population, securing documents through e-signature not only seem unfathomable but also impractical.

Is it the end of “wet ink” signature?

As discussed earlier, under the ambit of the IT Act certain documents must be assented to with hand signature. Even UETA (Uniform Electronic Transactions Act) in the US contains exceptions such as probate, domestic law documents, real estate foreclosures etc which cannot be executed through e-signatures. With continuous limitations imposed in the form of governmental lockdown and movement confinement, pandemic way of life is becoming the new normal. This situation pushes the execution of deals through methods that minimize risk and human contact and simultaneously cut costs. Thereby, even post-pandemic, the use of e-signatures will rapidly continue given the advantages. Despite the current climate, wet ink signatures will remain and survive given the exceptions and disparity of technology access among the population.

Conclusion

With the growing volume of online transactions and contractual transactions, implementation of e-signature can shape the way for more efficient e-commerce functions. Various countries are coming up with their own separate legislation for e-signatures every year. Even virtual notarizing is being executed in some technologically advanced countries. With proper legislation in place, India can aim towards a paperless regime with digitizing processes such as notarization and e-stamping. According to the Stamp Act, any instrument creating any right or liability, when executed in India is required to be stamped as per changing times, nature of the instrument and state laws. To have a system in place for e-stamping such instruments creating a fully compliant e-document in the future, we can look forward to.


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Importance of knowing the effective date of a contract

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Interpretation clauses
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This article is written by Aditya Sunil Naik, pursuing Diploma in Advanced Contract Drafting, Negotiation, and Dispute Resolution from LawSikho.

Introduction

Parties enter into contracts to record their rights and obligations in writing, to ensure clarity and avoid uncertainty. An essential component of a contract is an ‘effective date’. The effective date of a contract states the date from which the terms of the contract shall come into force. It is not to be confused with ‘execution date’, which is the date on which the contract is executed by the parties. Since an effective date governs when the rights and obligations of the parties come into effect, it is important to ensure that such a clause is properly drafted to reflect the intentions of the parties.

Effective date defined

There is no statutory definition of an effective date and when it should be or when it can be used. Like most terms in contracts, they can be drafted according to the negotiations between the parties in the manner they seem fit. Of course, any such clause drafted must be within the ambit of the Indian Contract Act, 1872.

While it is true that the rights and obligations of the parties only come into effect on the effective date, it is not mandatory for every contract to have an effective date. In such a case, the execution date would be treated as the effective date and the rights and obligations under the contract would commence from then.

Further, an effective date usually brings into operation clauses substantially relating to the rights and liabilities concerning the performance of the contract. Clauses relating to general matters such as governing law, dispute resolution, confidentiality, and severability are usually made to operate from the execution date since they deal with the operation of the contract itself and not so much with the rights of the parties.

The effective date can be prospective or retrospective as well. In the case of the former, the rights and obligations of the parties are effective from a later date, sometimes contingent on the performance of certain promises. This is the generally prevailing practise in most contracts. On the other hand, the latter makes the rights and obligations effective from a past date. This can be the case in contracts where the parties have recorded the terms in writing at a date after their oral agreement.

Purpose of the effective date

A natural question that may come to your mind is the need for an effective date when the execution date is given in an agreement. The answer is simple; it is done so that the parties can execute an agreement and get to the performance of their obligations at a subsequent stage, upon the completion of certain conditions. This ensures that the parties lock their interest in going further in the agreement without attaching all the obligations immediately.

Such conditions that are imposed that make the commencement of the agreement contingent on it are known as ‘Conditions Precedent’. Conditions precedent are obligations imposed on the parties that have to be fulfilled for the agreement to become effective. It may or may not be time-bound but it is advisable to include a time limit within which the clause has to be complied with, failing which the agreement would stand terminated.

Common situations when agreements are executed first but are effective later are found in commercial transactions such as mergers and acquisitions, business agreements, real estate transactions and contracts of insurance. In these cases, the parties commence due diligence and other preliminary processes to verify the subject matter of the agreement. Once they are complete with the due diligence, they have a complete idea about the contract being entered into. They are then in a better position to negotiate the terms of the transaction more effectively.

Therefore, by executing an agreement with a later commencement, the parties ensure that neither backs out at a subsequent stage. This helps establish trust that the parties are willing to follow through with the transaction, provided that the conditions precedent are complied with and there are no material facts that have not been disclosed.

Case laws on effective date

Now that the concept of an effective date is clear, it is useful to refer to a few judicial pronouncements on the issue, to get an understanding of how the courts interpret such a contractual provision.

1.    Oriental Insurance Co. v. Sunita Rathi

In this case, the owner of a vehicle had purchased insurance for the vehicle from the insurance company. The cover note issued with the insurance policy stated that the policy would be effective from 10.12.1991 at 2:55 PM. The vehicle had met with an accident on the same day at 2:20 PM. The Supreme Court held that where the effective date and time were clear from the facts of the case, there was no scope for any interference. The Court held that the liability of the insurer would commence from the date and time given in the cover note and not at any point earlier.

This case perhaps amply signifies the importance of an effective date in a contract. Even a difference of 35 minutes made a difference in the liability of a party under a contract. In another case having similar facts, the Supreme Court arrived at the same decision (New India Assurance Co. v. Bhagwati Devi and Others). Therefore, it is highly advisable to appropriately draft an effective date clause in a contract where it is necessary and to do so in a manner protecting the interests of the parties concerned.

2.  Bangalore Electricity Supply Company Limited (Bescom) v. E.S. Solar Power Private Limited and Others

This case is an excellent illustration of the need of having an accurate definition of an effective date and any associated definitions, such as a month, year etc. The present case is between the appellant, an electricity supply company of the government, and the respondents, special purpose vehicles created for setting up a solar power plant in different parts of Karnataka. The parties entered into a Power Purchase Agreement (PPA) after the respondents were awarded projects.

The terms of the PPA were such that the respondents were bound to commission the plant within a period of 12 months from the effective date, which was the date the PPA was approved by the Karnataka Electricity Regulatory Commission (KERC). Failure to do so would entitle the appellant to reduce the tariff that would be paid to the respondents. The appellant would also be entitled to claim liquidated damages for the delay in commissioning the plant.

The KERC approved the PPA on 17.12.2016. The plant started generating power on 16.12.2017 but was synchronized with the grid and started injecting power into the grid only on 17.12.2017. The appellant claimed that there was a delay of one day on the part of the Respondent to commission the plant and claimed a reduction in the tariffs payable and sought liquidated damages for the delay.

The PPA defined the Scheduled Commissioning Date as the date that falls 12 months from the effective date. A month was defined as a calendar month under the Gregorian Calendar. The PPA provided that references to any date or period shall mean and include such date, period as may be extended under the agreement. It further provided that any reference to any period commencing from a specified date and until the specified day shall include both such days or dates.

It was not disputed that the date of the event, i.e., the approval of the PPA by the KERC was 17.12.2016. Therefore, the Scheduled Commissioning Date was 12 calendar months from the said date, i.e., 16.12.2017. However, the Supreme Court held that since the agreement provided that the date of the event shall be excluded from the calculation, the Scheduled Commissioning Date would be 17.12.2017.

Therefore, it was held that the respondent was not in breach of the PPA and that the commissioning took place as per the schedule laid down. It is noteworthy to mention that there was a dispute about the commissioning of the plant, which was not examined by the court since it became infructuous upon the determination of the Scheduled Commissioning Date. The respondents relied on the minutes of the meeting of officials on 16.12.2016 to prove that the plant was commissioned on the said date.

Therefore, this case should serve as an example to readers to ensure that they define the effective dates clearly. Moreover, it is important to keep in mind ancillary definitions such as a month, year, day and calculation of time periods to ensure that there is no ambiguity or confusion. Further, it is important to define events clearly when a definition depends on the happening of an event. Additionally, it is crucial to ensure that all documentation about the implementation of the agreement is in order so that no waiver or acquiescence can be inferred.

3.   Madhya Pradesh Power Generation Company Limited & Anr. v. Ansaldo Energia Spa & Anr

As we had discussed earlier, parties put in certain conditions that are to be fulfilled before their obligations under the contract come into force. These are known as conditions precedent. Usually, in such contracts, the effective date is the date on which the conditions precedent are fulfilled or at a certain fixed period after such date.

In the present case, the respondent and the appellant entered into agreements for the refurbishments of the power plants of the appellant. The ‘zero date’, in other words, the effective date of the contract was defined to be the date on which the conditions given therein were fulfilled. They included the signature of the contract, furnishing of bank guarantees by the respondent in the favor of the appellant, among others. The contract provided that if the zero date did not occur within six months of the agreed date, the contract would then expire automatically without liability on either side and the prices would be subject to renegotiation.

The parties agreed upon a zero date, after which there was an exchange of correspondence between them. Several meetings were held between the parties for the resolution of issues that arose. About a year after the agreed zero date, the respondent then responded to a letter of the appellant, asking it to treat the contract as expired.

Among other issues, one argument raised by the respondent was the non-furnishing of a letter of comfort from the Power Finance Corporation, which was a fundamental condition in one of the contracts executed between the parties. This, however, was not present in the clause relating to the zero date. The matter went for arbitration before reaching the present court.

The Arbitral Tribunal rejected the argument of the appellant that there was a waiver on the part of the respondent in not obtaining the letter of comfort. It held that since the appellant did not insist on the production of the letter of comfort as a precondition to the zero date, there was nothing in the agreements that stopped it from claiming it at a later stage. The Court, however, rejected this view based on the evidence produced and held that the letter of comfort was a fundamental condition to the agreements and the failure on the part of the appellant was a breach.

Therefore, from this case, we can learn that an agreement is not only reliant on effective date and conditions precedent clauses, but also any other obligation that may be necessary to be discharged prior to its commencement. This emphasizes the importance of having a well-drafted, consistent and coherent agreement that accurately reflects the intentions of the parties.

Conclusion

From the above discussion and analysis, it is clear that using an effective date for an agreement is a useful way to get the parties to commit to proceeding with the transaction. It ensures that there is a certain degree of certainty that the parties shall follow through with the transaction, provided other conditions are fulfilled. The interpretation of an effective date is plain and simply derived from what is given in the contract. Provided that it is clear, there is virtually no scope for interference in such a clause. Even a difference of a few minutes, as seen above, can determine the contractual liability of a party. Therefore, parties must ensure that such clauses are drafted clearly to avoid any confusion or disputes in the future.


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Seafarers employment contracts and essential clauses to be included

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This article is written by Aarushi Pandey, pursuing Diploma in Advanced Contract Drafting, Negotiation, and Dispute Resolution from LawSikho.

Introduction

This article aims to aid in a general understanding of a standard and basic seafarers’ employment agreement that is not tailored to country-specific guidelines or law. Usually, different countries have their own set of rules and regulations consisting of particulars and specifics that deal with seafarers’ employment contracts. However, there are some standard practices common to all jurisdictions that have been addressed in this article along with relevant examples.  

What is a contract? 

Cornell Law Dictionary defines a contract as an agreement between private parties that creates legally enforceable mutual responsibilities. Mutual consent, a legitimate offer and acceptance; appropriate remuneration; capability and legality are fundamental components for this agreement to establish a legally enforceable contract.

What is an employment contract?

