The import of medical devices including in-vitro medical devices (hereinafter referred to as “medical devices”) in India is regulated by India’s central medical device regulator, the Central Drugs Standard Control Organization (CDSCO). In order to import a medical device into India, the importer has to make an application for import license Form MD-14 of Medical Devices Rules,2017 (MDR, 2017) before CDSCO. Once the application is processed successfully, the CDSCO grants an import license to the importer in Form MD-15 of MDR, 2017.
For Class A and Class B medical devices: 1st October 2022
For Class C and Class D medical devices: 1st October 2023
In the paragraphs below, we have answered some of the common questions regarding timelines for obtaining import license for medical devices on the basis of our working knowledge of the law and prevailing practice.
1. What is the usual time within which an import licence may be granted by CDSCO?
The prescribed timeline for issuance of import license is nine (09) months from the date of application. However, the timeline is suspended if a query on the application is raised by CDSCO.
2. What is the approximate timeline for receiving query from CDSCO on the import license application?
As per current estimate, a query is typically received within a span of 3-4 months from the date of import license application. Please note that CDSCO may raise multiple rounds of queries.
3. How much time does an applicant of import license gets to reply to the queries?
The general expectation of CDSCO is that the queries should be responded within forty-five days from the date of receipt of queries.
4. What happens if a query cannot be responded within 45 days?
If the applicant is facing a difficulty in replying to the query, an intimation may be sent to CDSCO justifying the reason for delay and providing appropriate undertaking.
5. What is the maximum time within which queries have to be responded?
There is no official time limit for responding to the queries which has been stipulated by CDSCO. However, the expectation is to respond to the queries within the reasonable time frame.
6. What is the timeline by which the response to the queries is processed by CSDCO?
There is no prescribed timeline for processing the queries by CDSCO. However, the timeline for grant of import licence is nine (09) months from the date of filing of the application.
7. Is the time taken by the authorities to grant an import licence includes the time taken by the importer to respond to the queries?
No. The total timeline of nine months prescribed for grant of import license is not inclusive of the time taken by the importer to respond to the queries.
8. What is the time limit in which the importer can appeal to the Central Government in case the application is rejected by CSDCO?
If the application is rejected by CDSCO, the applicant may appeal to the Secretary, Ministry of Health and Family Welfare within a period of forty-five days. The Secretary or another officer designated by the Secretary may, after conducting an enquiry into the matter as considered necessary, pass orders in relation to the appeal within a period of ninety days from the date of appeal.
9. What is the validity of import license granted in Form MD-15?
The licence granted by CDSCO under Form MD-15 is valid in perpetuity unless cancelled or surrendered. The validity of the license so granted is subject to the payment of the retention fee by the importer.
10. When is importer license retention fee due to be paid?
The retention fee to retain import license has to be paid by the importer every 5 years.
11. What if the importer of medical device fails to pay the retention fee within the prescribed time period?
If the import licence holder fails to pay the required retention fee on or before the prescribed due date, the license holder is required to pay a late fee in addition to the retention fee.
The late fee will be calculated at the rate of two per cent (2%) of the import license retention fee for every month or part thereof within ninety days. Non-payment of fee until expiry of ninety days will result in cancellation of the import license.
In this article, we have discussed rounding-off principles that manufacturers and importers of drugs and medical devices should follow while determining the maximum retail price (MRP) of their products.
What is rounding-off? Rounding-off refers to adjusting a fractional price of a drug or medical device to the nearest rupee, or the nearest paisa, depending on the context.
Why is rounding-off relevant for drugs and medical devices? The MRP of drugs and medical devices is regulated by a law called the Drugs (Prices Control) Order, 2013 (“DPCO”). If a manufacturer or importer decides to round-off the MRP of a drug or medical device for any reason, for example, pursuant to an increase or decrease in applicable taxes, and the rounding-off is not acceptable as per provisions of DPCO, then it may result in recovery of the overcharged amount from the manufacturer or importer.
What are the principles of rounding-off prescribed under DPCO? The DPCO itself is, as such, silent on the rounding-off of MRP. However, the authority responsible for enforcement of the DPCO, the National Pharmaceutical Pricing Authority (NPPA), has recognized the fact that rounding-off of MRP is an acceptable market practice [NPPA Minutes, 2016]. It is acceptable to NPPA that rounding-off of MRP is done as per ‘general mathematical practice’.
