The Telecom Regulatory Authority of India launched a new salvo this past week into the ongoing debate on the shape of the country’s first data protection law, with the release of their recommendations on data privacy in the telecom sector. While TRAI makes many recommendations that strengthen user rights, they also propose to extend the telecom regulatory framework to “all entities in the digital ecosystem”, a change that would result in significant harm for users and the internet ecosystem. TRAI argues that until India has a comprehensive data protection law, the licence conditions that apply to telecom companies must apply to “telecom service providers, devices, operating systems, browsers, applications etc”. We respectfully disagree with TRAIs claim that this framework is “fairly robust” in protecting user privacy. The license terms are not only an awkward fit in the context of non-telecom companies, but several conditions, like those relating to data localization, encryption, and law enforcement access, are themselves in need of urgent reform.

TRAI’s recommendations are just one of the many attempts by Indian regulators to fill the void left by the repeated delays in the release of the Justice Srikrishna Committee bill — the Committee established nearly a year ago by the Indian Ministry of Electronics and Information Technology to write the country’s first data protection law. Other regulators getting into the fight include the Reserve Bank of India (RBI), which made the controversial announcement requiring all financial data to be localized in India, and the Health Ministry, which has proposed its own health data privacy bill. Sectoral regulation can have many benefits under certain circumstances. But as regulators grow impatient with the delays in developing a comprehensive data protection framework, India risks splintering into problematic sectoral regulation that both expands these regulators’ mandates and provides insufficient protections for users.

So what does TRAI actually say?

Applying telecom license conditions to the entire “digital ecosystem”: Making a bad problem worse

TRAI Recommendation 3.1.b reads

“Till such time a general data protection law is notified by the Government, the existing Rules/ License conditions applicable to TSPs for protection of users’ privacy be made applicable to all the entities in the digital ecosystem”

•  The license conditions referred to by TRAI include the “Unified License” (or UL) binding on all telecom service providers in India. Several of these terms are long overdue for reform, and in particular, we worry about the following:

• Access for security agencies: (UL Condition 39.12): This license condition requires that entities, “in the interests of security”, set up “suitable monitoring equipment” as per the requirements of security agencies – “as and when” they may require them. This broadly worded obligation requires re-examination, particularly whether it fulfils the proportionality standard laid down by the Supreme Court of India in Puttaswamy v Union of India case.
• Data localization (UL Condition 39.23.viii and 39.23.iii): These conditions prohibit the transfer of accounting or user information to servers outside India; and allow the government to mandate that traffic related to certain entities is localized “for security reasons”. As we’ve argued, a broad data localization mandate, particularly for the fast-growing Indian digital economy, would be bad for users, business, and security.
• Prohibition of bulk encryption (UL Condition 37.1): At Mozilla, we believe encryption is critical to the health of the Web. The current license terms bluntly restrict any “bulk encryption”. While TRAI does acknowledge that encryption is critical to a safe and secure web, and recommends strengthening encryption standards in Indian policy, a clear recommendation for the repeal of this regressive condition is in order.

Steps in the right direction: user rights, meaningful choice, breach notifications

• Somewhat at odds with their endorsement of the telecom license terms, TRAI also recommends several key data protection rights, including the right to meaningful consent, notice, and data portability. On the topic of consent and choice, TRAI provides helpful nuance for its application to the telecom and internet ecosystem. In particular:

• Ability to delete pre-installed apps: We commend TRAI’s recommendation that it should be “mandatory for devices to incorporate provisions so that users can delete pre-installed applications, which are not part of the basic functionality of the service”. As we recently argued in the context of the French regulators’ suggestions on ‘device neutrality’, “applications should generally have the opportunity to become full replacements of default applications.”  
• Mechanisms for vulnerability disclosure: We welcome TRAI’s recommendation for transparent vulnerability disclosure in the telecom sector. Accountability structures that incentivise disclosure are key to the security of the digital ecosystem. However, we emphasize that governments themselves must be part of and subject to such frameworks. Mozilla has argued for strong government vulnerability disclosure frameworks in the US and more recently, in Europe.

Finally, TRAI also recommends the “Electronic Consent Framework” developed by the Ministry of Electronics & IT as a model technical solution to digitise the giving and revocation of consent as well as data transfers between entities. While the goal of empowering users is a noble one, before jumping to technical solutions, fundamental protections for users must be enshrined in law.

As Mozilla has long argued, India requires a comprehensive privacy and data protection law, grounded in individual rights and following the high standard set by the Puttaswamy judgment. Patchwork sectoral laws in the absence of a comprehensive data protection law are too weak a foundation for the protection of the fundamental right to privacy.

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https://blog.mozilla.org/netpolicy/2018/07/26/indian-telecom-regulator-data-protection/