Black’s Law Dictionary defines an employment contract as a contract between an employer and an employee, It is usually voluntary, purposeful, and legally enforceable, making it legally binding. As a condition of employment, the employee must agree to this contract. Employment contracts contain a wide range of processes and/or rules that must be followed by the employer in order to safeguard their own interests. The contract sometimes includes a time limit that prevents the employee from working for a rival or in a comparable field after they leave the firm. This provision is frequently challenged in court.

General definition of seafarers

The term “seafarer” refers to “shipboard crew personnel including Ships’ Officers and seamen/ratings.” According to Black’s Law Dictionary, a “seaman” is a person who is connected to a navigation vessel as an employee below the rank of officer and contributes to the vessel’s operation or the achievement of its purpose under the Jones Act and the Longshore and Harbor workers’ Compensation Act of the United States of America, also known as a crew member, a mariner, or a member of a crew. A typical sailor is a member of a commercial vessel’s crew. Vessels, on the other hand, are not restricted to the movement of commodities through the water. The execution of another task by a vessel, functioning as a cruise ship, demands the presence on board of workers who do not ‘man, reef, and steer’ the vessel. Exploration for oil and gas in navigable seas has broadened the definition of a seaman.

According to the other legal dictionaries, a “seaman” is a person who has been certified qualified by national law or regulation to perform any job required of a deck department member of the crew. The phrases “seaman,” “mariner,” and “member of the crew” are used interchangeably with the term “seafarer.” A vessel’s crew consists of the Master, officers, and ratings. However, according to some accounts, the crew are members of the ship’s company with a rank lower than that of a ship’s officer. A crew member is a person who has been assigned by a carrier to serve aboard a ship, aircraft, barge, or vehicle and has their name listed as such.

Definition of seafarer in International Maritime Labor Law

The word “seafarer” is defined in several existing international labour treaties that were examined throughout the MLC (Maritime Labor Convention) drafting process, and many of them were amended by the MLC. The phrase “seaman,” which is regarded as an equivalent term to the term “seafarer,” is used in the earliest customs. As a result, under Article 1 (1) of the Unemployment Indemnity (Shipwreck) Convention, 1920 (No. 8), the word “seaman” refers to any individual employed on any vessel engaged in maritime navigation. The word sailor is defined in Article 2(b) of the Seamen’s Articles of Agreement Convention, 1926 (No. 22) as “any individual employed or occupied in any capacity on board any vessel and recorded on the ship’s articles.” It does not include masters, pilots, cadets, and pupils aboard training ships, as well as properly indentured apprentices, navy ratings, and other people in the permanent service of a government.

Later conventions use the word “seafarer,” which defines a “seafarer” as any individual engaged in any capacity onboard a seagoing ship to which the conventions apply. Article I (1) (d) of the 1996 Seafarers Convention Recruitment and Placement (No. 179) provides a somewhat different definition: a seafarer is anybody who meets the requirements to be hired or engaged in any capacity onboard a seagoing ship. Some conventions include additional criteria for determining who is a seafarer. Article 1 (7) (d) of the Labor Inspection Convention 1996 (Seafarers) (No. 178) specifies that if there is any uncertainty about whether any groups of people are to be considered seafarers, the central coordinating authority will decide the question after consulting the organizations of ship owners and seafarers concerned. Some ILO (International Labor Organization) treaties leave the determination of the seafarers’ group to the member states’ decision through national laws, regulations, or collective agreements. Some agreements specifically exclude certain groups of individuals from the definition of the seafarer. In its report on duplicative or contradictory text in the existing maritime instruments of the ILO (39 maritime Conventions, a Protocol, and 28 Recommendations), the Tripartite Subgroup of the High-level Tripartite Working Group on Maritime Labor Standards (STWGMLS) (second meeting) on 24-28 June 2002, provides a summary of “seafarer” legal definitions in existing maritime conventions: Sixteen Conventions define the term “seafarer” (seaman), with three pairs of them; Conventions Nos. 22 and 23, 70 and 71, and 164 and 166 – having the same definition.

As a result, there are 13 distinct meanings of “seafarer” in the ILO’s marine Conventions. The varied meanings of “seafarer” serve the diverse purposes and scope of the separate Conventions, and they vary greatly. The variation in the concept relates mostly to the exclusion of vessels on which sailors are employed. Although the definitions of “seafarer” vary significantly across extant labour agreements, the fundamental criteria for a person to be declared a seafarer is their job onboard a ship to which the convention applies. Other requirements are also specified, for example, employment in the deck department, an entry in the ship’s articles. Many ILO agreements are principally concerned with the employment status of people involved in some manner in the operation of the ship, the “crew.”

What is a seafarers employment contract?

Most of the Flag States needed “crew agreements” prior to the introduction of the MLC, which defined the basic conditions of work. Before the vessel could execute the crew agreements the Flag State had to ratify, although a paper was sufficient for all the crew who had been signed while joining and departing the ship. With the arrival of the MLC, all this changed. For almost all aspects of the working circumstances of seamen, MLC stipulates minimum requirements – in fact, a ‘Law of Rights.’ In addition, the signing articles of ships flying the Red Ensign were obsolete when the MLC came into force. Consequently, every seaman operating on a commercial boat must now obtain a Flag State Seafarer Employment Agreement (SEA).

In particular, the MLC mandates that each flag State has, in terms of crew employment, for each crew member a properly recorded and legally enforceable contract rather than a general crew agreement. This is called an employment agreement for seafarers (SEA).

The MLC Regulations state that:

  • Every seafarer has the right to work in a safe and secure environment that satisfies safety standards; 
  • Every seafarer has the right to reasonable working conditions; 
  • According to the MLC Regulations, every seafarer has the right to a suitable working and living environment onboard ship; 
  • Every seafarer is entitled to health care, medical treatment, Payments for welfare and other forms of social support; 
  • The terms and conditions of a seafarer’s employment shall be specified or referred to in a clear written legally enforceable agreement that meets the criteria of the Code.

The SEA is an agreement between a single crewman and the owner, agent, or company owned by the vessel. In most cases, the owner has little participation in the vessel’s administration; because many vessels are owned by a business and managed by a management firm.

It must be written in the crewmember’s native tongue. If the language is not English, a translation into English must be retained on board the ship. The crewmember and the vessel’s employer must sign the SEA, and a copy must be kept by the crewmember as well as a copy onboard the vessel. (The need of having a copy onboard was demonstrated barely two weeks after the MLC went into force when a vessel was detained in Denmark because none of the crew had a SEA.)

What is the relevance of the seafarer’s employment contract?

Since the Maritime Labor Convention (MLC) went into force, mandatory minimum criteria for seafarer employment agreements and wage payment have been adopted internationally. The seamen must sign a contract of employment with both the seamen and the owner of the employer/ship.

Every seafarer working on a British sea-going ship is obligated by the Maritime Labor Convention (Minimum Seafarer Requirements, etc.) Regulations 2014 (S.I. 2014/1613) must have a written SEA with the seafarer/employer detailing the shipyard’s work. A training agreement should be entered into with a training provider for trainees with the sole purpose of working in a navy and receiving training as seamen for the purposes of the Trainers Maritime Shipping Convention (Minimum Requirements for Seafarers, etc.). This training agreement can be considered significantly equal to a SEA.

What are the essential clauses in a seafarers employment contract?

All seagoing ships must have a former employer/shipowner employment agreement. The employment agreements for seafarers should, in all instances, include the following specifics in accordance with standard A2.1 of the MLC:

  1. The complete name of the mariner, date of birth, age and place of birth;
  2. Name and address of the shipowner;
  3. The position in which the seafarer will be employed;
  4. The number of the seafarer’s earnings or, if appropriate, the method used to compute them,
  5. The number of days of paid annual leave;
  6. In the event of temporary agreements, the termination of the agreement and its terms: the date of the agreement’s expiry;
  7. The provision of health and social security benefits given to seafarers;
  8. The right of a seafarer to be repatriated;
  9. If relevant, a reference to the collective bargaining agreement;
  10. Any further information that national law may need, in German law: the date on which the seafarer’s employment agreement is signed, the location and date on which service is begun, as well as the agreed-upon hours of labour and rest;
  11. Before signing, the seafarer must be given the chance to review and seek advice on the employment agreement. The shipowner must make certain that copies of the employment agreement are kept on board for inspection reasons.

The model format for a seafarer employment agreement

This agreement is between:

……………………………………..…….…………………………….

(Insert Seafarer’s full name)

…………………………………..……………………….…….

(Insert date of birth)

…………………………………………….…….…..…….

(Insert place of birth – town and country)

AND

………………………………………………………………………………………

(Insert Ship owner’s name)

………………………………………………………………………………….

(Insert Ship owner’s full address)

CAPACITY IN WHICH SEAFARER IS TO BE EMPLOYED

The first capacity in which you are engaged is ………………………..…………………….. (Insert capacity)

PLACE OF WORK

You will be employed on …………………………………………………..……………..

(Insert the name of the vessel or specify any vessel owned, managed, or chartered by the shipowner)

WAGES

Your pay will be ………………………………………..… (Insert amount and currency) per week/month/year (delete as appropriate) or formula for determining wages

MEANS OF PAYMENT OF WAGES

Your wages will be payable by……………………………. (Insert method of payment) at weekly/monthly (delete as appropriate) intervals on the ………………. (Insert the number) day of each… …………Week/Month (delete as appropriate)

(Overtime hours i.e. Hours performed outside of normal working hours will be compensated at the rate of………………………… (Insert the overtime rate here) (Remove this sentence if it is not applicable)

PAID ANNUAL LEAVE

You are entitled to take ……………………………. In each year of employment, you are entitled to (insert number of) working days as paid leave.

If your employment began or ended during the holiday season, your right to paid annual leave will be calculated on a pro-rata basis. Any paid yearly leave taken in excess of your entitlement will be deducted from your last salary upon the termination of service.

There is no provision for carrying over paid annual leave from year to year. All paid annual leave must be used in the calendar year in which it is accrued. There is also no provision for reimbursement in lieu of untaken leave, save when paid annual leave has accrued but has not been used at the time of job termination.

NOTICE OF TERMINATION OF EMPLOYMENT (Delete whichever is not applicable)

Definite Period Agreement

Your employment is for the period beginning on………………… (Insert date) and ending on…………….. (Insert date), unless it is terminated for justified reasons prior to this point or the ship is at sea at that time, in which case it will continue until the ship arrives in port, at which point it will terminate.

OR

Indefinite Agreement

The amount of notice you must provide to terminate your job is (insert notice period which is to be not less than seven days).

The period of notice you are entitled to from the shipowner to terminate your employment is………………………. (Insert a notice period of no less than seven days.)

OR

Voyage Agreement

Your employment is for the duration of the voyage of [ship] beginning on………… (Insert date) from the port of………………………. (Insert the name of the port) until………………… (Insert date) or the vessel’s arrival in the port of………………………. (Insert port name), at which point it will cease unless terminated earlier for justifiable reasons.

HEALTH AND SOCIAL SECURITY BENEFITS

If you get ill or wounded while on a journey, you will be paid your regular basic pay until you are repatriated in line with the rules for repatriation set down below. After being repatriated, you will be paid……………….percentage (insert number) of your normal basic wages up to a maximum of…………………………weeks (insert the number which must be 16 or higher) less the amount of any Statutory Sick Pay or Social Security Sickness Benefit to which you may be entitled………………….. (Insert number) working days in total in any one sick pay year)

If you require medical attention while onboard, it will be supplied at no cost, including access to required drugs, medical equipment and facilities for diagnosis and treatment, as well as medical information and knowledge. Where possible and appropriate, you will be granted permission to consult a qualified medical doctor or dentist in a port of call for treatment.

