Ananya Jain, 5th Year BBALLB Student at CHRIST (Deemed to be University), Delhi NCR.
“Cyber-bullying is poised to turn into the biggest online concern, already affecting up to 35% of all children.” – Dr. Martyn Wild
Introduction
Have you ever experienced opening a box of crayons and the smell takes you down the memory lane and creates a wave of nostalgia around you? This has been the inspiration behind protecting the smell of the Crayola Crayons. The idea behind the registration of this non-sensory trademark has been the powerful connection between childhood and Crayola Crayons.
Recently, the art and crafts giant, Crayola, ranking Number 1 in the sales category of the United States has recently got the smell of the Crayola Crayons trademarked by the US Trademark and Patent Office. The Chief Executive Office, Pete Ruggerio wanted to bring the nostalgia back to people when they would surf through the aisles of a store and move past boxes of crayons. The smell has been described as a “scent reminiscent of a slightly earthy soap with pungent, leather-like clay undertones”, which would certainly make an individual walk around the memories of their childhood.
In 2018, Hasbro, Inc., had also trademarked the smell of Play-Doh. The smell was described as “sweet, slightly musky, vanilla fragrance, with slight overtones of cherry, combined with the smell of a salted, wheat-based dough”. This smell is also known to be associated with the childhood of people and bring about the memories of childhood among them.
The Commercial Importance of Smell/Scent Protection In India
Apart from instilling a feeling of nostalgia among people, trademarking a smell can be a powerful tool to build brand loyalty, identity and value for a company, as scents/smells have a unique ability to evoke strong emotions and memories in individuals.
In the Indian Context, protecting a smell can be important for a brand as there are diverse fragrances that have been an integral part of our daily life as well as our heritage and culture. One familiar scent can take an individual back to their childhood and make them reminiscent of various fond memories. The smell of Vicks VapoRub, is instilled in the Indian Households and is associated with the feeling of comfort and being cared for when we were children. Vicks has become associated with relief and care because of its distinctive smell and protecting this smell can protect the brand and ensure its unique position in the market. The following are the objectives behind seeking protection of a smell trademark:
Building Brand Loyalty: Fostering brand loyalty is the primary objective behind protecting a distinct smell associated with a product. Taking an example of Mysore Sandal Soap, its iconic and distinct fragrance of woody aroma of sandalwood evokes fond memories of family traditions and rituals as it is deeply rooted in Indian Culture. By protecting this unique scent, the customers are ensured of their association with the brand and those cherished memories, which fosters brand loyalty.
Expansion beyond Target Markets:Protection of a particular scent appeals to the primary target market of a product as well as to other demographic areas. The scent of Himalaya Neem products is instantly recognizable to many Indians. By protecting this scent, the company can not only appeal to its primary market of skin care, but can also expand into ayurvedic products, capitalizing on the positive association that people have with the distinctive smell of the product.
Influencing Purchasing Decisions: A distinct smell of a product can help incline the purchasing decisions of a customer towards a particular product. Take the example of Dabur’s Chyawanprash, which fosters a strong connection with its consumers through its distinct smell of herbs, spices and honey. Customers instantly associate it with health and wellness and protecting this scent, ensures that no other product can replace this sensory experience, making the product a go-to product of the customers.
Influencing Purchasing Decisions: A distinct smell of a product can help incline the purchasing decisions of a customer towards a particular product. Take the example of Dabur’s Chyawanprash, which fosters a strong connection with its consumers through its distinct smell of herbs, spices and honey. Customers instantly associate it with health and wellness and protecting this scent, ensures that no other product can replace this sensory experience, making the product a go-to product of the customers.
Challenges of Obtaining Smell/Scent Trademarks
The criteria for protecting a scent/smell and obtaining a trademark for the same is not as simple and is faced with the following challenges.
Distinctiveness and Novelty: The smell has to be distinctive to identify the source of a product or a service but shall not serve a functional purpose or merely describe the product. It shall be identifiable with the product and shall not be associated with other products of similar type.
Graphical Representation It is one of the biggest challenges in obtaining a trademark of a scent. A scent has to be depicted and described accurately in a manner that avoids confusion with other products in the same category.
Non functionality: A scent, being a natural characteristic and a standard feature of a product cannot be trademarked. The scent shall not be a function of the product. In the case of Crayola Crayons, its smell carries a distinct and novel smell of slightly earthy soap with pungent, leather-like clay undertones. The smell is non-functional as the function of the product is colouring. Further, the description of the smell is accurate and is not confused with the smell of other crayons. The biggest challenge posed in India for registration of olfactory marks is the graphical representation as it is very difficult to describe the smell of a product accurately, while not creating confusion among other products, in the same category of products.
Ayushi Sharma, 4th year BComLLB student at Institute of Law, Nirma University, Ahmedabad.
The Wireless Telecommunication Industry in India is among the biggest and fastest-growing in the world, and it is essential to the nation's digital revolution. It is distinguished by a high rate of penetration and a competitive environment where big firms like Vodafone Idea, Bharti Airtel, and Reliance Jio compete with dynamic strategies. Data consumption and internet penetration in India skyrocketed with the launch of 4G networks in the mid-2010s, driven by Reliance Jio's innovative pricing. In addition to supporting programs like Digital India, which seek to empower citizens through digital connectivity, the sector now makes a substantial contribution to India's GDP.
Globalisation has had a significant impact on businesses, as businesses underwent a drastic change. A collaborative strategy between the enterprises has aided in reaching corporate organizations on a global scale. Collaboration with other corporate organizations is accomplished through a variety of business tactics. Merger and acquisition (M&A) strategies are one of those strategies. Developing countries always have an excellent scope to introduce new firms. As a result, numerous small business organizations benefit from increased exposure. However, when large players adopt aggressive methods, these small firms suffer and are unable to compete with the large player. In that circumstance, small firms must take critical decisions in order to thrive in the market. At that time, mergers and acquisitions are being used. We are investigating the popular mergers and acquisitions that have occurred in India since its foundation and mergers and acquisitions in India's wireless telecommunications sector impacting customers and market position.
