Reliance Jio-Facebook Deal Under Scanner By Architect Of India’s Data Privacy Laws; Red Flag Raised

Last month, Facebook, the world’s social network giant, bought 9.99% stake in Reliance Jio, India’s biggest telecom network with an early focus on leveraging the latter’s e-commerce platform JioMart. . 

Chief architect of India’s data privacy law Justice BN Srikrishna has raised concerns over the lack of a data regulator to oversee privacy issues stemming from the Reliance Jio-Facebook deal. 

Read to find out more… 

What is the Fuss About?

Justice BN Srikrishna says such a data deal happened ‘precisely because there is no law’. Srikrishna while raising a red flag over the long-term strategy of the deal, says, “It is a strategic investment. A strategic investment by definition means it is an investment intended to further the business interest of the investee as well as the investor.”

Justice Srikrishna also pointed out that the Reliance Jio-Facebook deal raises two important issues:

1. Competition law
2.  Data.  

He highlighted that existence of Competition Law in India ensures that a regulator is in place who, upon a complaint being made will investigate facts, will look into various aspects of the deal following due process of law and finally come out with a conclusion.  However, with data, he says, “Without the Personal Data Protection (PDP) Act coming into force, where is the regulator?”

While speaking at a webinar hosted by Daksha fellowship on Data Governance and Democratic Ethos he said, “Data regulation becomes a big issue there, because of the absence of regulator. And the regulator is not there because there is no law in place.” 

In accordance with Justice Srikrishna’s point of view, Rahul Matthan, Partner, Trilegal says that though privacy concerns around the deal have still not been flagged, this is perhaps one of the reasons why the country desperately needs privacy laws. Mathan while emphasizing on the need for supervision around data deals, says, “These deals will happen and without a regulator, we are relying on the two respective companies being good citizens and not violating the terms of their own privacy policy”.

Issues In the Reliance Jio’s Privacy Policy?

The privacy concerns being raised also arises from the current policy standpoint of Reliance Jio. Although Jio’s website the privacy policy states ‘We do not sell or rent personal information to any third party entities’, it also states certain exceptions. The policy says it limits the disclosure of personal information such as name, phone number, address, photographs and proof of identity documents such as PAN Card, Passport etc., in certain circumstances which includes scenarios such as mergers or acquisitions that affect the company and also to its partners. 

According to the policy, exceptions to sharing with ‘Partners’ include vendors, consultants, contractors and companies or affiliates who provide a host of services including contact information verification, payment processing, customer service, website hosting, data analysis, infrastructure provision, IT services, and other similar services.

The Reliance Jio-Facebook deal places Facebook in the category of a ‘Partner’. 

In an interview to Business Today, Ajit Mohan, VP and Managing Director, Facebook India had said that the company continues to have an independent view (from Reliance) on a number of topics and data localisation is one of them. He had said, “But we also believe that unrestricted free flow of data is the bedrock of an open market, which has greatly contributed to India’s technology boom so far. We hope the future data protection regime protects consumers and also boosts the ease of doing business in India.”