What is the general mathematical practice of rounding-off? The general mathematical practice is to round-off the second decimal place of the MRP, depending on the number present at the third decimal. If the number present at the third decimal place is 5 or bigger than 5, then the number present at the second decimal place may be increased by 1. If the number present at the third decimal is less than 5, then the number present at the second decimal place will not change. Some illustrations:
S No.
Actual Figure
Rounded-off Figure
1.
Rs. 123.45/-
Rs. 123.45/-
2.
Rs. 123.455/-
Rs. 123.46/-
3.
Rs. 123.456/-
Rs. 123.46/-
4.
Rs. 123.991/-
Rs. 123.99/-
5.
Rs. 123.999/-
Rs. 124.00/-
6.
Rs. 123.001/-
Rs. 123.00/-
7.
Rs. 123.111/-
Rs. 123.11/-
The above understanding was validated by the Delhi High Court in the case of Union of India v Bharat Serums.
Whether rounding-off is permitted for medical devices under Legal Metrology (Packaged Commodities) Rules, 2011? The MRP of medical devices is regulated by DPCO as well as Legal Metrology (Packaged Commodities) Rules, 2011 (“LMPC Rules”). Until 23.6.2017, the LMPC Rules had a provision to round off the fractional MRP to the nearest rupee. In other words, medical devices were permitted to round-off the fraction of less than fifty paise to the preceding rupees and a fraction of above 50 paise and up to 95 paise to the rounded off to fifty paise. However, the above provision was omitted from LMPC Rules with effect from 1.1.2018. Therefore, the MRP of medical devices today cannot be rounded off, except in the case of the second decimal place, as described earlier.
Can a manufacturer or importer of medical devices round-off MRP of medical devices to the nearest rupee or 50 paise? The simple answer is no, especially not after 2018. Before this, it was at least arguable that manufacturers and importers of medical devices could rely on the provisions of LMPC to take a position that they had the flexibility to round-off the MRP to the nearest rupee or 50 paise. The price regulator, NPPA, however, has not accepted this position. Post 2018, there is no basis for manufacturers and importers of medical devices to take such a position since the supporting LMPC provisions are now omitted. Please note that manufacturers and importers of drugs could never take benefit of the flexibility of rounding-off under LMPC Rules for fixing MRP because LMPC Rules do not apply to drugs.
Conclusion The flexibility to round-off MRP in the case of drugs and medical devices is available up to the second decimal place only, as per general mathematical practice. Any error in rounding-off for drugs and medical devices can result in significant recovery from manufacturers and importers under the provisions of the Drugs (Prices Control) Order, 2013.
The Division Bench of the High Court of Delhi, in the case of Union of India v Bharat Serums, has laid down how the overcharged amount should be calculated by India’s drug price control regulator, National Pharmaceutical Pricing Authority (“NPPA”). The judgement will have a significant impact on existing as well as future demands for overcharging which are raised on pharmaceutical and medical device companies in India.
Background
Under Para 20 of India’s drug price control law, the Drug (Prices Control) Order, 2013 [“DPCO”], all non-scheduled formulations are allowed to increase their price by 10% in 12 months. Non-scheduled formulations are non-essential drugs or medical devices that are not listed in the schedule of DPCO. Most pharmaceutical and medical device companies do not use the 10% price increase opportunity in the 12-month period and elect to increase the price after a number of years.
When the opportunity does arise to increase prices, the question that always arises is whether the company can increase the price by the ‘aggregate’ of permitted percentage increase, or by a maximum of 10% from its last published Maximum Retail Price (MRP). For instance, if the MRP of a drug or medical device was Rs. 100, and the company selling the product decides to increase the price of the drug or medical device after a period of 5 years, would it be entitled to increase the price of the product by Rs. 50 (10% increase allowed every 12 months period), or by Rs. 10 (10% increase from last MRP irrespective of the time gap).