Defining mergers and acquisitions: M&A is an important aspect of any organization's strategic planning. It entails the merger of two companies with the goal of growing market share and increase earnings as well as making a significant contribution to the sector. The technical term "mergers and acquisitions" refers to the combination of two or more businesses. A merger occurs when two businesses come together to form a single entity, but an acquisition occurs when one business buys another, meaning that no new business is created rather one business is absorbed into another. This kind of reorganization is done to boost profitability and achieve quick growth.
Mergers and acquisitions in India are governed by the Competition Act 2002, which is the main legislation. Sections 5 of the Act addresses merger and acquisition regulation while section 6 provides for regulations for the same which are necessarily see the impact of such merger and acquisition within the Indian market. The aim is to ensure zero adverse effect on competition in India.
Popular Mergers and Acquisitions:Merger of Vodafone India & Idea Cellular (2018) Vodafone India established in the year 1994 to conduct business in India by its UK-based parent company Vodafone Group plc. In light of the increasing disruption in the telecom industry, the company sought to develop growth strategy after encountering intense competition from other telecom providers such as Bharti Airtel and Reliance Jio. The Idea cellular on the other hand faced tough pricing war by Jio which had driven the company into losses, with a 59% drop in its comprehensive consolidated income. This lead to the merger of Vodafone and Idea on August 31, 2018 which became the biggest merger in the history of Indian wireless Telecommunication Network. Given that this was a merger of equals, the agreement's swap ratio was 1:1, meaning that each Idea Cellular Limited share would be worth one share in the combined business. Vodafone India gave the Aditya Birla Group its 4.9% holding in exchange for a cash payment of about INR 39 billion, in keeping with the two promoter companies' goal of equal ownership. This merger opened the door for the establishment of what may be the biggest service provider in the Indian telecom industry, with a combined user base of over 400 million customers and a combined market share of 35%.
Merger of Bharti Airtel & Indus Towers (2020) Indus Towers, a joint venture of Bharti Infratel, Vodafone Idea, and UK-based Vodafone Group PIc, merged with Bharti Infrarel Limited on November 19, 2020, to become the world's largest telecom tower firm. Following the merger, Vodafone Group owns 28.12% and Bharti Airtel owns 36.73%. The merged company is named as Indus Towers Limited. It was a major step in the direction of industrial consolidation. This consolidation had spur further mergers and acquisitions, creating a more stable and effective telecom industry, as Indian telecom providers continue to prioritize profitability and operational simplification.
Impact of Mergers on Competition Law in India:
The most popular mergers in Wireless Telecom Sector are Horizontal Combination. These combinations are more likely to cause Appreciable Adverse Effect (AAEC) in the Telecom market. A horizontal combination occurs when two companies in the same industry collaborate to gain market dominance. This kind of combination is the most prevalent and can lead to an AAAE. Because these mergers result in fewer market competitors and a larger proportion of the combined company, they typically have an impact on market concentration and dominance. Furthermore, ‘cartel arrangements’ that are defined by the Competition Act, 2002 as agreements that will negatively affect a linked industry. Market-sharing agreements, price-fixing agreements, big-rigging agreements, and agreements between rivals aiming to restrict supply, markets, or production are the four categories of cartel arrangements. However, the AAEC presumption won't apply if a joint venture enters into such an arrangement that increases efficiency.
The unilateral or poorly coordinated decision to merge could have a negative impact. In other words, they are able to boost their profit margins and gain a dominant position when the number of participants is decreased due to horizontal mergers.
Effects of Merger and Acquisitions in India:
Analysis and Conclusion
The issue of diminished competition as a result of mergers and acquisitions takes on significant importance since the telecom services serve as the foundation for end-user control. Major mergers in India as highlighted above shows the industry's trend toward consolidation as a result of fierce competition, pricing wars, and the necessity for increased profitability. Although M&As offer advantages like improved market efficiency and advances in technology, they also give rise to worries about diminished competition, fewer options for consumers, and the possibility of monopolistic practices. In order to give customers options and allow the government an opportunity to bargain with them, it is suggested that the government set the number of service providers in specific industries at a minimum of seven or ten. Another point of view is that since with the increasing population there is more mergers and acquisitions, this will result in hampering the customer experience. Therefore, even though there are countless opportunities for expansion, the telecom industry's massive growth is upsetting the lives of regular people.
Lalithambika Iyer, 4th Year BALLB student at Faculty of Law, PES University, Bengaluru.
Shark Tank India, the entrepreneurship-investor show has taken the entertainment world up by storm, captivating Indian audiences. With a viewership to rival its American Counterpart Shark Tank, where it originally started, its increasing influence is seen in popular culture through YouTube clips and memes on social media platforms. Some of the startups that have appeared on this show to seek investments from successful business moguls have flourished, while others have missed the mark. The show is known for its dramatized and engaging content, delving into the stories of the entrepreneurs and understanding the narrative behind their businesses. With a steadily increasing fan base and interesting collaborations across popular culture, Shark Tank India has made a mark for itself in the Indian Television scene. However, being in the spotlight comes with its detriments. Sony Pictures Networks India has issued legal notices to various startups that appeared on its show, for copyright infringement via Shark Tank. It was seen that the startups that appeared on the show were posting clips from the show that featured themselves on their social media platforms, generating significant traffic. This amounts to a violation of copyright, as the clips originally would be attributed to Sony Pictures Network India. Startups are shaken by the turn of events, and state their dismay at being unable to use their own business pitches as they did on Shark Tank, to market their own products. However, in the prominent field of content creation, the first-mover advantage is pivotal. The dwindling attention span of the consumers of content is targeted with short clips to ensure the message reaches across. At this juncture, Dorje Teas, a subscription-based startup company has been served a legal notice for a video on YouTube, claiming copyright infringement.