In the event of sickness or incapacity, you will be provided with medical care, including medical treatment and the supply of necessary medicines and therapeutic devices, as well as board and accommodation away from home, until your recuperation or your sickness or disability is deemed of permanent nature, for a maximum duration of…………..weeks (insert the number which shall be 16 or above). Furthermore, the shipowner will cover the expense of returning your belongings left on board to you or your next of kin.

If you die on board or ashore during a trip, the shipowner will cover the cost of burial or cremation where appropriate or required by local regulations, as well as the return of any property left on board to your nearest kin.

REPATRIATION

If you are not in your country of residence when this agreement expires, you will be entitled to repatriation at the expense of the shipowner:

  1. By the shipowner.
  2. By you in the case of illness, accident, or other medical condition necessitating your repatriation, if the ship is on route to a Warlike Operations Area, or if your work is terminated or interrupted in accordance with an industrial award or collective agreement.
  3. Under situations when you are no longer able or cannot be expected to carry out your responsibilities under this agreement, such as a shipwreck, the sale of your ship, or a change in your ship’s registry.

The right to repatriation involves transportation via………………… (Insert mode of transportation here) to……………………………………. (Insert place name or country).

Note: In the event that you have been fired on disciplinary grounds or have broken your responsibilities under this Agreement, you may not be entitled to repatriation at the expense of the shipowner. In such cases, the shipowner is still obligated to repatriate you but may deduct the expense of doing so from any earnings owed to you.

Maximum service time length after which you are eligible for repatriation

The maximum term of service after which you will be eligible for free repatriation is……………….months (insert number of months – no more than 12 months).

APPLICABLE COLLECTIVE BARGAINING AGREEMENT(S) (delete if not applicable)

Your employment shall also be governed by the Collective Bargaining Agreement(s) agreed upon………………………………………………………….. (Insert date(s)) between the shipowner and…………………………………………….. (Insert information of the other parties to the collective bargaining agreement(s)) contains additional terms and conditions and is incorporated into this Seafarers’ Employment Agreement, as appended.

HOURS OF WORK

Your regular working hours are…………….. (Insert time) to…………….. (Insert time) from………………………… (Insert day of week) to…………………… (Insert day of week) inclusive.

Your work hours will be structured in such a way that you obtain a minimum of 10 hours of rest each 24-hour period and a minimum of 77 hours of rest per seven-day period. Except in an emergency, this minimal time of rest may not be decreased below 10 hours.

You may be asked to work extra hours during an emergency affecting the safety of the ship, its passengers, crew, or cargo, or the maritime environment, or to help other ships or individuals at risk, at the sole discretion of the Master. You may also be forced to work extra hours for safety drills including musters, firefighting, and lifeboat drills. In such cases, you will be given (a) compensated rest period as a result (s).

COMPLAINTS AND DISCIPLINARY PROCEDURES

(a) Complaints

If you have a complaint about your job, you should follow the ship owner’s complaints procedure, a copy of which will be supplied to you when you board the ship.

(b) Disciplinary Rules and Procedure

Merchant Shipping Law N.106 (I)/2000 on Criminal and Disciplinary Liability of Seafarers lays forth the disciplinary regulations that apply to you.

ADDITIONAL PROVISIONS INCLUDED BY SHIPOWNER

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

Signature of Seafarer

…………………………………………….………………….………………………………..

Signature of Shipowner or Ship owner’s representative ……………………………..

…………………………………………………………………… (State position held)

Place where this Agreement is entered into

………………………..……………………………

Date when this Agreement is entered into

……………………………..…………………………

 References


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Impact of COVID-19 on fisheries and aquaculture

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This article is written by Esha Maken.

Introduction

The pandemic that began with a little tiny creature caused the world a havoc of loss. The effects of this virus have been far reaching, either directly or indirectly. There have been industries, places, living creatures both humans and animals and a lot more than this that have suffered due to the ravages caused by the Covid-19 virus.

 While human life has been the utmost centre of attention for the entire world, there have been many factors and areas that got almost unnoticed while the sufferers of them were still huge and these issues are of paramount importance to be focused upon. 

The global pandemic had been nothing less than a shock for the entire world and while the states at global level were busy curbing its ill-effects, this pandemic was still, somewhere, somehow leaving its mark at various parts, amidst various communities and in various industries and these impacts had been not at all easy to be borne by those who actually had to face them. 

The impact of the Covid-19 on the seafood industry and the aquaculture had been tremendously huge and the people who actually rely solely on seafood, had to go through a lot while the food supply chain got hampered due to the various measures taken while trying to prevent the ill-effects of the pandemic.The hindrances posed as a result of straining the acquisition of inputs due to the deranged exports caused some major negative effects on the aquaculture industries.

In the endeavours to fight the spread the Covid-19 virus, measures like lock down, complete residential stays, bans on travel and movement, diminution of various businesses had to be brought into implementation by various states across the globe and these measures had to be followed with extremities in order to curb the damages caused by the spread of the virus.

But all the emergency manoeuvres taken in the light of safeguarding the health, have caused troubles and hassles in the otherwise normal trade and transportation of various commodities, thereby also affecting the employment of many. While considering the fisheries and aquaculture industry, it has to be noted that the consequences could be very bad as any hindrance caused to the activities revolving around this industry can eventually cause huge shortages and inadequacy of the fish food supply chain and that can have an extensive and profound effect not only hampering the routine lives of the people dependent on this industry but also actually badly breaching the basic human right to food and nutrition of many.

What is Aquaculture?

Aquaculture deals with the process of rearing or farming aquatic animals and plants respectively. In last few decades, this industry is slowly developing and emerging as one of the most transitioning industries as the consumers as well as dependents of this industry are increasing at a high pace. 

Aquaculture is the breedingrearing, and harvesting of fish, shellfish, algae, and other organisms in all types of water environments.

Aquaculture can be defined as the farming of fish and other aquatic organisms, with ‘farming’ implying 

(a) Some form of intervention to increase yields, and 

(b) Some form of private ownership of the stock subject to intervention.

According to the Food and Agriculture Organization of the United Nations, “Aquaculture is the farming of aquatic organisms, including fish, molluscs, crustaceans and aquatic plants. Farming implies some form of intervention in the rearing process to enhance production, such as regular stocking, feeding, protection from predators, etc. 

Farming also implies individual or corporate ownership of the stock being cultivated. For statistical purposes, aquatic organisms which are harvested by an individual or corporate body which has owned them throughout their rearing period contribute to aquaculture, while aquatic organisms which are exploitable by the public as a common property resource, with or without appropriate licences, are the harvest of fisheries.”

Why is it important to look into the aquaculture and fisheries industry?

When we consider the globalised world, there is a copious percentage of the world population that actually rely on the capture fisheries and aquaculture for their daily consumption of food as well as earning a livelihood for themselves and their family. The fisheries and aquaculture industry not only provide employment to a good percentage of the population worldwide but also is a basic source of nutrients, especially for the poor and developing states. 

This industry is also one of the basic and fundamental sources of income for various developing nations. Almost around forty-one million people around the world are dependent on the contributions made by these industries for their livelihood and employment. The fisheries and aquaculture industry contribute immensely in manifold ways. 

This industry interdependently contributes a whole lot to the food as well as nutrition security and the produce from this is the food for the poor and the undernourished for their need of protein. Moreover, for the people in developing countries, the cheap prices of the products actually make it more accessible to them on a daily basis.

There are many parts across the world where fish as their staple diet as well as a healthy nutritious diet is considered to be very crucial. Not only fish products are some of the healthiest and robust protein-rich foods but also cause the least amount of damage when it comes to the natural environment. 

As a result of which, they are quite significant when it comes to the global food security and nutrition strategies at regional, national and global level. Moreover, they have a vital role to play in revolutionizing food systems while also backing in getting rid of and reducing hunger and malnutrition.

The statistics

If we consider the statistics, it will throw light on how important the entire aquaculture industry actually is and that would lead us to believe how any impact on the produce of this can have a great impact on a lot of population around the world.

According to the Information paper, November 2020 by Food and Agriculture Organization of the United Nations, the production of fisheries and aquaculture, in the year 2018, had reached the highest of the all-time as nearly about 179 million tonnes in live weight equivalent was produced during the year with overall capture fisheries being 96.4 million tonnes represented by 54 percent of the total, while aquaculture, with 82.1 million tonnes, accounted for 46 percent. 

The developing nations, primarily Asian countries, have been the highest producers and among them, China, Indonesia, India, Viet Nam and Peru were the key producers in 2018.

Out of the total fish production, approximately 89 percent is utilised and subjected to human consumption while the other remaining part to be utilised for non-food uses out which about approximately 45 percent of fish for human consumption is vented in live and fresh form. 

Interestingly, during the last few decades, the world per capita fish food consumption has escalated dramatically, the figures being from 9 kgs during the 1960s to approximately 20.3 kgs during the year 2017. Fish consumption is reported to be seventeen percent of the total world’s population intake of animal proteins globally. 

All these data prove how significant the industries’ produce actually is to the globalised world that we reside in. Apart from the fact of it is highly demanded by the food population, the countries across the world are very much interdependent on each other when it comes to this industry as the production, the process and the consumption is not always carried on by a single country. 

Thus, there is a huge amount of population that is actually relying on this industry for their consumption of food and thus this industry plays a major role when it comes to food security around the world.  

While the globalised trade has provided an edge to many industries, the fisheries and aquaculture industry have benefitted from it too, for the world trade has impacted the fish and fish products immensely making them the most traded food commodities at the global level with the export of total ship production being about 38 per cent. This has not only helped the producers of this industry but also the consumers as they get varieties and choices while consuming their daily food. 

As the evolving technology and maritime trade became a factor for the growth of the industry, there has been a stable and increasing demand for the products since the last few decades. People have started depending on the industry more and more. Moreover, with the increasing population, the increase in income of the people, urbanization and many such ancillary factors, the consumption is expected to keep increasing making it important to focus on this industry and make sure to make its supply meet the demand.

Impact of covid 19 on Aquaculture

The Covid-19 pandemic has affected the world in unimaginable and unrepairable ways and while the world is still fighting a battle against this pandemic, it becomes necessary to study and analyse the effects it has caused on various industries in order to curb them as well as bring solutions to them. 

Due to the pandemic and the measures taken for preventing the same, there has been a huge effect found on the production along with market disruptions due to the hindrances in the continuous flow of supply. 

In order to carry out smooth and easy fisheries and aquaculture activities, it becomes necessary that all the stages coming under its ambit are followed appropriately. The stages and activities like production, processing, transportation and distribution of both wholesale as well as retail market are some of the very fundamental and important activities that need to be functioned and implemented well in order to see that the production reaches the end-users and each of these play a vital role in order to be assured about the favourable outcomes through the expected supply chain. 

But given that the coronavirus pandemic had left no stone unturned in affecting the world at large, there has been a significant amount of halt and disruptions caused to these enlisted activities, thereby making it difficult to actually achieve the end results. The lockdowns at various places announced as a part of the measures to curb the reach of the virus has actually affected this industry in many ways and most of them being negative in nature.