The other question that arises is if a pharmaceutical or medical device company increases the MRP of its product by more than 10% in a 12-month period, then how should NPPA recover the overcharged amount? For instance, if the MRP of a drug or medical device was Rs. 100 earlier, and if the company revises the MRP of the product to Rs. 200 after 5 years, how should NPPA calculate the overcharged amount? Should NPPA assume that the company was only allowed to increase MRP by 10% and recover the remainder amount as an overcharged amount? In other words, should NPPA give a concession of Rs. 10 to the company and proceed to recover Rs. 90, or should NPPA ‘assume’ that the company would have increased its price by 10% each year, and proceed to recover only the balance amount, in this case Rs. 50 (or more accurately Rs. 39 since a 10% increase every year for 5 years would have resulted in MRP of Rs. 161).
The above questions were conclusively answered by the Delhi High Court and are discussed below.
Interpretation of 10% permissible price increase in 12-month period
The Delhi High Court has interpreted the 10% allowance to increase MRP as follows: the MRP of non-scheduled formulations can only be increased by 10% in a period of 12 months, at a time, but in case of overcharging, the NPPA will have to assume that the company would have taken the 10% MRP increase and will be permitted to recover the ‘net’ amount.
The above interpretation is explained using examples in the paragraphs below.
Examples
What is permissible MRP increase for a pharmaceutical or medical device company?
If the MRP of a non-scheduled drug or medical device was Rs. 100 in 2014, the permissible price increase on yearly basis would be as follows:
Years
01.01.2014
01.01.2015
01.01.2016
01.01.2017
01.01.2018
01.01.2019
01.01.2020
Actual MRP
100
110
121
133.1
146.41
161.05
177.15
If a pharmaceutical or medical device company wishes to take 10% increase after 5 years, how much can that be?
If the MRP of a non-scheduled drug or medical device was Rs. 100 in 2014, and the company decided to take a price increase in 2019, the maximum permissible price increase would be Rs. 110.
Years
01.01.2014
01.01.2015
01.01.2016
01.01.2017
01.01.2018
01.01.2019
01.01.2020
Actual MRP
100
100
100
100
100
110
121
How should the overcharged amount be calculated, in the event of default by a pharmaceutical or medical device company?
In a hypothetical scenario, where the MRP of a non-scheduled drug or medical device was Rs. 100 in 2014, and the company decided to increase it to Rs. 161.05 in 2015 and later to 177.15 in 2020, the overcharged amount will have to be calculated as follows:
Years
01.01.2014
01.01.2015
01.01.2016
01.01.2017
01.01.2018
01.01.2019
01.01.2020
Total ovecharged amount
Actual MRP
100/-
161.05
161.05
161.05
161.05
161.05
177.15
–
Permissible MRP (with 10% increase)
Not applicable
110
121
133.1
146.41
161.05
177.15
–
How NPPA calculated overcharging amount ? (Not legal)
Not applicable
51.05
51.05
51.05
51.05
0
0
204.2
Overcharged amount as per Delhi High Court
Not applicable
51.05
40.05
27.95
14.64
0
0
133.69
The above table is instructive because it illustrates the incorrect methodology applied by NPPA to calculate the overcharged amount that has been routinely demanded and recovered by NPPA so far from pharmaceutical and medical device companies.
Until the Delhi High Court judgement, the NPPA demanded an amount which was excessive and incorrectly calculated (Rs. 204.2). However, after the Delhi High Court judgement, irrespective of the amount that has been calculated by the NPPA, the actual payable amount will be significantly lower than the amount demanded by NPPA (Rs. 133.69).
Impact
This particular Delhi High Court judgement on permissible price increase of drugs and medical devices will have a far-reaching impact on existing overcharging demands which have been raised by NPPA, and the demands that NPPA will raise in the future. All existing demands for overcharging raised by NPPA, which have been calculated using incorrect methodology due to incorrect interpretation of overcharging provisions of DPCO by NPPA, should be rolled back by the NPPA. A pharmaceutical or medical device company that has currently received such a demand should strongly object to the NPPA’s demand on the strength of the Delhi High Court judgement.
Pharmaceutical and medical device companies should also be careful in taking price increases for non-scheduled formulations in the future, and should not assume that they will be able to take an ‘aggregate’ price increase after a certain number of years if they haven’t availed the option to increase the price every 12 months.