According to the Fair Use Doctrine, exceptions to the use of copyright are provided under various capacities around the world. YouTube acts on copyright infringement claims based on the local laws governing copyright and also provides for a fair use exception. According to the Indian Copyright Act of 1957 and its interpretation, the following are included in the fair use of copyright:
The above has been interpreted through decided cases setting precedents for understanding the doctrine of fair use. Section 52 of the Indian Copyright Act of 1957 lists out certain acts that do not constitute infringement of copyright, and are classified as “fair dealing” or fair use of the work. In the case of Addala Sitamahalakshmi vs State Of Andhra Pradesh , it was held by the Andhra Pradesh High Court that the use of a work for educational purposes amounts to fair use and falls under the exception of copyright infringement provided under Section 52 of the Act.
In the present case, Shark Tank claims copyright infringement of clips from their show, that was uploaded onto platforms such as YouTube by business owners and startups that appeared on the show as contestants. Such programs provide startups with the dual advantage of the possibility of securing funding, as well as media exposure and reach to pique customer interest and build a significant customer base. This highlights the problems that startups face in marketing and the legal challenges and permissions that come with the use of another’s intellectual property. The possible outcomes for this case might arise in the following manner:
It would work in the interest of Shark Tank if they outlined clear usage policies and due diligence, to prevent such happenings in the future. Startups must be aware of fair use of copyright and intellectual property, to prevent unnecessary legal challenges that hamper their growth. With their unmatched reach and engagement potential, digital channels such as the ones on social media are crucial to modern marketing for businesses and startups. The simplicity and ease of such marketing does come with legal challenges and risks, especially when it comes to intellectual property rights. The case of Dorje Teas brings to light the possible consequences of exploiting copyrighted material without the required permission, which might result in legal issues and confusion over fair use. Startups need to engage legal professionals, obtain express consent for material from other parties, and be aware of platform regulations and copyright laws. Putting a focus on producing unique content and being open about utilizing third-party information helps reduce risks and build brand awareness and credibility. It is pertinent to keep oneself informed on modifications to intellectual property laws and platform policies as the digital ecosystem develops.
Arnav Ashtikar, 4th year BALLB student at Symbiosis Law School, NagpurIntroduction
In Moti Ram v. State of Madhya Pradesh, the Hon’ble Supreme Court had emphasized for a humanitarian approach to bail in India. The case of is one such judgement which adds an utmost equitable, fair and reasonable nuance to the jurisprudence of bail law in India. Bail functions as a meaningful mechanism guaranteeing that the criminal trial is not tainted in order to find a compromise between this extreme measure in the interest of societal safety and individual person’s rights. Bail is the manifestation of equal protection of law as guaranteed by article 14 of the Constitution of India. However, it seems that the general procedural law i.e. Bhartiya Nagarik Suraksha Sanhita, 2023 under sec. 187 has diluted the right of an accused to get a bail. The aforesaid provision continues to exists inspite of the criticism which its corresponding provising under sec. 167 Code of Criminal Procedure had received. I shall make a two-fold argument in this comment, firstly, the concept of bail must be read in the light of substantive equality envisaged under article 14 of the Constitution of India and secondly, Explanation-II to sec. 187(5) of B.N.S.S. goes against the fundamental principles and purpose of granting bail.
Critique of Mandatory Bail Under Sec. 187 Of Cr.P.C.
It needs to be borne in mind that the objective of bail is to ensure that the accused appears in court when needed. Sec. 187(2) of the B.N.S.S. provides for default bail, commonly referred to as compulsory bail. If an investigation cannot be completed in twenty-four hours, sec. 187 of the B.N.S.S., 2023 allows and authorizes the judicial magistrates to authorise detention of an accused individual beyond 24 hours in case the he is satisfied that investigation by the police cannot be completed within a period of 24 hours as mandated of sec. 57 Cr.P.C. The words ‘special order of a Magistrate under Section 187’ used in sec. 58 are indicative of the premise that while sec. 58 is the general rule, sec. 187 is an exception insofar as the further detention of the accused beyond a period of 24 hours is authorized only by a magistrate who after applying his judicially mind has to decide whether further detention is to be authorized or not.
Sec. 187 specifies the longest period of time of detention that may be authorised. Interestingly, it must be noted that sec. 187 does not stipulate the maximum time within which the investigation should be competed rather, lists down the maximum period for which the accused may be detained which is given in the clause (i) and (ii) to the proviso (a) of sec. 187(3). The mandate of the proviso is that the person accused of an offence should not be detained for more than 90/ 60 days depending upon the punishment prescribed for the offence. Additionally, the proviso stipulates that the accused must be released on bail regardless of the nature of the accusations or charges against him or her if the investigation is not finished within the maximum time frame set by the proviso. From the said proviso, it is inferable that after the expiry of the stipulated time, the role of the accused is to furnish bail and subsequently on such furnishing of bail, the magistrate ‘shall’ release the accused on bail. Hence, in essence, if the investigation is not completed within the extended authorized detention of 90/ 60 days as the case may be, and, the accused furnished bail, the magistrate is duty bound to forthwith pass an order to release him on bail.