The effects are not only limited to the disruptions in supply and transportation but also the overall lifestyle of the people and community who are actually dependent on this industry. There has been losing of employment for many while food security still remains the major issue and matter of concern. Many households have been observed facing financial issues while also trying to reduce their spending in order to increase the savings but all this imbalance in the otherwise on-going transactions have affected the entire industry badly.

The consumers as well the producers have been seen suffering through this a lot. As the demand for the product decreased, it had a direct impact on the production, processing and distribution not only on a regional or national level but also at an international level around the globe as the supply chains were hit hard due to the closure of various services caused due to the lockdown at various places. 

The regions dependent on tourism for their incomes and the supply were also highly affected. Adding to the already existing state of worries was the fact that perishable produce was also in a way causing hurdles to the overall supply chain.

The problems faced by this industry can also have an impact on the stock fishing which can actually hamper the sustainable fishing goals and cause a major hindrance in securing the rights of the future generation as well as the protection of the marine creatures which are the main products of this industry. 

The population depending on this industry for its employment and daily wages have been affected badly too and while all of these facts seem saddening, the reality is even more distressing. 

There are many nations including developing ones and small island nations around the world that solely are dependent on these industries and the halt on the imports and exports at the international level has also caused anguish and suffering to the people, population, communities and countries dependent on this industry at large. While malnutrition and lack of scarce resources have always been a few of the problems of the developing nations, all the resulting consequences of the pandemic has added to the worrisome state of these nations.

Looking at the legal side

The activities of the aquaculture industry need to be studied under the legal lens as it is not only a developing industry but also has a very wide scope when it comes to its impacts on the states around the world. The various activities included under its ambit is believed to be the focus area of many marine-oriented researchers, lawyers and environmentalists. 

The activities not only provide for various communities of the world but also use the marine environment and ecosystem while meeting the end results and therefore the legal issues it raises has to be considered while studying this industry.

Aquaculture is very closely related to the environment while also having major impacts and dependence on the land as well as aquatic species resulting in various environmental changes. 

The far-reaching impact that the activities of this industry are having on different areas and species makes it look like its impacts are in a way omnipresent, either directly or indirectly and therefore looking into the legal aspect becomes important and necessary so as to protect the interests of all. 

Thus, there is an inclusion of provisions regarding the management, build-out and regulation of this industry that has been made in various legal documents thereby making it backed by legal sanctions and regulations. 

Since any changes and disruptions caused in this industry affects directly or indirectly at regional, national as well as international level, the legal measures necessarily are meant to be taken. Legally implementing the policies can give long term and effective results. Moreover, legal backings can always give an edge over otherwise accepted norms in order to get expected positive results. 

The Food and Agriculture Organization of the United Nations acts as the regulatory authority for overseeing the fisheries and aquaculture industry at the international level. It provides for legal advice and assistance to the member nations while also providing for the legislation with the view to ensure development as well as contributing to national efforts towards realising and achieving the Sustainable Development Goals.

Recommendations

In order to see that the users and consumers of this industry don’t stay on a losing side, we need to make sure that certain restrictions for this industry are actually reduced and eased. The fishers, the aquaculture workers and the employees connected with this industry should be considered as essential frontline workers as they provide the basic source of life i.e., food to many communities around the world. 

We must remember and acknowledge the fact that there are numerous nations across the globe that are actually dependent on the fish products and fishery industries for their basic fundamental incomes as well as consumer needs. There must be certain liberty and privileges provided to the migrant workers working in the seafood industry so as to make sure that the easy flow of the transactions and transport of the fish products and fish commodities is maintained. 

This can not only help in keeping the employment of poor wage labourers intact but also ensure the availability of proper stock at least to meet the demand to some extent.

If certain monetary and health incentives are provided to the families which are dependent on this industry and earning a daily minimum wage can also help them to an extent to live the bare minimum healthy lifestyle required for their wellbeing. 

There is a need to collect and analyse data in the same sector about the drastic changes taking place in the demand and supply so as to formulate strategies for filling the huge gaps. There is also a need for better laws that could actually provide for stringent legislative and regulatory policies and this area gets protection from the law. Currently, this industry merely is seen as an economic benefit by the states but it becomes essential that this industry is now seen as the source for the basic daily requirement of food consumption. It is high time that we start considering this industry as the essential one and not merely a source of income. 

There are also certain communities and classes of people who are vulnerable even in normal circumstances and the Covid-19 pandemic has made the situation even worst. It is necessary that food security and job security measures are immediately taken for the people belonging to these categories in order to avoid the loss of human lives because this pandemic has affected them really very bad and it becomes inevitable for the state to implement policies which can secure their interests and save them from the future loss and damages.

Conclusion

It is high time for us to consider the aquaculture industry as an inevitable one and take stringent measures so as to reduce the hindrances coming in the way of its growth. The hurdles faced by this industry will not only cause problems for the humans associated with it but also to the marine creatures and environment as sustainable aquaculture can never be maintained in crucial circumstances. This will raise issues for the future generations while the current generation might get away with little damages.

As the nations around the world are slowly reviving to normalcy while the curve getting flattened and Covid-19 cases coming to a decline, the after-effects of the pandemic are slowly coming to light and the picture is not good. 

There are many industries like fishing and aquaculture that has been ignored or maybe completely avoided while considering the measures for combating this exceptionally dangerous situation of the pandemic.

The states must consider the human rights-based approach while considering various policies and strategies so as to protect the interests of the poor and marginalised wage-based labourers and also the vulnerable groups of society. 

A pandemic like this do not hit the world very often but we never know what the future has in store for us and therefore being prepared is the best possible strategy for combating future pandemics and taking this one as a lesson, we must consider being alert and ready with policies which can actually help the majority classes of the people. 

References

 Manlosa, A.O., Hornidge, AK. & Schlüter, A. “Aquaculture-capture fisheries nexus under Covid-19: impacts, diversity, and social-ecological resilience”, 20, Maritime Studies, 75–85 (2021). 

 National Ocean Service, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

M.C.M. Beveridge, D.C. Little, “The history of aquaculture in traditional societies”,B.A. Costa-Pierce (Ed.), Ecological Aquaculture: The evolution of the Blue Revolution, Blackwell Science Limited, Oxford (2002)

Cambria Finegold, “THE IMPORTANCE OF FISHERIES AND AQUACULTURE TO DEVELOPMENT”,2, The WorldFish Center, 353-364 (2009)

Ben Belton, Shakuntala Haraksingh Thilsted, “Fisheries in transition: Food and nutrition security implications for the global South”, Volume 3, Issue 1, Global Food Security, Pages 59-66, ISSN 2211-9124, (2014)


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Achieving Universal Healthcare through Inclusive Legal Frameworks

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This article is written by Samridhi Shukla who is a student at Hidayatullah National Law University, Raipur. 

Abstract

The COVID-19 pandemic has shifted the entire world’s focus onto healthcare. As leaders across the globe struggle to reach the ideal of universal healthcare for all, we are often compelled into thinking- can healthcare be defined by a fixed number of parameters? Does it only entail medical treatment, or does it also include more diverse implications? What role does law play in administering healthcare? 

And finally, are our legal frameworks prepared enough to recognize and work upon the issues of availability, accessibility and affordability when it comes to medical care? The author seeks to examine laws and policies in place in 21st century India by putting them into broader socio-economic contexts existing in the country and forwards a more nuanced approach to healthcare and policy frameworks surrounding it that identify and respond to the special needs of socially and economically vulnerable communities in order to make current legal systems more holistic and inclusive, in both letter and spirit.

Introduction

Over the past few decades, scientists across the globe have been raising red flags against the grave repercussions land exploitation and human expansionist strategies can lead to. As we invade and destroy natural habitats and erect scintillating new cities, towns and industrial complexes every day, we often tend to forget that this era of rapid globalization comes with its own costs- frequently occurring global health pandemics being one of them. 

Hence, apart from issues of environmental sustainability, another crucial question thrown at us centers itself around the level of preparedness of our healthcare systems, and whether the State guarantees its citizens an equal footing and access to these.

In December 2019, a novel zoonotic virus known as the ‘coronavirus’ began to spread aggressively in the Wuhan city of China. By March 2020, the case count had already crossed way beyond the 1 million marks. 

As the disease mushroomed in over 114 countries killing thousands of people in its wake, the World Health Organization hastily declared the outbreak as a global pandemic on the 11th of March 2020.  During the press briefing, the Director-General heavily pressed upon the significance of human rights in ensuring healthcare and the welfare of citizens. 

Now, this correlation may push several of us into thinking- what do human rights and law have to do with healthcare? Do public health systems require a deeper societal evaluation than just the availability of physical paraphernalia, facilities and equipment? 

The Constitution of the World Health Organization (WHO) envisages health as a state of complete physical, mental and social well-being and not merely the absence of disease or infirmity. This essentially means that the concept of health and the systems surrounding it do not function in isolation. They incorporate within them broader socio-economic implications that either facilitate or hinder an individual or community’s right to health and access to healthcare. 

In the 21st century India too, the concept of public health has grown to be extremely nuanced and multi-faceted in nature. There exist several structural and functional imbalances that make access to healthcare exclusive in our market-friendly democracy. It is thus important for the Indian State to identify these disparities and build socio-legal systems that are well-rounded and sensitive to the needs of vulnerable and marginalized communities. 

The healthcare systems have come to be dominated by private players after the rapid neo-liberal reforms dating back to the early 1990s. However, the booming medical tourism sector and almost lavish, 5-star hospitals have a rather dark underbelly. 

As the government continues to shift its citizens’ fundamental right to health onto corporations selling healthcare for profit, the common man is slapped with exuberantly high costs on one side and a perpetually overworked and understaffed public sector on the other. While the country’s case fatality rate (CFR) is at a mere 2% compared to that of the West, it would be naïve to assume that the disease’s spreading has been brought under control by the authorities. 

A closer look at the situation points to a different reality. According to statistics, while China’s count of deaths per million due to COVID-19 is just 9, India is at a worrying 2324. 

We shall now condense and fit issues stemming from diverse cross-sections of the Indian society in terms of the ‘four As’ that is, availability, accessibility, affordability and acceptability and further examine how inclusive Indian law and policy is at present to provide universal healthcare and whether it can be enhanced and enriched in holistic ways to ensure a more inclusive system that serves true justice to the people of this country. 

Bolstering Archaic Laws to conquer newer challenges

In the late 1890s, colonial India was plagued by a deadly bubonic illness that devastated both the social and economic capital of the country within weeks of its emergence. It was then that the government introduced the Epidemic Diseases Act of 1897.

Section 2A of the Act gives the Central Government sweeping powers to formulate and implement rules and regulations necessary to contain the spread of the epidemic, while Section 2 provides State governments with the discretion to adopt special directives to adequately respond to the outbreak. 

This includes restriction of movement of goods and people, social segregation of infected persons, prohibition of religious pilgrimages and the like. 

However, the Act proves to be redundant in 21st century India due to several pertinent reasons. Firstly, the colonial piece of legislation bequeaths a very monolithic, all-powerful status to the government. While this might have suited the economic and political conditions existing when the Act was first brought out, it fails as a law being exercised in today’s laissez-faire economy. 

The rapid privatization of the medical sector has led to the slow death of public health infrastructure with economically marginalized sections of society being at their receiving ends. As more and more corporations take over the government’s job of ensuring equitable healthcare, its primary purpose shifts from the welfare of the public to that of maximization of profit. 

