Startups want separate policy for data storage than for e-commerce, write to Piyush Goyal with these demands

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Published: June 19, 2019 5:12:24 PM

The draft e-commerce policy launched in February this year by the DPIIT had said that businesses collecting or processing data in India and storing it abroad shall not be shared with other businesses or third parties outside India or foreign government.

Commerce Minister Piyush Goyal on Monday had asked e-commerce companies to submit their concerns related to the draft e-commerce policy within 10 days.

Online community platform LocalCircles, which has more than 30,000 startups and SMEs engaged on its platform, in a letter to the Commerce and Industry Minister Piyush Goyal on Tuesday, has asked for a separate ‘business data’ policy from the e-commerce policy for regulating aggregate data held by businesses across sectors in India including e-commerce, social media, physical retail, banks, telecom, airlines, automobile, healthcare, etc.

“We have asked to divide the e-commerce policy, which should solely be for issues pertaining to fake products, FDI, sellers’ issues, cross-border issues etc., from a separate data policy of how businesses should handle their aggerate data, where it has to be stored etc. If the government has to clear its stand on data and e-commerce to World Trade Organization then the policy can be called as India’s E-commerce, Trade and Data policy,” LocalCircles chairman Sachin Taparia told Financial Express Online based on inputs received by around 15,000 startups on the platform.

Further, the letter also emphasized on letting businesses share aggregate data with their group companies outside India and also third parties preferably.

On the government part, it said that the government should have the right to seek such data, source code, and algorithm from businesses only in cases of law and order, investigation and enforcement.

“Government should not be asking for aggregate data without proper basis like issues around law and order, investigation and enforcement because particularly for technology businesses aggregate data, source code and algorithms are their only assets and intellectual property,” said Taparia.

Importantly, the letter also asked for setting up a startup social responsibility programme similar to corporate social responsibility that may ask for sharing of predefined data sets by large businesses for their respective sectors to help startups in that sector boom.

“Since no company would like to sign up to open-ended sharing of its aggregate data with other businesses, we have proposed a startup social responsibility programme for large businesses towards the startup ecosystem in their sector,” added Taparia.

For instance, if a hospital chain has an enquiry for 1 lakh knee replacements across India and there is a startup that offers low-cost knee replacement product then startups can benefit by knowing about such aggregate information. “One way to implement this could be for large companies to declare what they are doing under such a program in their ROC filings,” he added.

The draft e-commerce policy launched in February this year by the DPIIT had said that businesses collecting or processing data in India and storing it abroad shall not be shared with other businesses or third parties outside India or foreign government, for any purpose, even with the customer consent. Also, it asked for permission from Indian authorities to access such data stored in outside India.

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