While this seems to be just and fair, problem arises in when we read this proviso along with Explanation-I. According to the Explanation-I to sec. 187(5), if the accused does not furnish bail after the expiration of the extended authorized detention of sixty/ ninety days, then he shall continue to remain in custody notwithstanding that the said extended period is over, she shall remain in detention. The author respectfully submits that this Explanation-I dilutes the important safeguard guaranteed to the arrested person under the sec. 187. The effect of this Explanation-I is that as long as the arrested person does not furnish bail, he shall continue to be in detention. This in itself is discriminatory primarily because it is obvious to assume that an affluent arrested person may conveniently and easily furnish bail, it is far-fetched and idealistic to assume that an indigent person can furnish the bail and the bail amount. Hence, the implication is that this creates a hindrance for the indigent poor arrested person to be released and exercise his right to have a default bail. It is submitted that equality provisions envisaging substantive equality also apply to the procedural laws. What the Explanation-I does in substance is that it creates two classes of arrested person- one which can furnish the bail and the bail amount and the other which cannot do so. It is submitted that while the former is guaranteed the safeguard of default bail under sec. 187, the latter are denied of their right to default bail unless they furnish bail which is the case of indigent persons is very idealistic and far-fetched to assume. This essentially goes against the very concept of procedural substantive equality as envisaged by the Constitution of India. To substantiate the importance of this safeguard to the arrested person, a 3-judge bench consisting of Justice RF Nariman, Justice Navin Sinha and Justice KM Joseph, in the case of Bikramjit Singh v. State of Punjab (2020 SCC OnLine SC 824), the court held that it is “a fundamental right granted to an accused person to be released on bail once the conditions of the proviso of sec. 167(2) (curresponding section of sec. 187 BNSS) are satisfied, and that the right to default bail is more than just a statutory right under the first proviso of sec. 167(2) Cr.P.C., but rather a component of the legal process established by art. 21 of the Indian Constitution.” It is respectfully submitted that the implication of this precedent is that denial to an indigent person to be released on bail after expiration of the maximum period of detention under sec. 187 is in return denial of his fundamental right. One may hope that the Hon’ble Supreme Court, whenever it gets an opportunity, should clarify the purpose, objective and constitutionality of this provision.
Conclusion
What we essentially come across while reading the case of Mori Ram’s judgement is an admirable, appealing and pulchritudinous amalgamation of the concept of American Realism, substantive equality and judicial activism. We truly believe that this judgement is essentially a means to bridge the gap between what stood in the ways of the poor people to get released on the bail- exorbitant amount charged by the magistrates without taking into account the financial capacity of the poor accused person to pay. The purpose of the right to bail is to give the accused of any crime the freedom to resume their normal activities after being released from detention. It becomes more difficult for the indigent to get their respective rights to be released on bail enforced. Further, as deliberated earlier, Explanation-I to sec. 187 of the B.N.S.S. has restricted the right of an indigent to compulsory or mandatory bail. This leads to the conclusion that one may even read the law as meaning that one gets what one pays for and doesn’t get what he can’t afford. However, in reality despite such judgements, it is regrettable that the courts in India are reluctant to grant bail quickly, causing many innocent people to languish in jail for extended periods of time before regaining their independence. Although it is a noble concept, we cannot realistically hope to eliminate all of the advantages the affluent defendant has over the poor. However, we would also like to highlight that the current money-based bail system’s most evident flaw is that it discriminates against impoverished defendants, blatantly contradicting the law’s stated goal of treating all defendants equally. Law, in the service of life, must interpret raw facts and provide for liberties.
Ioli Shukla, 5th Year BALLB Student at Maharashtra National Law University, Nagpur
The increasing focus on Environmental, Social, and Governance (ESG) criteria reflects a significant change in the global corporate and legal environments. These principles which include environmental conservation, social justice and corporate responsibility have shifted the focus of investments and business accountability. ESG clauses, embedded in commercial contracts and treaties, not only set sustainability goals but also allocate risks between parties. However, the integration of ESG standards has introduced novel complexities, giving rise to disputes over compliance, enforcement, and interpretation.
These disputes often involve complexities and are border-transcending with multiple stakeholders; hence, they require a resolution mechanism that can take into consideration such intricacies. Traditional litigation typically does not serve the fine-tuned complexities in ESG conflicts, particularly in situations where multiple stakeholders with varied regulatory requirements and ethical concerns are intertwined.
The nature of ESG disputes underscores the interplay between private obligations and public interest. Often, environmental disputes raise questions regarding the use of resources, the control of pollution, and climate commitments. Social conflicts relate to labour rights, human rights, and equal practices. Governance-related disputes tend to arise on the issues of transparency, anti-corruption practices, and rights related to the shareholder.
Therefore, an effective resolution mechanism has been in urgent demand as ESG obligations widen. Arbitration's procedural efficiency, confidentiality, and cross-border enforceability make it a promising alternative to litigation in such contexts.
Nature of ESG Dispute and Resolution Mechanism
ESG disputes stem from a variety of causes such as contractual breaches, regulatory non-compliance, and conflicts over treaty obligations. The broad and often ambiguous language of ESG clauses can lead to interpretive disputes. The dynamic and evolving nature of ESG principles further complicates these disputes, particularly as standards vary across jurisdictions and industries. Such conflicts are not limited to private contractual relationships but often involve wider societal concerns, amplifying their complexity.
The procedural intricacies that have been observed in the recent arbitration cases point out the potential of arbitration as a workable mechanism for resolving grievances, thereby promoting investor confidence and compliance with the Paris Agreement. It is at the intersection of corporate governance and ESG challenges that a more robust framework for the resolution of these disputes will be needed, in order to meet stakeholder interests as well as sustainability goals.
Resolving ESG Disputes through Arbitration
There is an increasing tendency of using investor-state and commercial arbitration to address ESG-related conflicts. Examples of environmental issues settled by investor-state arbitration include Churchill Mining and Planet Mining v. Indonesia [Churchill Mining PLC and Planet Mining Pty Ltd. v. Republic of Indonesia, ICSID Case No. ARB/12/14 and 12/40] and Perenco v. Ecuador [Perenco Ecuador Ltd. v. Republic of Ecuador, ICSID Case No. ARB/08/6.]. With respect to issues originating from ESG provisions, several attempts have been made to encourage their settlement through arbitration.