This phenomenon has come to be known as the medical-industrial complex. By commodifying something as indispensable to human survival as healthcare and viewing patients not as a valuable asset to society but as potential consumers of a profitable good, these companies put individuals’ right to life and human dignity in a precarious position. 

Policies of liberalization have successively peddled the illusion that financial allocation to the public healthcare system is a waste of resources and the economic capital of the country. The brunt of this dangerous hypothesis is being borne by the common people of this country today.

According to a recent report by the World Health Organization, India extended a mere 1.1% of the GDP towards healthcare in the year 2019. The paucity of funds inevitably reflected in the absolute chaos public health dispensaries was thrown into when the pandemic first struck. 

Patients seeking treatment were simply turned away from government hospitals due to lack of space, beds and equipment. Instead of owning up to the major discrepancies in the administration of medical care, these hospitals chose to delay or completely evade diagnostic testing, leading to a sharp rise in deaths that could have been easily avoided if the patients were tested and given timely medical attention. The non-availability of public healthcare automatically affected people’s right to its accessibility. 

Helpless and desperate, several family members of critical patients turned to social media to appeal to hospitals to take them in. As the case count skyrocketed, people were made to wait for days on end to even enter hospital premises. In Pt. Parmanand Katara v. Union of India it was held that no person shall be denied medical attention when they are in urgent need of it. Further, the Court maintained that it was the state’s obligation to preserve human life. This judgement happens to fall in sharp contrast with the harrowing realities the current pandemic has created for millions of Indians. 

While certain privileged sections of the society were able to overcome this predicament by getting treated in private hospitals charging exorbitantly high fees, economically weak sections who weren’t covered under health insurance schemes were left to fend for themselves and their families.

As of May 2020, the total percentage of unemployment in the country stood at a whopping 24%. The insecurity induced by the pandemic led to mass job terminations in the private and unorganized sectors, pushing economically backward classes into an even deeper state of deprivation, limiting their access to healthcare almost completely. 

This tragedy was most visible during the migrant crisis this pandemic gave rise to. On losing their jobs in cities, labourers and daily wage earners were left with no other choice but to return to their native villages and towns. Due to a lack of transportation facilities, they began travelling by foot in huge groups. 

Far from ensuring their right to healthcare, they were treated worse than livestock. Dehumanized, they were sprayed with chemicals and stripped of their fundamental right to dignity. By the time the Central and State governments swung into action, hundreds had already succumbed to starvation and disease. 

Healthcare does not only include the treatment of an illness. It also entails other equally instrumental factors like the right to food, transport and employment. Universal healthcare can only be achieved when the means to access medical care such as financial and social capital are sufficiently met. 

 By sidelining public health and denying access to healthcare to the people of this country, the government has failed in performing its obligation of protecting the fundamental right to life as enshrined in Article 21 of the Indian Constitution. In the landmark judgment of Paschim Banga Khet Mazdoor Samity vs State of West Bengal (1996), the Supreme Court held-

“Article 21 imposes an obligation on the State to safeguard the right to life of every person. Preservation of human life is thus of paramount importance. The Government hospitals run by the State and the medical officers employed therein are duty-bound to extend medical assistance for preserving human life. Failure on the part of a Government hospital to provide timely medical treatment to a person in need of such treatment results in violation of his right to life as guaranteed under Article 21.”

The scope of the 1996 judgement was further widened with the State of Punjab vs Ram Lubhaya Bagga and Rakesh Chandra Narayan vs State of Bihar. Both called for the need to read Article 47 under Directive Principles of State Policy along with Article 21 to ensure improvement of public health and standard of living. Through all these cases, the judiciary has consistently underscored the pivotal role healthcare plays in protecting the citizens’ Right to Life. 

It thus falls upon the State to adequately compensate the families and dependents of individuals who lost their lives due to a blatant dereliction and negligence of its constitutional duty. Secondly, instead of releasing relief packages for the currently unemployed, the government should focus on nourishing already existing schemes such as the MNREGA that provide for the social and economic security of people. Proper implementation of their ‘right to work’ may also augment accessibility and affordability to healthcare.

A few days back, the top Court issued firm directions to the centre to regulate COVID testing charges. Remarking on the lack of uniformity among states, the bench observed, “In some states it is ₹ 2,200 and in some its ₹ 4,500”. It is imperative for the centre and states to coordinate and fix a mutually agreed upon price for private testing to ensure it remains accessible and within the limits of an already strained common man’s pocket. 

Another rather perturbing issue that surfaced during the pandemic was the violation of citizens’ right to a dignified death and burial. Several videos of bodies of deceased patients being ruthlessly dumped into pits and reports of bodies ‘piling up’ in hospital mortuaries. One the most shocking ones was that of an octogenarian patient ailing from Covid being tied to the bed with chains over alleged non-payment of bills. 

While the contagious nature of the virus is such that it necessitates a higher degree of patient isolation, the state should respect people’s right to dignified death under Article 21 of the Constitution. Moreover, certain traditional practices are integral to individuals’ religion, and violation of these beliefs lead to a direct violation of Article 25 that entitles a person to inter alia freely practise religion barring the exception of public order, morality and health.

Apart from availability, accessibility and affordability, the factor of ‘acceptability’ is equally important. The World Health Organisation defines acceptability in administrating healthcare as ‘health workforce characteristics and ability (like sex, language, culture, age, etc.) to treat all patients with dignity, create trust and promote demand for services.’

The Calcutta and Karnataka High Courts took due cognisance of this. Respecting the citizens’ emotional and religious sentiments, the Calcutta High Court held, “The traditional belief in our country is that unless the last rites are performed before the burial/cremation, the soul of the deceased shall not rest in peace. 

This belief is deep-rooted in our country. It also has an emotional and sentimental aspect.” The Karnataka High court, while directing the state government to come out with strict guidelines held- “the dignity of the dead must be respected.”

The gaping question of accessibility for the marginalized 

Another major lacuna in the legislation currently in place to tackle the pandemic is that they fail to take cognizance of specific needs of marginalized groups of the society such as women, Dalits, Adivasis, Muslims, the LGBT+ community and people from the Northeast- several of them finding themselves at the treacherous intersection of two or more of these vulnerable identities.

Section 3 of the Protection of Women from Domestic Violence Act, 2005 opens up a wide ambit for protecting victims of abuse’s physical and mental health and wellbeing. It defines abuse as any act or omission as one that ‘harms or injures or endangers the health, safety, life, limb or well-being, whether mental or physical, of the aggrieved person or tends to do so and includes causing physical abuse, sexual abuse, verbal and emotional abuse and economic abuse.

With the spread of COVID-19, victims of domestic abuse, the majority of them being women are faced with an unprecedented spike in violence, putting their health in a treacherous pool of inaccessibility and vulnerability. 

As per a United Nations report, cases of domestic violence rose by 20% worldwide during the lockdown period. While the Delhi High Court issued directions to the AAP government to implement the Protection of Women from Domestic Violence Act, 2005 in April this year, these directives lack uniformity. What we must understand is that most of these victims live in close proximity to their abusers. 

The government must give heed to their circumstantial limitations and adequately frame guidelines. These could include funding Non-Governmental Organizations already working to prevent violence against women, who in turn can use these grants to form rescue teams, set up local emergency booths, print pamphlets to spread awareness and educate women of their rights, distribute mobile phones to women, et cetera. 

A committee can be created to monitor and prevent the misappropriation of these funds. Another crisis they are facing right now is a threat to their reproductive rights and access to maternity healthcare. Several reports have emerged of women giving birth on Shramik trains. This causes a manifold increase in the possibility of infection and death. 

Women in rural and tribal areas are unable to access essentials like sanitary napkins and contraceptives due to lack of availability of these goods and delivery services. Hospital visits and maternity check-ups have come to a halt due to lack of transportation and fear of contracting corona. 

In India, Nurses and midwives constitute 83.4% of the total workforce of the medical sector. This essentially means that women not only face vulnerability as patients, they also face a high risk of infection as healthcare providers. Throughout the pandemic, reports of hospitals lacking Personal Protective Equipment (PPE) kits, sanitisers and disinfectants kept coming in. 

When the government refused to release data on the number of healthcare officials that had succumbed to the virus, often due to poor equipment, the Indian Medical Association came out with a list of total 382 frontline workers who had died of coronavirus as an act of protest against insufficient funds and unaccountability from the executive’s side. 

Very recently, around 5000 nurses went on an indefinite strike against certain new policies the AIIMS administration came out with, outsourcing of nurses being one of them. The process of contractualization has almost always led to the worsening of the conditions of the working class. 

Since women bear a disproportionate risk of infection, a gendered perspective must be adopted to protect their fundamental right to life and access to healthcare.

There was a huge spike in the number of cases of racial discrimination and violence against people from the Northeast during the pre-lockdown period. The fear of being hounded in public places including hospitals made healthcare virtually inaccessible for them. 

A woman from Meghalaya was forced to give birth in an ambulance after being prohibited from entering any hospital in the city of Shillong on grounds of belonging to a marginalized tribal community. 

The Indian society has a unique intersection of class and caste oppression. Despite government reservations, deep-rooted systematic hindrances in access to education and employment have ensured that a huge portion of their populations remains engaged with menial physical labour. 

Most casual labourers working in cities belong to lower caste backgrounds. Social and political apathy towards them has led to a gross violation of their right to life, livelihood and access to healthcare during the pandemic. 

A majority of sanitation workers including those working in hospital wards belong to Dalit and Adivasi communities. Despite the pandemic, their socio-economic conditions compel these people to carry out their jobs with no protective gear and minimal awareness in order to survive. 

Reports of Dalit migrants not being allowed to enter their villages or use main streets and roads bare the cruel face of the caste system thriving in modern India. In May this year, the Chief Minister of Uttar Pradesh, commenting on the migrant crisis said that 75% of the migrant workers were carriers of the disease, adding that a bulk of them were Dalits. Not only is this statement blatantly antipathetic and fallacious, it also strikes at the heart of Article 14, 15 and 21 of the Constitution. 

The queer and transgender communities also stand to be doubly disadvantaged due to the pandemic. Most transgender people in the country earn their living through begging or Commercial Sex Work (CSW). As the lockdown prevented them from carrying out either of the activities, their access to basic needs like food, shelter and healthcare have been severely affected. 

A case study carried out in 2014 showed how most people belonging to the queer community are unemployed and thus are likely to live in impoverished conditions in India. The stigma around their gender and sexual identity costs them their fundamental right to life, human dignity and livelihood, invariably affecting their right to healthcare as well. The pandemic has left them even more socially vulnerable and at a greater risk of contracting the disease due to improper living conditions and lack of access to medical care.

Another socially and politically marginalized community that bore the brunt of this pandemic is the Indian Muslim community. The country had witnessed a string of communally tinged legislations months before the coronavirus shook up the nation. However, far from acting as a conflict dispeller, the pandemic has only acted as a catalyst in entrenching the stigma around Muslims. 

The community has been demonized and used as a scapegoat on several occasions. This sub-humanization has hindered their access to healthcare. Instead of being given proper medical attention, Muslims involved in minor wrongdoings and breaches of civil law before and during the lockdown have been parroted as terrorists, disease-spreaders and ‘anti-nationals’. 

