New IT Rules 2021 have received negative remarks from 85 percent of social media and internet intermediaries concerned that the compliances would affect the ease of doing business in India.

The industry stakeholders survey indicates concerns over several portions of the new rules from the originator traceability to maintaining a threshold of five million users to be designated as a significant social media intermediary in India.

They also expressed concerns over the infeasibility of the originator traceability mandated in the new rules since the ramifications of imposing personal liability on chief compliance officers may have and the impact due diligence requirements will have on entry barriers and the ease of doing business.

Intermediaries and cybersecurity experts expressed that it is technically impossible to introduce traceability on end-to-end encrypted platforms without breaking the encryption technology itself.

Additionally, a report titled 'IT Rules, 2021: A Regulatory Impact Assessment Study', by the Internet and Mobile Association of India (IAMAI) and The Dialogue, suggest for a progressive intermediary liability regime instilling procedural safeguards to aid law enforcement agencies, while furthering a uniform and transparent content blocking regime.

According to Rajya Sabha MP Amar Patnaik, based on the content removal timelines, the takedowns must be graded and must not be compared to differing forms of harm or put them in the same basket.

Regarding resident grievance officers, the IT Ministry said that complaints from users on removal of content, suspension, blocking or removal of user accounts, should be acknowledged within 24 hours, the problem should be redressed in 72 hours and disposed of within 15 days.

The report stressed that there should be a detailed Standard Operating Procedure explaining the criteria of calculation of the threshold and uiding the executive’s power to mandate any intermediary to comply with the additional due diligence mandates.

"Majority of the intermediaries dealing with large amounts of user generated content noted that there is a need for grading the takedown orders according to the degree of harm to enable sufficient time for assessing the genuineness of the requests," according to the findings.

"Majority of the intermediaries noted that in a country like India with a population of 1.3 billion setting a threshold of 5 million users to be designated as a significant social media intermediary is quite onerous from an economic standpoint," says the report.