Despite its shortcomings, arbitration has numerous key characteristics that make it ideal for settling ESG conflicts. The option to choose arbitrators with specialised experience in ESG issues means that rulings are influenced by technical competence and contextual awareness. This is especially true in cases requiring complicated environmental rules or social effect studies. The procedural flexibility of arbitration enables parties to customise procedures to the specifics of their conflicts, resulting in a more nuanced and efficient settlement process.
The ICC Commission Report titled ‘Resolving Climate Change Related Disputes through Arbitration and ADR’ recognises that arbitration is well-established in resolving environmental disputes. It noted a surge in the number of environmental protection lawsuits filed with the ICC and other arbitration agencies. Arbitration is chosen over alternative conflict resolution procedures for climatic (environmental) concerns because it provides a neutral tribunal, more procedural flexibility, competence and accessibility, and cross-border recognition and enforcement of awards.
Governments have recently begun to openly consider ESG concerns in trade and investment agreements. The Dutch Model Treaty (2019), Belgium-Luxembourg Economic Union Model BIT (2019), and Italian Model BIT (2022) are the most visible examples of progressive model treaties that are expected to be adopted by other governments, a tendency that will definitely increase the number of ESG conflicts in the future.
Furthermore, arbitration’s enforceability across jurisdictions, facilitated by the New York Convention, provides a significant advantage in cross-border disputes. Given that many ESG obligations arise in international contexts, this feature ensures that arbitral awards are recognized and implemented globally. This is particularly beneficial for addressing conflicts arising from multinational agreements or treaties, where the involvement of diverse legal systems can complicate enforcement through traditional litigation.
Arbitration’s adaptability extends to the use of interim measures, which can be critical in ESG disputes requiring urgent intervention. For example, in cases of imminent environmental harm or serious human rights violations, arbitration allows parties to seek immediate remedies, mitigating further damage while the dispute is resolved. This capability highlights arbitration’s potential to address not only the legal dimensions of ESG conflicts but also their practical implications.
Limitations of Arbitration in ESG Disputes
While arbitration has clear benefits, its limitations cannot be overlooked. The private nature of arbitration proceedings may conflict with the public interest dimensions of certain ESG disputes. This tension is particularly evident in environmental and human rights cases, where the affected parties often include communities or individuals who are not directly involved in the arbitration. The exclusion of such stakeholders from proceedings raises concerns about the inclusiveness and legitimacy of arbitral outcomes.
Another limitation is the potential imbalance of power and resources between disputing parties. In employer-employee conflicts or disputes involving indigenous communities and corporations, resource disparities can affect the fairness of the proceedings. While arbitration provides opportunities for parties to seek third-party funding, concerns about undue influence and control by funders remain. Addressing these issues requires a careful balancing of interests and the incorporation of safeguards into arbitration agreements and institutional rules.
Moreover, ESG claims often involve complex calculations for quantifying damages. As such, quantifying such injuries in the arbitration proceedings is one of the major difficulties, most notably concerning environmental or social harms. There exists, as of now, no consensus over the methodologies for arriving at the same, which poses a significant challenge for Arbitration as an ADR mechanism for resolving ESG disputes. Nevertheless, arbitral institutions have begun to tackle this by accepting rules which permit some level of disclosure in proceedings when there is a question of public interest.
Enhancing Arbitration to Address ESG-Related Disputes
To maximize arbitration's potential to help resolve ESG disputes, several reforms are in order. For one, drafting of ESG clauses requires precision and will depend on the specific needs of parties. The use of clear language and measurable standards can reduce interpretive disputes and ensure enforceability.
Secondly, the arbitral institutions need to continue building up their rules and guidelines so as to accommodate ESG-related characteristics. These may be exemplified through the Hague Rules on Business and Human Rights Arbitration, which seeks to provide a framework for addressing human rights-related conflicts.
The challenge would also be balancing confidentiality with transparency. Besides procedural efficiency, arbitration in ESG disputes would have benefits beyond that: its confidentiality and flexibility make it much more appealing than traditional litigation. Unlike court proceedings that tend to be public in nature with the potential for sensitivities over disclosure, parties will also have a private platform where one can resolve disputes through arbitration by not having reputational issues and proprietary information issues coming public. This is especially so given ESG disputes where environmental practices as well as labour standards on companies may bring unwanted exposures.
These, therefore, result in a more benevolent environment of resolution but allow parties to broach even the most complex issues in manners that traditional courts may not permit.
Conclusion
As companies increasingly take into account ESG factors in their operations, the need for effective mechanisms for dispute resolution evolves as well. Arbitration, with its flexibility and expertise, is a promising framework for addressing the complexities of ESG disputes. Targeted reforms and inherent advantages can make arbitration play a pivotal role in advancing sustainable development and corporate accountability. With ESG considerations redefining legal and corporate landscapes, arbitration needs to undergo changes to ensure it remains relevant and effective in solving critical issues.
While arbitration offers a forum for resolving complex disputes that arise from ESG concerns, questions of legality and ethical considerations remain paramount. Thus, the effective implementation of arbitration processes in ESG disputes requires a balanced approach that prioritizes ethical governance while ensuring that legal mechanisms remain robust enough to enforce compliance and promote sustainable investment practices.
In this changing landscape, transparency and accountability will be the cornerstones for maintaining the credibility of arbitration as a dispute resolution mechanism. The future of arbitration will depend on its ability to embrace these changes, thereby reinforcing its role in promoting responsible business conduct in line with contemporary societal expectations.
Raghav Garg, 2nd year BALLB student at Symbiosis Law School, Nagpur
JOHN STUART MILL (1806–1873) was an eminent British economist, philosopher, and jurist, who was widely considered as the founding father of the development of modern-day liberalism and utilitarianism. Mill began his career with the British East India Company and worked there for 35 years and later emerged as one of the greatest philosophers. His works include a variety of topics, including economics, philosophy, and social theory, and he is best known for his writings on liberty, utilitarianism, and representative government.