All medical devices that are manufactured in India or are imported into India have to either be licensed or registered by October 1, 2021. If a medical device is manufactured or imported after October 1, 2021 without registration or license, it will be deemed to have been manufactured or imported in violation of Indian law, thereby inviting penal action.
As a background, until 2020, the Indian Government regulated 37 categories of medical devices (scroll down for list) under the Drugs and Cosmetics Act, 1940 (DCA) and Medical Devices Rules, 2017 (MDR) for safety, quality and effectiveness. A license is presently required to manufacture or import these 37 categories of medical devices.
In 2020, the Indian Government brought about a change in law to the effect that manufacturers and importers of all medical devices other than the 37 categories of medical devices have to obtain registration ‘voluntarily’ before October 1, 2021. Those manufacturers and importers who are unable to obtain registration before October 1, 2021 would have to either stop business of said medical devices till they obtain the requisite registration, or risk facing penal consequences of violating DCA and MDR.
With an intent to help and support medical devices companies who wish to obtain a registration, we have put together a list of frequently asked questions (FAQs) with our responses in this article.
Please note that these FAQs are based on our understanding of the law, and under no circumstances should they be regarded as legal or professional advice or an endorsement of any industry practice.
What is this new requirement for obtaining registration for medical devices and equipment?
Owing to an amendment to Medical Devices Rules, 2017 in February of 2020 (said amendment hereinafter referred to as “Medica Devices (Amendment) Rules, 2020” or “MDR 2020”), manufacturers and importers of all medical devices and equipment (with the exception of those that have been notified by the government) in India are required to register their medical devices in India before October 1, 2021.
The list of devices notified by the government, to which the requirement of registration does not apply, is reproduced at the end of these FAQs.
Is the registration requirement voluntary or mandatory?
As per MDR 2020, the enforcement of registration requirementis to begin from October 1, 2021. The government has given time to the medical device industry to register ‘voluntarily’ by October 1, 2021. After that, manufacturers and importers will have to ‘mandatorily’ register their medical devices and equipment in order to be able to manufacture in India or import medical devices into India.
How to obtain registration?
In order to obtain registration, the manufacturer or importer of a medical device or equipment has to register itself, its medical device or equipment as well as the manufacturing site with the Central Drugs Standards Control Organization (CDSCO).
The registration is successful once the file number is generated.
What is the objective behind registration requirement?
The Indian government’s objective behind imposing registration requirement appears to be phase-wise regulation of all medical devices.
The pre-requisite for obtaining registration is just the existence of a ISO 13485 certificate (quality management system for medical devices) issued by a certification body accredited with National Accreditation Board for Certification Bodies (NABCB) or International Accreditation Forum (IAF) to the manufacturer of medical devices. No safety or effectiveness data is required to be submitted for obtaining registration. The intent of the Indian Government appears to be to ensure that by October 1, 2021, all medical devices sold in India must be manufactured at a facility whose quality management systems meet the standards specified in the ISO 13485, as certified by an accredited certifying body.
Is there a list of medical devices available to which the registration requirement is applicable?
CDSCO has published a draft list of medical devices that may require registration. However, since this is only a draft list, there may be medical devices which are not part of the list but would still be subject to registration requirement.
In order to evaluate whether a product qualifies as medical device or not (and consequently would be subject to registration requirement or not), one may refer to the following definition of medical devices under MDR:
All devices including an instrument, apparatus, appliance, implant, material or other article, whether used alone or in combination, including a software or an accessory, intended by its manufacturer to be used specially for human beings or animals which does not achieve the primary intended action in or on human body or animals by any pharmacological or immunological or metabolic means, but which may assist in its intended function by such means for one or more of the specific purposes of ―
(i) diagnosis, prevention, monitoring, treatment or alleviation of any disease or disorder;
(ii) diagnosis, monitoring, treatment, alleviation or assistance for, any injury or disability;
(iii) investigation, replacement or modification or support of the anatomy or of a physiological process;
(iv) supporting or sustaining life;
(v) disinfection of medical devices; and
(vi) control of conception
If a device or equipment is covered by the definition of above, and it is not part of the list of devices specifically notified by the government (see bottom of the article for list), then such a device or equipment will be subject to registration requirement in India.