This hyper nationalist rhetoric has deliberately led to the ostracization of the community and prevented them from exercising their right to healthcare and human dignity. 

Social stigma and exclusion result in the individual’s mental health plummeting. While the government has started helpline numbers for students facing mental health issues due to the pandemic, it must also recognize and cater to the mental healthcare of socially marginalized communities in order to ensure their welfare. 

The way forward 

In Vincent Parikurlangara v. Union of India, Justice Mishra rightfully observed that a healthy body is the very foundation of all human activities, and in a welfare state it is the obligation of the state to enforce the creation and sustenance of conditions of good health. In Ram Lubhaya Bagga, the Court followed a similar trajectory and held-

“..The right of one is an obligation of another. Hence the right of a citizen to live under Article 21 casts obligation on the State.” Further bolstering this stance the bench highlighted the importance of Article 47 in striving to protect and preserve life-

 “(This obligation) is further reinforced under Article 47, it is for the State to secure health to its citizen as its primary duty. No doubt government is rendering this obligation by opening Government hospitals and health centres, but in order to make it meaningful, it has to be within the reach of its people, as far as possible, to reduce the queue of waiting lists, and to provide all facilities for which an employee looks for at another hospital. 

Its up-keep; maintenance and cleanliness have to be beyond aspersion. To employ best of talents and tone up its administration to give effective contribution. Also bring in awareness in welfare of hospital staff for their dedicated service, give them periodical, medico-ethical and service oriented training, not only at then try point but also during the whole tenure of their service. 

Since it is one of the most sacrosanct and a valuable rights of a citizen and equally sacrosanct sacred obligation of the State, every citizen of this welfare State looks towards the State for it to perform its this obligation with top priority including by way allocation of sufficient funds. This in turn will not only secure the right of its citizen to the best of their satisfaction but in turn will benefit the State in achieving its social, political and economic goal.”

Healthcare is not just strategizing disease prevention drives. It inter alia carries the right to human dignity, right to food, shelter and employment and right against discrimination within its ambit. Hence, we must adopt a multi-layered perspective to assessing healthcare policies and build on them by drawing in various socio-cultural standpoints. 

During the COVID19 pandemic, the government has for the most part failed to acknowledge and adequately respond to systemic biases that exist in the socio-economic scenario of modern-day India. It has failed in identifying underlying inequalities, hierarchies and vulnerabilities that shape individuals’ and communities’ capacity to endure a health crisis. 

It is however not too late. As we gather lessons from this pandemic to ready ourselves for the possible occurrence of the next one, it is imperative for the lawmakers of this country to reorient policies and legal frameworks towards specific needs of those who exist on the periphery of our country’s social and political landscape. 

As Kenneth Roth, Executive Director of the Human Rights Watch very eloquently puts it and I quote, “As governments scale up their public health response, the threat posed by COVID-19 is reason to affirm, not abandon, everyone’s rights.” We hence must work in solidarity with the marginalized towards a healthcare system that is holistic and all-inclusive in nature. One that protects all and discriminates against none.

References:

WHO Director-General’s Opening Remarks at the Media Briefing on COVID-19 (World Health Organisation, 11 March 2020)  https://www.who.int/director-general/speeches/detail/who-director-general-s-opening-remarks-at-the-media-briefing-on-covid-19—11-march-2020.

Arnold S. Relman, ‘The New Medical Industrial Complex’ (New England Journal of Medicine, 23 October 1980) https://www.nejm.org/doi/full/10.1056/NEJM198010233031703.

World Health Organisation, Global Spending on Health: A World in Transition (2019) https://www.who.int/health_financing/documents/health-expenditure-report-2019.pdf?ua=1

Centre for Monitoring Indian Economy, Unemployment Rate in India (2020)

https://unemploymentinindia.cmie.com.

Coivd-19 Victims Have a Right To Decent Burial As Per Religion under Articles 21 and 25: Calcutta HC Issues Guidelines (LiveLaw, 17 Sept 2020)

https://www.livelaw.in/news-updates/covid-19-victims-have-a-right-to-decent-burial-as-per-religion-is-part-of-articles-21-and-25-calcutta-hc-issues-guidelines-163074.

Karnataka HC Asks State to Frame Guidelines to Ensure Dignity of the Dead, Wages for Sanitation Workers (Bar&Bench, 28 Jul, 2020)

https://www.barandbench.com/news/litigation/karnataka-high-court-state-government-guidelines-dignity-dead-bodies-wages-sanitation-workers.

Phumzile Mlambo-Ngcuka, ‘Violence Against Women and Girls: The Shadow Pandemic’(April 6, 2020),

https://www.unwomen.org/en/news/stories/2020/4/statement-ed-phumzile-violence-against-women-during-pandemic.

World Health Organisation, Sudhir Anand and Victoria Fan, The Health of Workforce in India (Human Resources for Health Observer Series No. 16, 2016)

https://www.who.int/hrh/resources/16058health_workforce_India.pdf.

Harshit Agarwal, IMA Publishes list of 382 Doctors Who Had Died Due to Covid-19, Demands they be Treated as Martyrs’ (Hindustan Times, 17 September 2020)

https://www.hindustantimes.com/india-news/ima-publishes-list-of-382-doctors-who-died-due-to-covid-19-demands-they-be-treated-as-martyrs/story-hX0ELsr0LXk8UnBFQ0kIvJ.html.

‘Meghalaya Woman Denied Entry Into Hospital Gives Birth in Ambulance’ (The Sentinel, 10 July 2020)

https://www.sentinelassam.com/north-east-india-news/meghalaya-news/meghalaya-woman-denied-entry-into-hospital-gives-birth-in-ambulance-487926?infinitescroll=1.

‘Adityanath Remark on Migrant Leaders misleading, Anti Dalit’ (The Hindu, 26 May, 2020)

https://www.thehindu.com/news/national/other-states/adityanath-remark-on-migrant-workers-misleading-anti-dalit-congress/article31677986.ece.

M.V. Lee Badg

Bolstering Archaic Laws to conquer newer challenges

ett, The Economic Cost of Stigma and Exclusion of LGBT people: A Case Study in India (World Bank, 2014) https://openknowledge.worldbank.org/handle/10986/21515.

Joanna Slater and Niha Masih, ‘As the World Looks for Coronavirus Scapegoats, Muslims are Blamed in India’ (The Washington Post, 23 April 2020)

https://www.washingtonpost.com/world/asia_pacific/as-world-looks-for-coronavirus-scapegoats-india-pins-blame-on-muslims/2020/04/22/3cb43430-7f3f-11ea-84c2-0792d8591911_story.html.


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South China Sea conflict : the dispute and India’s claim

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South China Sea Conflict
Image Source: https://rb.gy/fl2eez

This article is written by R Sai Gayatri from Post Graduate College of Law, Osmania University. This article deals with the South China Sea conflict and its effect on India. 

Introduction

The South China Sea (SCS) conflict is a multinational dispute going on between China, Taiwan, the Philippines, Brunei, Malaysia, and Vietnam. The South China Sea is the most important water body for the said countries as it is the only waterway that provides them with merchant shipping and trade. These countries are all situated in the Indo-Pacific region which is one of the principal reasons for the dispute as they all claim maritime and island ownership over the South China Sea. Through this article, let us know more about the South China Sea conflict and how India is connected to it.

A brief history of the South China Sea conflict

Some of the islands in the South China Sea were under the colonial authority of the French. However, during World War II, the Imperial Japanese Army and Navy made use of various islands for military purposes and mentioned that the said islands were not claimed by any country. The Treaty of San Francisco in 1951 put an end to the control of Japan on all such territories which were conquered by it during the said war. At the same time, China got involved in this matter during the said Treaty’s negotiations in 1951 and claimed rights over the concerned islands.

China never shied away from claiming the islands. It all started in 1947 with the eleven-dash line demarcated by the Kuomintang government of China. Later in 1949 when the People’s Republic of China was formed the eleven-dash line was renamed and adopted as the nine-dash line. The Declaration of 1958 mentioned the claims of China upon the South China Sea islands as per the nine-dash line. The military and government officials of the People’s Republic of China provided a historical basis to their claim over the South China Sea through the nine-dash line.

The main islands i.e the Paracels and Spratlys were to be considered as a part of Vietnamese territory as per the Geneva Accords of 1954. The said Accords marked the end of the first Indo-China war and provided South Vietnam with the authority over those Vietnamese territories that were to the south of the 17th Parallel. However, in 1956, it was stated by North Vietnam that the islands must be claimed by China and not South Vietnam.  

Countries concerning the South China Sea conflict

The following countries have made various claims over different parts of the South China Sea –

China

As already mentioned above, China claims its ownership over the South China Sea based on the nine-dash line and other ancient historical records. The country states that it had the sole authority over the whole of the South China Sea and the conflicts began with other countries lately. China also tried to state its legal rights over the South China Sea, however, all its attempts proved to be futile as it could not establish its claims.

Philippines

Just like China, even the Philippines claims its rights over the South China Sea based on historical records. However, they do not claim rights over the whole waterway but just that area that falls under their Exclusive Economic Zone.

Brunei

This country claims its rights over the South China Sea on the grounds of the Exclusive Economic Zone. The concept of the Exclusive Economic Zone was established by the United Nations Convention on the Law of the Sea (UNCLOS).

Indonesia

Located just beside Brunei, Indonesia also has claimed its rights over the South China Sea based on the concept of the Exclusive Economic Zone. It claims only that part of the Sea that falls under Indonesia’s EEZ.

Malaysia

This country approaches the South China Sea conflict exclusively on legal grounds. It states that the southern part of the Spratly Islands is located inside the Malaysian continent and so its claim over the said part of the South China Sea must be legally acceptable.

Vietnam

The strained relations between Vietnam and China led to Vietnam claiming its rights over the South China Sea in the 1970s. The claims made by this country are based on the grounds of inheritance.

Causes of the South China Sea conflict

The following are the causes for the South China Sea conflict affecting the relations between China and the Association of Southeast Asian Nations (ASEAN)

Exclusive Economic Zones (EEZ)

The South China Sea conflict is also fuelled by the exclusive economic zones. Most of the countries involved in the conflict based their claims on the grounds of an exclusive economic zone. This means that they are claiming their rights over the South China Sea only to the extent of their exclusive economic zone and not beyond that.

Natural resources

The South China Sea is said to be rich in crude oil and natural gas. If the whole control of the said Sea is under a single country then it would definitely dominate over the other countries in matters of trade and export. Therefore, the countries involved in the dispute are specifically concerned about the extraction of these natural resources as well.

Claims over the South China sea

All the nations surrounding the South China Sea are claiming rights over various parts of it. These nations include China, Taiwan, the Philippines, Brunei, Indonesia, Malaysia, and Vietnam. While one country claims its rights based on history the other claims its rights based on the concept of the economic zone. The demarcation of the South China Sea as per the territories is also one of the main reasons for the conflict.

Islands

The islands of the South China Sea have been claimed by the countries involved in the dispute. This leads to further conflicts in the trade as the waterway passes through these islands where the ships might be seized.

Fishery

The South China Sea forms a major part of the fishery of various countries involved in the conflict. Seafood is considered the staple food of the southeast Asian countries and the South China Sea is an essential source for acquiring such seafood. Thus, the countries concerning the conflict consider it a threat to let one nation have control over the South China Sea. 