In his seminal work “ON LIBERTY,” published in 1859, Mill argues for individual freedom, personal autonomy, and the limits of authority. He articulates the protection of individual rights against the social and political interventions, highlighting the importance of liberty in shaping personal and societal progress, and continues to shape discussion in this contemporary world.
Historical Context and Influences On Mill's Ideas On Liberty
J.S. Mill's views on liberty were influenced by the currents of his time, mainly in the 19th century, together with intellectual and personal freedom. Mill's ideas were majorly moulded by the philosophers like John Locke and Voltaire, who advocated for Social Contract and individual Freedom. Moreover, Jeremy Bentham, an English philosopher, being Mill’s mentor and the founder of utilitarianism, shaped Mill's ideas with his key principle of "the greatest happiness for the greatest number."
Moreover, the industrial revolution of the 18th and early 19th centuries brought impactful social and economic changes, emphasising issues associated with individual freedom & economic freedom. Mill’s thoughts on the significance of social and economic reforms to protect liberties were influenced by these developments. Britain in the 19th century also brought about political freedom, such as extension and the right to vote. Mill, however, actively participated in these debates, promoting a society with a more democratic and inclusive structure.
Personal influences of J.S. Mill also played a vital role in shaping his ideas, as his father, James Mill, provided him a utilitarian upbringing, whereas his progressive thoughts on women's rights and equitable society were formed by his intellectual partner, Harriet Taylor Mill. Furthermore, the German ideas and romanticism had a devastating impact on Mill's philosophy. Therefore, in this present-day Mill’s concept of liberty as expressed in “ON LIBERTY,” synthesises these ideas by highlighting the value of individual freedom, autonomy, and the boundaries of state power.
Key Principles of Liberty in Mill's Philosophy
Mill’s philosophy on liberty was primarily articulated in his seminal work on liberty, which turned around several key principles that advocated for individual freedom, autonomy, and the limits of authority. Initially, Mill believes in absolute freedom of the individual from any kind of oppression and the freedom to choose and express any opinion, even if it is wrong or unpopular. He further emphasised that people should be free to live their lives in their own way to develop their unique abilities. Mill believes that having different lifestyles and choices led to greater happiness for a greater number.
The key idea of Mill's philosophy is the Harm Principle is that individual should be free to do whatever act they want unless it causes harm to others. This sets a clear limit on when society or the government can step in and interfere with someone's actions. This concept has been broadened by Mill to include liberty of action, which believes that people must be allowed to follow their passions, pastimes, and activities without unnecessary interference. He thinks that this kind of independence is essential to both individual development and the advancement of society at large. Lastly, Mill warns against the "tyranny of the majority," where the views and norms of the majority can oppress minority opinions and individual freedoms if not regulated. Therefore, he advocates for systems that protect individuals from being overruled or oppressed by the majority, ensuring that everyone's rights and freedoms are valued.
Mill was also a utilitarian, and along with Jeremy Bentham, he connotes the idea of utilitarianism, which states that the act that promotes overall happiness in the human being. He believes that if all these acts promote social welfare, happiness, better working conditions, reduce crime, or improve health, then laws should be legalised but not criminalised.
Critiques and Contemporary Relevance of Mill's Concept of Liberty
John Stuart Mill's concept of liberty, particularly as delineated in his seminal work On Liberty, has been one of the most significant frameworks for thinking about individual freedom. However, despite its deep influence, Mill’s ideas have faced several critiques over the years. As well as his philosophy is highly relevant in contemporary debates of liberty and equality.
As already discussed earlier, the centre of Mill’s philosophy is the “Harm Principle” which states that individuals should be free to do as they wish unless their actions harm others. While critics argue that this concept of Harm Principle is vague and difficult to apply in practice, as he does not clearly define what constitutes a harm, furthermore, his theories do not depict economic and social inequalities, which can limit true freedom for some individuals. Moreover, Mill warns about the tyranny of the majority, that these societal norms or the collective will of the majority may suppress minority views or individual freedoms. However, people argue that the tyranny of the majority has not disappeared but has taken new forms. Notwithstanding these criticisms, Mill’s “On Liberty” continues to be a foundational text in liberal thought and continues to influence modern-day liberty, minority rights, and advocating for the protection of individual freedoms. His work remains a foundation stone in the ongoing encounter of defining and protecting liberty in an evolving world.
Conclusion
J.S. Mill's seminal work ON LIBERTY hails as a cornerstone of individual freedom and the limits of authority. Whereas his idea of the harm principle faces several criticisms over its application and the failure to address economic and social inequalities, they remain highly relevant today. Overall, Mill’s work continues to shape debate on liberty, justice, equality, and the balance between personal freedom and collective responsibility.
Misba Tareen, 5th year BBALLB student at PES University, Bengaluru
Mechanisms such as the General Agreement on Tariffs and Trade (GATT), which was created in 1947 with the intention of lowering trade barriers and promoting economic growth following World War II, have helped to shape global trade systems. The formation of the World Trade Organization (WTO) in 1995 further institutionalized multilateral trade liberalization, promoting inclusivity and uniformity in global trade practices.
In parallel, regional trade agreements (RTAs) such as NAFTA and the European Union have proliferated, particularly since the 1990s. RTAs seek to lower trade barriers within particular regions, but because they are exclusive, they may fragment global trade rules, undermining the WTO's objective of a cohesive multilateral system. This phenomenon, known as the "spaghetti bowl effect" – a term coined by economist Jagdish Bhagwati – complicates trade governance with overlapping rules.