In certain cases, it may be helpful to avail expert advice in evaluating whether a product or equipment qualifies as a medical device under Indian law and is covered by registration requirement or not.
Whether components and accessories of medical devices are required to be registered?
Component and accessories of medical devices would be subject to registration requirement only if they qualify as medical device as per the definition of medical device i.e. if they are intended by their manufacturer to be used for medical purposes.
As per a recent clarification issued by CDSCO, components and accessories of medical devices imported as a system need not be registered separately. However, it is unclear what ‘separately’ implies, and why such an exemption should be given only to imported systems. It is our view that all components and accessories should be registered as part of the system because the official form for registration has fields under which details of components and accessories may be provided. In case components and accessories are not registered as part of the system for some reason, they should be registered separately, as components and accessories are ‘medical devices’ in their own right as per the definition of medical device.
In other words, components and accessories of medical devices may be registered alongside the system or independently, as long as they qualify as ‘medical device’ as per the definition of medical device.
What are the consequences of not obtaining registration before October 1, 2021?
A device to which registration requirement applies cannot be legally manufactured or imported into India without registration after October 1, 2021. The manufacturers and importers of such medical devices would have to obtain a registration for such devices in India before they can market these devices.
If a device is manufactured or imported after October 1, 2021 into India for marketing purposes without registration, then it would invite penal action under The Drugs and Cosmetics Act, 1940.
Who can make the application for registration?
An importer or manufacturer of the medical device or equipment can make the application for registration.
Can an importer obtain registration for imported medical device or equipment without whole sale drug license?
In order to create an account on the CDSCO’s registration portal as an importer, it is a pre-requisite to possess a whole sale drug license. However, for the time being, CDSCO is allowing registrations without a whole sale drug license as well.
What is the government fee payable for registration?
There is no government fee payable for registration.
What information is required to be provided for obtaining registration?
The following information has to be provided for obtaining registration:
Legal manufacturer’s name & address with Phone no., Fax & Email id,
Actual Site Details (Name, Address, Email ID, Fax No. & Contact No.)
Nature of activity (import/export)
Category of Device (medical device / IVD)
Generic Name, Model No.,
Intended Use,
Product Description,
Class of Medical Device
Medical Device Category
Grouping Category
Material of Construction,
Dimension (If any)
Shelf Life
Storage Condition,
Package Size,
Sterile or Non-Sterile,
Brand Name (If registered under the Trade Marks Act, 1999)
What are the documents required to be submitted obtain registration?
In addition to the information, the following documents are required to be submitted for registering a medical device: (1) an ISO 13485 certificate; (2) a Certificate to Foreign Government or Free Sale Certificate (for imported medical devices); and (3) an undertaking stating that the information and documents supplied are true and authentic are required to be submitted.
What is ISO 13485?
ISO 13485 is a standard for quality management system for designing and manufacturing a medical device.
Who issues ISO 13485 certificate?
ISO 13485 certificate is issued by a certifying body. For the purposes of registration, the ISO 13485 certificate must be issued by a certifying body accredited by National Accreditation Board for Certification Bodies in India or the International Accreditation Forum.
What is Free Sale Certificate or Certificate to Foreign Government?
A Free Sale Certificate or Certificate to Foreign Government is issued by a Regulatory Authority / Ministry of the country in which the medical device is approved and marketed. It serves as proof that the medical devices manufactured in the country as freely sold in that country (or region).
Is there a prescribed format for the undertaking to be submitted along with the application?
There is no prescribed format for the undertaking.
What are the compliances to be done after obtaining registration?
The registration number (file number) has to be declared on the label of the medical device.
How long does it take for the registration to be received once the application has been submitted?
After the application for registration is submitted, a file number is generated instantaneously. The generation of the file number concludes the process of registration.
What is the registration number?
The file registration number is the registration number.
Is the registration number different for different medical devices and equipment?
The registration number differs as per the manufacturing site. Different medical device and equipment manufactured at the same site will receive the same registration number. Same medical devices manufactured at different manufacturing sites will receive different registration numbers.
What happens if the applicant submits incorrect information?
