India´s new Data Privacy Rules

Will They Help or Hurt Legal Outsourcing?

As the Washington Post has just reported, "data privacy rules enacted last month in India are now alarming some U.S. companies, which worry that they may be too restrictive":

The rules in India’s Information Technology Act govern the collection and use of personal information including banking and medical details. But business leaders in India and the United States worry that they add a cumbersome layer of disclosures such as obtaining written consent from each customer before collecting and using personal data...read more...

Outsourcing to China

In his recent paper on "Outsourcing to China: Risk Management and Strategies", published in The Licensing Journal (November/ December 2009), Harry Rubin provides some very interesting and detailed insights on legal issues in outsourcing in the case of China.

Everyone interested in this specific region should definitely take a look at his article! Feel free to leave your comments below!

Questions raised on Legal Issues in Outsourcing

In one of their research papers, Ramanujan and Sandhya (2006, p. 54f) have raised some interesting legal questions on the issues of outsourcing, which could be helpful considerations especially for U.S. managers:

1. “Will the transaction involve any attempted imposition by the U.S. government of extraterritorial jurisdiction? If so, is there likely be a conflict of laws, and what treaties or other legal mechanisms exist to overcome any such conflict?”
2. “How can the operations be made most tax-efficient?”
3. “What will be the impact of U.S. rules on the export of any information technology, process technology or other trade secrets?"
4. “If the foreign personnel need to be deployed rapidly in the United States, under what conditions will the Immigration and Naturalization Service cooperate in allowing them to visit for the necessary time period?"

Has anyone got any answers to this? Well, some hints to these questions might be provided in the course of our blog. However, feel free to comment on this and share your information.

Overview of Indian Law System

This chapter wants to give a brief overview of India´s law system, the sources of its legislation and how law is interpreted.

One basic principle of Indian law is that jurisdiction is independent. This is one important part of the written Indian constitution that also declares India as a socialist, secular and democratic republic with a nearly federal structure. (Vagadia 2007, p. 33).

The systems of law can be divided into two main parts: On the one hand civil law and on the other hand criminal law. It is also divided into Higher or Union Judiciary consisting of the Supreme Court and into Subordinated Courts or State Judiciary. Additionally, for special purposes special courts and Tribunals can be formed. (Vagadia 2007, p. 33). These Tribunals are empowered to decide disputes between two parties and have to follow the legal procedures and aim to assist the judiciary as well as to avoid slow and expensive formalities. (Vagadia 2007, p. 35).

The primary source of new laws is the Indian government. The president and local state Governors have only limited powers to issue ordinances as long as the parliament is not in session. (Vagadia 2007, p. 34).

Another, secondary source of law are judgments of the Supreme Court and of specialized Tribunals. They do not only decide legal facts in case of a dispute between two parties but also declare and especially interpret existing law. (Vagadia 2007, p. 34).

The Constitution itself rules that law that is declared by the Supreme Court is binding for all courts within India but also says that the Supreme court itself is not bound on its own decisions. (Vagadia 2007, p. 34).

Another important role in Indian law play local customs that, as unwritten law, express doctrines of justice in the society. Examples for these customs are Hindu Law or Muslim Law. (Vagadia 2007, p. 35).

As the General Rules in Indian Law are based on English principles, Indian courts also frequently use the help of English decisions. (Vagadia 2007, p. 36).