Regional Trade Agreements (RTAs) are trade agreements between a group of countries, often geographically proximate, that aim to reduce or eliminate trade barriers among member states while maintaining barriers for non-members. Preferential treatment of member countries is a defining feature of RTAs, which aim to promote economic integration within a particular region by lowering tariffs, quotas, and other trade barriers. They could be anything from basic free trade agreements to more intricate political and economic alliances.
Since its founding in 1995, the World Trade Organisation (WTO) has been instrumental in promoting global trade negotiations and offering a framework for multilateral trade liberalisation. The WTO's primary objective is to ensure that trade flows as smoothly, predictably, and freely as possible, promoting global economic growth through non-discriminatory trade practices. The WTO's multilateral agreements seek to establish a predictable and non-discriminatory global trade system, but progress has frequently been sluggish due to the difficulties in balancing the disparate interests of its 164 member nations. This has contributed to the rise in RTAs, as countries seek faster means of securing trade benefits.
RTAs concentrate on specific geographic regions, allowing them to focus on the unique economic and political needs of the member states, promoting deeper regional integration. Further, they give members preferential terms while frequently discriminating against non-members, which contradicts the global inclusivity principle of multilateralism. Multilateral agreements such as the WTO, on the other hand, involve a diverse range of countries across different regions and encourage uniform, non-discriminatory trade regulations across various nations.
RTAs, by having more flexibility in the negotiations, enable quicker, tailored agreements for regional needs, expediting benefits for members. In contrast, multilateral agreements emphasize inclusivity but often face delays due to diverging interests among developed and developing countries, making the process complex and time-consuming.
The growth of RTAs has created overlapping agreements, inconsistent rules, increasing complexity, and higher administrative costs for businesses, creating challenges for global trade governance. In contrast, the WTO, through multilateral agreements, establishes uniform rules, promoting predictable and fair global trade governance for all members.
RTAs often lead to trade creation among member countries, as reduced barriers increase intra-regional trade flows. However, they may divert trade from efficient non-members, causing global inefficiencies. Multilateral trade agreements aim for global trade creation, reducing discriminatory practices and promoting an open trading environment that benefits all participants. By promoting equal treatment, they foster efficient global trade and economic growth.
The North American Free Trade Agreement (NAFTA), 1994, now replaced by the United States-Mexico-Canada Agreement (USMCA) in 2020, exemplifies deep economic integration among the U.S., Canada, and Mexico. NAFTA focused on reducing tariffs, eliminating trade barriers, and fostering economic cooperation across various sectors, such as agriculture, manufacturing, and services. The agreement not only aimed to enhance trade among the member countries but also sought to encourage foreign investment and strengthen intellectual property protections within the region.
Although NAFTA/USMCA has increased regional trade, some contend that it favours members over non-members and fragments the global trade system. Because NAFTA/USMCA countries receive preferential treatment, non-member nations that depend on WTO regulations may find it difficult to compete in the North American market.
The WTO promotes fair trade among its 164 members, but the rise of RTAs like NAFTA/USMCA challenges its effectiveness. These regional agreements can create a "hub-and-spoke" system, where members gain advantages over non-members, leading to trade diversion and inefficiencies.
The European Union (EU) represents one of the most integrated forms of an RTA through its customs union and common external tariff. Established initially as the European Economic Community (EEC) in 1957, the EU has evolved to encompass a wide range of policies, promoting not just free trade among its member states but also aligning economic, environmental, and social regulations. The EU's common market facilitates the free movement of goods, services, capital, and labour, creating a high level of economic interdependence among its members.
While the EU’s internal regulations and standards can promote high levels of consumer protection and environmental sustainability, they often exceed the commitments established in WTO negotiations. For instance, the EU has implemented stricter environmental and labour standards, which can create challenges for non-member states seeking to access the European market. This divergence raises concerns regarding potential trade barriers that non-members may face, as they might struggle to meet these higher standards.
Furthermore, the EU's insistence on including provisions related to environmental sustainability and labour rights in its trade agreements reflects a shift toward “new-generation” trade agreements that prioritize these issues more than traditional WTO commitments. However, critics argue that such standards can lead to trade discrimination, as non-EU countries may be excluded from accessing the European market if they cannot comply with these elevated criteria, thus potentially undermining the principles of the WTO.
Global trade governance is fragmented by the increasing number of RTAs with varying standards and regulations, which makes it more difficult for the WTO to enforce a unified framework. This discrepancy erodes the coherence of the global trade system and creates confusion for importers and exporters.
RTAs circumvent WTO mechanisms, undermining the organization's ability to resolve disputes and enforce trade rules. This shift jeopardises the relevance of the WTO and undercuts multilateral principles. As countries turn to RTAs for quicker resolutions, the multilateral trading system risks becoming increasingly irrelevant.
RTAs can support multilateral initiatives by promoting integration and adhering to WTO guidelines. RCEP is one example that promotes global system alignment while enhancing regional trade.
RTAs can have more stringent rules than WTO accords, which makes it harder for businesses to comply with. These inconsistencies have the potential to cause disagreements between members and non-member nations, which would complicate global trade and reduce the effectiveness of both RTAs and the WTO framework.
Governments must balance regional interests with their global commitments to the World Trade Organization (WTO) as they negotiate Regional Trade Agreements (RTAs). Key strategies include:
The WTO needs to adapt to the growing influence of RTAs by:
Businesses operating in global markets should consider the following strategies:
Regional Trade Agreements (RTAs) and multilateral trade liberalization offer distinct benefits and challenges. While RTAs enable quicker, region-specific trade agreements, they risk undermining the global inclusivity promoted by the WTO. Striking a balance between regional integration and global trade governance is essential for fostering sustainable economic growth and stability. Policymakers, businesses, and global institutions must work collaboratively to align RTA initiatives with multilateral principles, ensuring a cohesive and efficient global trading system.