Effects of the South China Sea conflict

The South China Sea conflict has varied effects on both – the countries involved in the conflict and the other countries that have trade links with them. The South China Sea route plays a key role in international trade, so any hindrance in it would affect the economy of the countries directly or indirectly related to it. The said conflict must be settled amicably so that there will exist harmony among the nations and smooth running of international trade.

India and the South China Sea conflict

In 2014, India and the United States of America pronounced a joint statement under the ‘Act East’ policy. It was stated by both nations that a resolution pertaining to the territorial and maritime disputes must be pursued through peaceful means adhering to the globally recognized standards of international law which include the United Nations Convention on the Law of the Sea. Further, the statement also threw light upon protecting maritime security and facilitating freedom of navigation and overflight over the region of the South China Sea.

The South China Sea route plays a significant role in maintaining India’s trade links with other nations. In order to trade with the countries situated in the southeast Asian region, India has to have a proper trade channel and in this case, the channel is the South China Sea. Therefore, India tries its best to not intervene in the internal disputes among the sovereign states.  

The South China Sea witnesses a very high rate of international trade passing through the Malacca Strait, which is a significant part of the South China Sea. The South China Sea constitutes one-third of the total global shipping. Over 55 percent of India’s trade passes through the South China Sea that includes the Malacca Strait. In case, a single country takes control over the whole of the South China Sea then it will be the dominating country having the sole authority over the waterway which could affect Indian trade drastically and might lead to major economic issues. To avoid similar situations, India holds a stake in ensuring the freedom of passage in the said area.

Even though India is not a party to the South China Sea conflict, it is forced to get involved in it due to reasons such as – strengthening relations with the ASEAN countries, safeguarding the Indian Ocean region against China, improving maritime security, and fulfilling its Act East Policy.

Resolution of the South China Sea conflict

In the present world, where trade is such an important aspect of the economy both globally and domestically for all the countries it is better for them to have amicable relations with each other. Continuing the South China Sea conflict would only result in economic issues and strained relations among the countries involved. So the parties to the conflict should take wise decisions to reach an understanding and resolve the conflict as soon as possible through diplomacy. It is normal that there will be some form of resistance shown by people towards the decisions taken by the governments of their respective nations but we should always consider the benefit of all over the greed of few. Hence, it is important to solve the disputes among the nations in a diplomatic yet effective manner.

Methods to resolve the South China Sea conflict 

The country claiming its rights over the South China Sea region must be ready to forgo the competitiveness of owning a part of the sea and rather draw an agreement by finding a middle ground in its claims which conflict with other countries.

All the nations involved in the conflict may, if not forgo, at least limit their claim over the South China Sea to an area of two-hundred nautical miles of the Special Economic Zone (SEZ) as mentioned in the United Nations Convention on the Law of the Sea (UNCLOS). This will result in equal hold of all the claimant nations over the South China Sea. Further, the international waterway would be open for free passage of trade. Alternatively, joint ownership can be established among the nations for those areas of the South China Sea that are subject to conflict. This would help in the equal distribution of wealth acquired among the claimant nations.  

Alternatively, a neutral nation that is indifferent to the gains/loss caused by the conflict must be given the responsibility to carefully study the claims of each nation claiming its rights over the South China Sea and produce a resolution that adheres to the principles of the United Nations Convention on the Law of the Sea (UNCLOS) or any other international law. A resolution through the means of bilateral negotiation was suggested by China, however, it has been rejected by other claimant countries based on the assumption that China being a huge nation will automatically be at an advantage over the others in claiming portions of the South China Sea.

Conclusion

The South China Sea is one of the most significant trade routes in the world. China claims its rights over the whole of the South China Sea based on historical records and the nine-dash line laid down by it in the past. While most of the other claimant nations claim their rights over the said Sea based on the concept of Exclusive Economic Zones. The countries involved in claiming their rights over the said Sea must solve the conflict among themselves as they are not only affecting the international trade but also the economy of the countries involved with them. India wants to stay away from the internal disputes of the sovereign states but it is compelled to get involved in it due to its trade link with the nations in the Southeast Asian region. However, the resolution to the conflict must be sought in such a way that it does not strain the relations between the claimant nations. 

References 


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Success of the ECJ in the creation of a unified market with the center on four freedoms

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This article is written by Ms Reet Balmiki, from NALSAR University of Law. This is an article which deals with the successful role of the European Court of Justice (ECJ) in the creation of a unified market.

Introduction

The Single European Market (SEM), or as commonly called the ‘unified market’ or the ‘single market’ has a complex socio-political, legal and economic history attached to it. As defined by the Treaty on the Functioning of European Union (TFEU) under Article 26, a single market is “an area without frontiers in which the free movement of goods, persons, services and capital is ensured”. The freedoms aforementioned are collectively known as the “Four Freedoms”. The market ensures seamless trade among the countries, allows for healthy competition among EU nations and other nations as well, and nurtures labour and technical growth.

The core idea of a common internal market can be traced back to the Treaty of Rome, 1958 which was signed by the then 6 member-nations of the European Economic Community. It was not until the mid-1980s that the idea of SEM was officially put into the making. The wide acceptance of the White Paper which was issued in 1985 ensured that the SEM was a near-reality. The Single European Act was finally brought into force in the year 1987 and the end of the year 1992 was set as a deadline for completing the creation of a unified market. Through the years, various technological developments, changing national policies and the emergence of new fields of law have decisively shaped the SEM, as we see it today.

Apart from the efforts of the European Commission, EU and the national legislatures to effectively harmonise the single market legislation, the European Court of Justice’s (ECJ) evolving jurisprudence has played a detrimental role in the creation and development of the European Unified Market. In this article, we will discuss the outstanding role of the ECJ in the Unified Market’s history through various case laws and jurisprudential developments alongside the four freedoms to effectively trace its success.

A brief understanding of the ECJ

The ECJ is the Supreme Court of the EU in matters of Union Law. It is often misunderstood as the Supreme Court of the nations and their governing laws. Instead, it is the Supreme Court for ‘Union laws’ only. Nevertheless, national courts refer cases to the ECJ regarding matters of and related to the Union law. From its official commencement in 1952, the ECJ has been the prime reason for the constant application of the EU laws. It contains one judge from each member-nation of the EU, which amounts to an entirety of 27 judges. The Court hears matters with three, five or fifteen judges depending upon the gravity and seriousness of the case at hand.

Figuratively, ECJ gives the flesh and blood to the existing treaties and guides the creation of new legislation and treaties that have to comply with the ECJ’s jurisprudence. Legislations, treaties and articles are of no use if they aren’t put to the best-intended interpretation consistently while allowing for departures due to any external developments. Recognizing and understanding the ECJ’s role becomes of paramount importance under this light. By adjudicating several conflicts of law and interpreting the law, the ECJ keeps the legislation alive and clarifies the position of a certain subject in the law.

Certain preliminary rulings from the ECJ and several other landmark cases on the integration of national economies and the creation of a unified market are sufficient enough to state that the ECJ has been the chief player in the development of the unified European market. It is a stressful exercise to understand the role of ECJ by studying its case laws independently. The previously mentioned four freedoms will help us to plot the cases in certain compartments and ease the process of analysis. Needless to say, we will now look at the four freedoms in light of the ECJ’s rulings.

Evolution of the four freedom

The ECJ’s rulings and the initial legislations have created the base for a unified market. These four freedoms stand as concrete pillars to the palace the unified market intends to build. The ECJ, by being the final arbiter, has drawn from legislation and its own decisions to develop a coherent jurisprudence. Each of the four freedoms ascribes to each essential idea for the unified market which will be explained with important judgments of the ECJ.

Free movement of goods

Though there is no explicit definition of what constitutes a ‘good’, the ECJ in a 1999 ruling, where the question was about fishing rights, has given the term a comprehensive interpretation.

Article 30 of the TFEU explicitly bans the imposition of customs and border duties for the movement of goods. Some early cases like the Commission v. Italy (1969) elaborate what ‘charge’ constitutes and lay down exceptions for imposing charges on goods respectively.

In the case of Commission v. Italy (Taxation of Rum), 1989, the ECJ has ruled that the rule prohibiting excess taxation of goods by the nation receiving them is “to ensure the free movement of goods between the member states under normal conditions of competition, by eliminating all forms of protection which might result from the application of discriminatory internal taxation against products from other member states, and to guarantee absolute neutrality of internal taxation as regards competition between domestic and imported products”. The excerpt from this case showcases the clear enunciation of an already existing principle to further clarify the legislative intent.

An interesting account of other quantitative measures and other kinds of measures having an equivalent effect can be found in the case of Dassonville, 1974. In this case, the seller files a case against a Belgian law that mandates the presence of a legal certificate issued by the concerned authority for scotch whisky imported from France. Interestingly, France doesn’t have a similar kind of mandate for certificates. When the issue was referred to the ECJ by the Belgian National Court, the Court held that it was contrary to the provisions of TFEU. The Court ruled extensively regarding the conflict of provisions in this regard.

Similarly, in the case of Rewe-Zentral (1978), the ECJ held a German law requiring all alcohols to have a minimum of 25 percent of alcoholic content. The Court, while sensibly observing the pervasiveness of technical barriers for the movement of goods and the indistinctly effective restriction, rejected the German’s arguments and held the law to be contrary to Article 36 of the TFEU. Beyond the subject matter, the case also establishes the principle of ‘mutual recognition’ of national rules. This is an essential pathway of the harmonisation of various national laws to achieve the goal of a unified market including various nations with their own laws and socio-political needs.

On the other hand, the ECJ has put its efforts to make room for special national needs and has allowed for certain exceptions. In the case of Commission v. Italy, 2003, the ECJ offers an interesting understanding of its developed jurisprudence. In this case, the law in question, though applying to goods of its nation and other nations, affected the other nations disproportionately. The Court recognized the disproportionate effect and ruled against it. In the Keck and Mithouard (1993) case, the Court has ruled that if a selling arrangement is applicable in law and in fact exists, it does not fall under the purview of Article 34 of the TFEU.

While associating itself in favour of a sensible idea of free movement of goods, the ECJ, as feared, didn’t exceed while ruling on a related case. The Court in the case of Schmidberger (2003) held the fundamental right of association over this freedom and considered it as enough justification. The balanced approach is evident furthermore here.

Even in cases of restrictions placed by a member state, the Court, if satisfied with the justification provided by the state, can uphold it to be valid. Commonly, justifications relating to public health, public security and general public policy are accepted.

Free movement of goods forms an essential part of an openly accessible market and has wide effects on large-scale economies and supply chains. This allows for a free choice of trade of goods. There also exists a conflict between the national interests and the goal of the European unified market. The ECJ has a proactive role in limiting the legislative conflict. This aspect shall be dealt with further in the analysis section.

The ECJ, from cases like Rewe-Zentral to the very recent 2003 case, has taken a consistent standpoint of view and has maintained a healthy jurisprudence in this regard with very few exceptions like Keck’s case.

Free movement of persons

One of the primary goals of European integration is the free movement of persons within the EU. The promotion of free movement and free right to reside in any EU nation if they are not an undue burden on the host nation has been a fundamental one since the 1950s. The basic idea being, the nationals that migrated or moved for whatever reason and to whatever nation within the EU, shouldn’t be discriminated against by the domestic individuals and should be treated equally to them with all the social benefits.