Once incorrect information has been submitted, it can only be rectified by CDSCO. The CDSCO requires applicants to submit an undertaking at the time of submission of the application for registration that information contained in the application is true and accurate. Therefore, it is paramount that the information submitted as part of the registration application is true and accurate.
What is the penalty for submitting false information or documents?
The CDSCO may cancel full or part of the registration, effectively making it impossible to sell medical devices in question in India.
Is it possible to sell medical devices and equipment manufactured in India or imported into India before October 1, 2021 without registration?
Given past precedents in similar matters, it is likely that medical devices imported or manufactured before October 1, 2021 may be permitted to be sold in India without registration. However, no medical device imported or manufactured in India after October 1, 2021 may be sold in India if it is not registered and labelled with the registration number.
It will be easy for enforcement authorities to check whether a medical device or equipment has been manufactured or imported into India on or after October 1, 2021 because the Legal Metrology (Packaged Commodities) Regulations, 2011 require the all packaged commodities to contain either date of manufacture or date of import.
Is it possible to sell unregistered medical devices in India which have been manufactured or imported after October 1, 2021?
No. It will be violation of DCA and MDR if a manufacturer, importer or trader sells an unregistered medical device which is manufactured or imported into India on or after October 1, 2021.
In other words, the concerned manufacturer or importer will have to register its medical devices in order to manufacture or import medical devices after October 1, 2021 for sale in India. In such cases, the registration will no longer be “voluntary” but mandatory. The registration number will have to displayed on the label of such medical devices.
Will the process for obtaining registration change after October 1, 2021 when obtaining registration for medical devices and equipment is no longer voluntary?
It is our understanding that it will not change.
For how long is the registration valid?
The registration is valid until appropriate manufacturing or import license is obtained by the concerned manufacturer or importer for those devices.
Before August 11, 2022, importers, manufacturers, distributors, whole sellers and retailers of Class A (low-risk) and Class B (low-medium risk) medical devices will have to compulsorily obtain a license. Before August 11, 2023, importers and manufacturers, distributors, whole sellers and retailers of Class C (medium-high risk) and Class D (high risk) medical devices will have to compulsorily obtain a license. The CDSCO is in the process of undertaking risk classification of all medical devices.
List of medical devices that are not covered by registration requirement
The requirement to obtain registration does not apply to below categories of medical devices as these categories of medical devices are already regulated and require a license for manufacture, import, sale and distribution in India. In other words, if a manufacturer or importer has a license for manufacture or import of medical device, then registration requirement will not apply to such manufacturer or importer.
1. Disposable Hypodermic Syringes;
2. Disposable Hypodermic Needles;
3. Disposable Perfusion Sets;
4. Substances used for in vitro diagnosis including Blood Grouping Sera;
5. Cardiac Stents;
6. Drug Eluting Stents;
7. Catheters;
8. Intra Ocular Lenses;
9. I.V. Cannulae;
10. Bone Cements;
11. Heart Valves;
12. Scalp Vein Set;
13. Orthopedic Implants;
14. Internal Prosthetic Replacements;
15. Ablation Devices;
16. Ligatures, Sutures and Staplers;
17. Intra Uterine Devices (Cu-T)
18. Condoms;
19. Tubal Rings;
20. Surgical Dressings;
21. Umbilical tapes;
22. Blood/Blood Component Bags;
23. Organ Preservative Solution;
24. Nebulizer
25. Blood Pressure Monitoring Device
26. Glucometer
27. Digital Thermometer
28. All implantable medical devices Equipment
29. CT Scan Equipment
30. MRI Equipment
31. Defibrillators
32. PET Equipment
33. X-Ray Machine
34. Dialysis Machine
35. Bone marrow cell separator
36. Disinfectants and insecticide specified in Medical Devices Rules, 2017;
37. Ultrasound equipment (effective November 1, 2021)
The COVID-19 pandemic, coupled with legitimisation of telemedicine in March 2020, has propelled the popularity of telemedicine manifold, with telemedicine platforms at the forefront. A question that arises is what the liability of these platforms is for any mishaps or complaints that patients may have about the consultations that they have with doctors through these platforms. The general perception is that, as technology providers, the platforms are intermediaries and are exempt from liability for consultations that take place on the platform. However, it is not quite that straightforward.