Srishti Surana, 4th year BComLLB student at Institute of Law, Nirma University, Ahmedabad
When a company is unable to pay its debt and the default occurs, the Corporate Insolvency Resolution Process (“CIRP”) is initiated by the application filed by the Corporate Debtor (“CD”), Financial Creditor or Operational Creditor under sections 7, 8, or 10 of Insolvency and Bankruptcy Code, 2016 (“IBC”). Upon initiation of CIRP, the moratorium period under Section 14 gets triggered for 180 days which could be extended up to 330 days.
Arbitration proceedings are derived from the parties' contract, hence it is required to govern the matters of only those who consent to its jurisdiction, i.e., personam proceeding, it is not intended to harm the interests of those who are not parties to the arbitration agreement.
Insolvency proceedings have an "erga omnes" effect after admission of application and it impacts the rights and obligations of all the creditors involved. Therefore, the disputed rights and responsibilities are owed to the public at large, or in rem.
Where a company on which a moratorium has been applied and the company is in an Arbitration agreement, it is usually a point of jurisprudence that what will prevail over what. Section 14 clearly states that all the proceedings which are against the corporate debtor cannot be initiated or continued during the moratorium period and it includes arbitration proceedings.
In the Alchemist Asset Reconstruction Company Limited v. M/s Hotel Gaudavan Private Limited, the Supreme Court decided that while a moratorium under Section 14 of the IBC exists, arbitration proceedings against a corporate debtor cannot be initiated or continued.
The Supreme Court ruled that the IBC's provisions shall take effect regardless of any conflicting clauses in laws that have previously been passed. The SC has consistently held that the IBC is a comprehensive code in and of itself. Its provisions shall supersede any discrepancies with other currently enacted laws in light of Section 238. All previous laws are superseded by Section 238 of the IBC.
In an intersection between arbitration and insolvency, the insolvency procedure would take precedence, limiting a party's capacity to challenge or defend its claims through a dispute resolution process. For the purpose of this issue, Section 238 of the IBC specifies that IBC overrides all other laws in existence, and hence moratorium under Section 14 of IBC applies to the present arbitration proceeding.
Since arbitration proceedings are right in personam it won’t be appropriate for the proceedings to impact proceedings in rem. However, the courts in India also have taken a different approach in dealing with these cases. There are certain cases where the courts have allowed the arbitration proceedings when it is in favour of the corporate debtor or is not directly related to the insolvency proceedings.
To decode this, the courts have first addressed at what stage of CIRP the arbitration proceedings are going on. There are two possible scenarios in which the arbitration proceedings will come into the picture, first, that it is initiated before the initiation of the CIRP, can the proceedings be continued post the initiation of the moratorium, and second, the arbitration is triggered after the initiation of the moratorium. Can at this stage the proceeding even be initiated?
The courts first looked at the definition of Section 14 and interpreted it only prohibits the proceedings which are against the corporate debtor, i.e. it allows the proceedings which are in favour of the corporate debtor.
In the case of Jharkhand Bijli Vitran Nigam Ltd, the NCLAT ruled that Section 14 should not be construed to prohibit arbitration proceedings encompassing claims and counterclaims by the corporate debtor and the opposing party. The tribunal specified that if following the hearing of these claims and counterclaims, the arbitrator(s) issues an award against the corporate debtor, enforcement of such an award cannot take place during the moratorium period. Staying on proceedings that might enhance the financial resources of the CD would contradict the objectives of the IBC.
The SC in the Power Grid Corporation case ruled that the Purposive rule of interpretation would be followed and that the scope of section 14 would be restricted to only recovering debts against the corporate debtor rather than being interpreted to cover "all sorts of proceedings." In the case of Fourth Dimension Solution Solutions Ltd. v. Ricoh India Ltd., NCLT New Delhi granted permission to an operational creditor of the CD to continue arbitration proceedings despite the Committee of Creditors and the Apex Court having approved the CIRP. Proceedings that do not include debt recovery action facilitating in the smooth execution of CIRP and assuring that the business can go on as a going concern can continue during insolvency proceedings.
The SC in the case of P. Mohanraj & Ors. Vs. M/S. Shah Brothers Ispat Pvt. Ltd., overruled the judgment of Power Grid Corporation and held that Section 14 of the Code would not apply to the proceedings that are in the benefit of the corporate debtor, like the one before this court in as much these proceedings are not a ‘debt recovery action’ and its conclusion would not endanger, diminish, dissipate or impact the assets of the corporate debtor in any manner whatsoever and hence shall be in sync with the purpose of moratorium which includes keeping the corporate debtor’s assets together during the insolvency resolution process and facilitating orderly completion of the process envisaged during the insolvency resolution process and ensuring the company may continue as a going concern.
However, this position of law has been criticized by the courts, and despite the judgment, it is been rarely cited by the courts in dealing with similar matters. Allahabad HC in Trading Engineers has underscored that the ratio of Mohanraj should be seen in the context of the case and should not be considered as a blanket ban on all proceedings.
The interplay between arbitration and insolvency proceedings in India presents a complex legal landscape. While the general principle upholds the primacy of insolvency proceedings under the IBC, particularly during the moratorium period, recent judicial interpretations have carved out nuanced exceptions. These exceptions allow for the continuation or initiation of arbitration proceedings that are in favour of or not directly detrimental to the corporate debtor. This evolving jurisprudence reflects a delicate balance between protecting the interests of all creditors in insolvency and respecting the sanctity of arbitration agreements. As the law continues to develop, it is crucial for practitioners and stakeholders to closely monitor these developments and approach each case with a nuanced understanding of both arbitration and insolvency laws. The courts' emphasis on a purposive interpretation of Section 14 of the IBC suggests a trend towards a more flexible approach, one that aims to harmonize the objectives of insolvency resolution with the principles of arbitration, ultimately serving the broader goals of economic efficiency and justice.
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