An interesting classification lies in the difference between ‘any citizen’ and ‘worker’. EU citizenship is an entirely different subject when compared to the free movement of the workers. The former includes certain nation-specific implications and a few exceptions. The latter emphasizes workers in the context of the market as a factor in production.

Apart from the idea of fundamental freedom in the primary treaties, there are several other legislations and treaties which govern the free movement of workers and their rights. The free movement of workers legislation is one such law.

The ECJ, again, has an impressive jurisprudence in this regard. This paragraph deals with the employment opportunities and rights of the workers. In the famous case of Angonese (2000), the Court held against the national law requiring a bilingual certificate for everyone applying for the job. The Court reasoned that, though the law mandates it for everyone applying, the said certificate can only be obtained in that nation, thus it affects other nationals disproportionately. An interesting observation in this regard would be to observe the similarity in reasoning in the current case and the Commission v. Italy, 2003 case. The jurisprudence states that the effects of a certain law must be looked at on a more subjective level. On the contrary, in the case of Groener v. Minister of Education (1989), the Court upheld the law applying to everyone as it did not have a disproportionate effect.

The issue of socio-economic benefits the workers can obtain offers a deeper understanding of the conflict of laws. In Hendrix v. Employee Insurance Committee (2005), where the person claimed that he was entitled to obtain incapacity benefits from the Netherlands even after he moved to Belgium. The Court observed the absence of any ‘unfairness’ and held that the benefit is closely related to the socio-economic situation of the Netherlands and thus held the claim to be invalid.

The Court further opined that, in the absence of any justification that can be understood from the facts, any such law denying benefits would be contrary to the EU law. The court, while upholding the freedom of movement, has approved certain residential qualifying periods of the nations. A similar issue of obtaining social assistance and advantage exists for non-workers residing in other nations within the EU too. In Dano v. Jobcentre Leipzig (2014), the court upheld the right of the German government to deny child benefits to a woman residing in Germany.

The Court of Justice while prioritizing freedom, has kept itself accordant with the exceptions of “public health, public security or public policy” and “employment in public services” under Articles 45(3) and 45(4) of the TFEU respectively.

The Schengen Area and the EFTA nations’ treaty further extend free travel for everyone without border checks and stringent immigration policies.

To sum up, the ECJ has ensured that a community of over 500 million belonging to different historic and social backgrounds get the socio-economic benefits undeterred by the nation they choose to reside or work in. Though there exist concerns of the migrant crisis and management concerns of nations, the EU laws and the ECJ have been successful so far in creating a community rather than just a market.

Free movement of services

With a fair understanding of the ECJ’s jurisprudence and the law regarding the previous 2 freedoms, we will now delve into the freedom of movement of services. Services, according to the Court of Justice, include “temporary services” and “establishments”. For a free movement of goods, establishment and movement of services becomes the detrimental factor. With great importance, this freedom remains one of the most conflicting freedoms of all. National policies and regulatory standards often hinder this freedom. Thus, a closer look at the ECJ’s rulings and the evolution of law in this regard becomes necessary.

The landmark Reyners case forms the origin for jurisprudence in this regard. The 1974 case held the decision of the bar council to not admit a Dutch national on grounds of not having Belgium’s nationality as unjustified and invalid. This case, alongside being one of the earliest cases, also clears the fog regarding the public service and private service distinction.

The restriction in the above case is a prima facie denial of free movement of service. But the jurisprudence is not limited to only primary restrictions imposed. The ECJ expanded the law in this regard in the Sager 1991 case. The Court ruled that prohibition of restrictions also extends to restrictions that are “liable to prohibit or otherwise impede the activities of a provider of services established in another member state where he lawfully provides his services”. The ECJ, similar to the line of reasoning adopted in cases of free movement of goods, has consistently held that remote restrictions without any justifications are also invalid.

The gravity and complexity of this freedom increase more so in the context of establishments. Unlike services, establishments, as ruled by the Court of Justice, are entities that participate “on a stable and continuous basis”. However, freedom of establishment only extends to allowing the incoming establishment. The functioning of its services and businesses can be subject to regulatory laws and directives.

The case of Cassis de Dijon is relevant in this context too. The case of Gebhard v Consiglio dell’Ordine degli Avvocati e Procuratori di Milano (1995) consolidates the jurisprudence in this regard. The Court held the suspension of a German lawyer by the Italian authorities on grounds of not having Italian registration to be invalid. The Court went on to state that though the measures were not entirely restrictive they were contrary to the provisions as they were “liable to hamper or to render less attractive the exercise by Union nationals…of the exercise of fundamental freedoms guaranteed by the treaty”. This “wide approach” has its roots in the Cassis de Dijon case. A similar case is the Vlassopolou, 1991 case, where the Court held that “Member States may not ignore the knowledge and qualifications already acquired by the person concerned in another Member State”. We can see a clear convergence of the free movement of persons, services, and establishments from the above cases. Thus, the canon of law produced by the ECJ is clear though they are interlinked.

The movement of business also carries movement of tax regulations and service regulations with it. National legislation in this matter is not harmonized to the effect that other freedoms are harmonized. Different tax requirements and multi-layered national interests come in the way of full integration of the market, especially under this freedom. The court has taken a pragmatic approach in deciding cases between the right to establish companies freely and member states’ right to determine regulations for companies regulated in its territory. The distinction can be understood from two landmark cases.

In the R v. HM Treasury 1988 case, the court held that the company could not shift its base from the UK to the Netherlands without settling its tax accounts in the UK. Though the question was about freedom of establishment, the ECJ has prioritized national legislation over Union freedoms. On the other hand, in the controversial Centros case, the court held the law to be contrary to the Union law’s provisions. The limited company based in the UK was entitled to shift its servicing establishment to Denmark. The conflict arose due to the differential capital requirements for an establishment. The ECJ, with a broad approach, yet again upheld the freedom and refused Denmark’s arguments. Still, the debate around shifting ‘real seat’ and ‘legal seat continues. It is an economic and political debate rather than a law one. The implications and aftereffects bring the law in its entirety to question. The ECJ, by upholding the freedom for establishments and services as an essential one to the unified market, has put out an evaluated jurisprudence.

Freedom of capital

The last among the four freedoms is the freedom of capital. This freedom is supplemented and supported by numerous directives, treaties, and other agencies with this duty. An exhaustive definition or list of what exactly constitutes capital cannot be stated easily. From direct investments, shares and dividends to gifts and sureties, the list has a lot to speak for itself.

European currency and its capital flows have a peculiar history. As of today, euros can be transferred within the EU nations in any amount. They bear no costs except for domestic transfer and exchange costs. The goals and objectives of creating a unified capital flow system are manifold. Implications and reasons extend to crude monetary policy discussions.

The scope of this discussion is limited to the ECJ’s influence and its case laws. Though we might have to understand the subject matter while going through the facts of the case. This section tries to discuss within the aforementioned limit whilst discussing the jurisprudence’s development.

In the recent 2002 case of Commission v. France (2002), it was held by the ECJ that “all restrictions on the movement of capital between the Member States and between the Member States and third countries are prohibited” and “general prohibition on restrictions on the movement of capital between the Member States. That prohibition goes beyond the mere elimination of unequal treatment, on grounds of nationality”.

A wide approach is taken by the courts while deciding cases upon this issue. Like restrictions on other freedoms, freedom of capital also doesn’t necessitate a direct restriction. There have been cases in the ECJ which were held to be contrary to the EU laws though the restrictions had a remote implication.

In the case of Finanzamt Köln-Altstadt v. Schumacker (1995), it was held that “the rules regarding equal treatment forbid not only overt discrimination by reason of nationality but also all covert forms of discrimination which, by the application of other criteria of differentiation, lead in fact to the same result”.

The movement of capital has effects on entire economies and monetary policies. The freedom also extends to certain kinds of limits about shareholding rights, debentures, and securities. In a unified market where capital must flow freely, functioning of this freedom without any hindrance becomes the key. A comprehensive ruling in this matter is the case of  Commission v. Portugal (2010). In the 2010 case, Portugal retained golden shares in Portugal telecom. Though this doesn’t have a direct impact, the Court struck down stating that this created “disproportionate rights” and reduced the “attractiveness of an investment.”

Similar cases in this arena are the same. Though the case laws are clear on certain aspects of capital flow, cross-border mergers, and acquisitions of establishments in this unified market, remains a concern. In a number of other cases, the ECJ’s consistent stand reflects its natural approach to favour the sustenance of a real unified market.

Article 114 of TFEU

So far, we have discussed the cases which were based on legislations and directives’ articles. Before we go into the final analysis of the ECJ’s jurisprudence a brief introduction to this provision would be helpful. Article 114 of TFEU is one such provision that demands special attention. It confers the EU with the competence to make any other legislation in furtherance of SEM. Initially, when it was inserted in 1986, there were apprehensions by the member states that this could possibly provide a gateway for the Union to override any national policy.

Thus, the ECJ once again had to clarify the interpretation of this provision. In the European Parliament v. Council of the European Union (2006) case it was held that “it can only be used for the ‘approximation’ of laws and administrative practices and not for other purposes related to the SEM”.

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Analysis of the ECJ’s success

A unified market essentially means the liberalization of movement and having unified institutions that ensure the market’s survival and growth. To have supranational institutions like the European Council and the ECJ which can go to the extent of influencing nations themselves is neither a linear process nor a simple existence.

Throughout history, from being the birthplace of a new world through science and philosophy, European nations have come a long way. A vision to have equal competition and thus equal growth took years in the making itself. Achieving a ‘complete’ unity among nations with different histories and political concerns sounds realistically impossible. Perhaps, the very idea of a unified market on this scale was once ridiculed.

It goes without saying that the ECJ has an essential part in the creation of this market. Beginning from the Dijon case where the court put out the idea of “mutual recognition” of legislation among each other, to the very recent Commission vs Italy, 2003 case, the ECJ has been in the process of constant evolution and reaffirmation.

Having a law at the Union and various laws within the nations brings in an inevitable conflict. Therefore, the ECJ was the player to settle these conflicts of legislation and interests. Across the cases discussed in the four freedoms, we can clearly observe a conflict between the union laws and the member state’s interests. The ECJ, thus, must do a ‘balancing act’ between both. The court, though reasoning in favour of the unified market throughout the years, has never represented itself directly or indirectly as an agent to the unified market.

The ECJ’s jurisprudence in its majestic equality and reasonable accommodations has limited the tension between nations, unions, and private entities to the extent it could. Today, there is a catena of cases available for every freedom and all aspects of the Unified market. A close study of cases specific to a topic reveals more about the deepened legal basis for the unified market.

A unified market system sustains only in the presence of a uniform law. The ECJ is a doubtless success in that regard. The values the ECJ holds is evident from the words of the President of the ECJ, Koen Lenearts– “…beyond a core nucleus of shared values where the ECJ must ensure uniformity, EU law cannot disregard the cultural, historical and social heritage that is part and parcel of national constitutional traditions. Beyond that core nucleus, the ECJ welcomes ‘value diversity’”.

Conclusion

After years of evolution of complete jurisprudence, a number of directives and treaties, and various developments around the world, a completely unified market is still in the making. The ECJ, like always, has a duty to keep up with further developments and changes to foster the development of the unified market. The ECJ’s success is visible in the reasoning of various judges. For what it has done to create a unified market, the ECJ jurisprudence’s success will remain a legacy.

References


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