The Ministry of Electronics and Information Technology has issued an advisory (hereinafter referred to as the Advisory) "Due diligence by the intermediaries under the Information Technology Act, 2000 and the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (hereinafter referred to as "IT Rules, 2021") to all the social media intermediaries. The Advisory was issued in continuation of previous advisories dated March 15, 2024 and December 26, 2023.
The Advisory stated that Intermediaries while complying under their due diligence obligations under the IT Rules, 2021 are not taking prompt action in some cases by removing the prohibited content from their platforms, which could lead to irreparable loss and/or harm to the individuals in instances like cyber financial frauds and scams.
The Advisory came as a response to the Bombay High Court's order in the matter of National Stock Exchange of India Limited v. Meta Platforms, Inc. & Ors.1 wherein the court, while emphasizing the duty of the intermediaries under the IT Rules 2021 to take prompt action on the complaints of entities like National Stock Exchange of India but unauthorized use of their trademark on dubious webpages, profiles, accounts, content, social media groups and/or channels, directed the concerned intermediaries to delete or disable the fake information such as morphed videos and profiles circulating on their platform relating to the plaintiff promptly within ten hours of receiving such complaints.
The advisory directed the intermediaries to take prompt action to remove any prohibited information at the earliest possible opportunity in observance of their due diligence obligations under the Information Technology Act, 2000 (hereinafter referred to as "IT Act") and the IT Rules 2021 towards keeping the internet in India open, safe, trusted and accountable.
What led to the Advisory being issued?
An interim application was filed by the National Stock Exchange (hereinafter referred to as the "Plaintiff") on the ground of urgency in the matter stated hereinabove against the defendants, one of which was Meta Platforms, Inc. citing that social media intermediaries have featured a fabricated video of the Managing Director and Chief Executive Officer of the Plaintiff which was generated using sophisticated AI technology to imitate his voice and facial expressions.
Contentions of the Plaintiff
- The Intermediary features an AI generated fake video of its Managing Director endorsing public to join a WhatsApp communication community in the name of the Plaintiff thereby misleading investors;
- The plaint was also filed against unknown perpetrators who infringed the Plaintiff's trademark by wrongful circulation and/or publication of false and misleading advertisements on social media platforms owned by Meta.
- The Plaintiff further argued that the intermediary procedures for addressing flagged content are extremely time consuming and impracticable. During this period, the deepfake videos continues to be in circulation leading to likelihood of grave and irreparable injury to the investors, who may act on the false information and lose their hard earned money.
- The Plaintiff contended that the time taken by the intermediaries is of utmost importance as information in relation to the markets is extremely sensitive and investors are likely to act upon it. It further submitted that in some cases the time lag of approx. 15 days is there between when a fake advertisement is reported till the time it is actually taken down by the intermediary and in certain few cases, it even takes upto 17 days.
- The fake videos also infringed the intellectual property rights of the Plaintiff by using the Plaintiff's logo and the likeness of its CEO's face and voice.
Relief prayed for
Citing Rule 3(1) (b) and Rule 3(2) of the IT Rules, 2021 as well as the previous deepfake advisories of the Meity, the Plaintiff sought for taking down and removal of the unauthorized videos. Along with that, the Plaintiff has sought for directions to take down and remove Plaintiff's marks on their social media platforms.
NSE being a first level market regulated delegated with the Securities and Exchange Board of India serves as a crucial platform for investors to trade securities with approximately 2500 listed companies on the platform and market capitalization of listed companies to $5 million. Thus, noting the outreach of the Plaintiff any activities involving publication of fake and misleading advertisement would have a great impact on the investors which can also result in financial loss to them. Such misleading and fake advertisements also endanger the reputation and goodwill of the Plaintiff.
On noticing the videos, the Plaintiff had issued a Press Release dated June 10, 2024, cautioning the investors regarding the circulation of the Fake Videos of the MD and CEO of the Plaintiff recommending stocks.
Court's directions
The Court, taking note of all the submissions made by the Plaintiff and observed that the acts complained of have severe consequences to the fair efficient and equitable securities market ecosystem endeavored to be maintained by the Plaintiff. The Court also noted that the intermediaries shall remove or disable access to that information as early as possible but not later than 36 hours from the receipt of the Court pf from an appropriate notifying authority. Thus mandating the intermediaries to take prompt action on such complaints received from entities such as Plaintiff.
Existing law on dissemination of false, misleading information and AI generated deepfake images and videos
Rule 3(1) (b) of the IT Rules, 2021 eleven types of prohibited content which further makes intermediaries responsible to make reasonable efforts to not to host, display upload, modify publish, transmit store, update or share any information. Non-compliance with the said provision would attract Rule 72 of the IT Rules and would render organisations to losing protection under the Section 79 (1)3 of the IT Act, 2000. 5
Rule 3(1)(b)(v) further strictly prohibits dissemination of misinformation. The former Union Minister of State for Skill Development & Entrepreneurship, Electronics and Information Technology, Shri Rajeev Chandrashekhar, in the advisory dated December 26, 2023, had emphasised that the platforms have been duly informed about the legal consequences associated with any violations of the IT Rules. 5
To read more:
https://ssrana.in/articles/meitys-advisory-unveiled-to-tackle-deepfake-menace/
https://ssrana.in/articles/meity-approval-companies-ai-generative-models/
https://ssrana.in/articles/techethics-deepfakes-morality-and-values/
Footnotes
1. Interim Application (L) No. 21456 of 2024in COMPIPR SUIT (L) No. 21111 of 2024
2. Rule 7 of the IT Rules, 2021- Non-observance of Rules can lead to penal consequence
3. Section 79 (1) of the Information Technology Act, 2000 provides safe harbor to the intermediaries with an exemption from liability in case of third party information data or communication link made available or hosted by him.
4. https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1975445
5. https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1990542
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