Liability exposure
The principles of vicarious liability and intermediary liability, though derived from different laws, are closely linked and are both paramount factors for telemedicine platforms to take into consideration while structuring their business and governance policies. Both concepts define the liability of an entity – in this case the telemedicine platform – for the actions of another person. Vicarious liability arises when the platform had the right, ability or duty to control the activities of the violator i.e., the doctor. Intermediary liability, on the other hand, arises because the platform facilitates the violator’s actions, and would cover violations by both the doctors and patients who use the platform. The former is largely dealt with by the Consumer Protection Act, 2019, while intermediary liability is derived from the Information Technology Act, 2000.
Vicarious liability
A common misconception is that platforms cannot be held vicariously liable since they do not employ the doctors that consult on the platform and there is no master-servant relationship between them; in fact, several platforms are structured as marketplaces, where anyone (subject to their credentials) can list themselves on the platform and offer their services. Further, telemedicine platforms typically make it clear that they are merely facilitating the interactions, not rendering medical advice themselves, so there is no doctor-patient relationship between the platform and patient, and the platform cannot be held liable for any deficiencies in service or negligence by the doctor.
However, these arguments would likely not pass the muster. A parallel may be drawn to hospitals, which typically raise the same defences in cases of medical negligence.
In the case of Smt. Savita Garg vs. The Director, National Heart Institute, the Supreme Court observed that when a patient goes to a private hospital/clinic, he goes by the reputation of the hospital and with the hope that proper care will be taken by the hospital authorities. Since these hospitals charge a fee for the services rendered by them, they are duty bound to bestow the best care, and if the hospital fails to discharge their duties through their doctors being employed on job basis or employed on contract basis, it is the hospital which has to justify.
In Smt. Rekha Gupta v. Bombay Hospital Trust & Anr., the National Consumer Disputes Redressal Commission held that a hospital cannot escape liability by taking the defence that it only provided infrastructural facilities and support staff, and did not perform or recommend any treatment itself. The NCDRC pointed out that the bills for doctor’s consultations are raised by the hospital and they charge a commission before remitting the fee to the consultant.
In Dr. Krishna Mohan Bhattacharjee vs. Bombay Hospital Medical Research Centre, the National Consumer Disputes Redressal Commission further stated that the terms under which a hospital employs the doctors is immaterial insofar as the hospital’s liability towards a patient is concerned, and that the defence that there is no master-servant relationship between the hospital and doctor cannot be taken in cases of established negligence, and held that patients go and get themselves admitted in the hospital relying on the hospital to provide them the medical service for which they pay the necessary fee.
The same rationale that courts apply to hold hospitals vicariously liable would logically apply to telemedicine platforms as well, and it is thus unlikely that they would be eligible for a blanket exemption from liability for negligence or deficiencies in services offered through the platform by claiming that they are merely technology providers that do not play a role in the actual rendering of medical services.
That being said, there are safeguards that can be put in place to minimise the risk of prosecution. Courts have recognised that a hospital – and therefore, by extension, a telemedicine platform – can mitigate their liability by showing that they had undertaken due diligence and adopted appropriate measures to prevent negligence or deficiencies in service. For a telemedicine platform, this would mean verifying the credentials of all doctors or healthcare professionals listed on the platform, ensuring that the doctors are: sufficiently well-versed with the practicalities, legalities and limitations of telemedicine; are aware of the functionalities of the platform; are following proper documentation processes, are compliant with the platform’s policies, etc.
The platform would also have to follow measures to mitigate their direct liability for medical negligence, such as ensuring that only qualified professionals are listed, the data protection systems are secure and compliant with the law, the technology supports smooth consultations.
It is also important to keep in mind the quality of care to be expected (and hence the liability for falling short of the expectations) of a medical establishment is directly proportional to its reputation. Thus, for a platform that makes claims of (facilitating) quality consultations, it is especially important to have stringent quality control measures in place, especially as they grow.
Dilemma of quality management vs. “control”: A threat to intermediary status
Implementing quality control measures to mitigate risk is essential for telemedicine platforms to mitigate risk of being held vicariously liable for negligence and deficiencies in service on the platform. However, it also poses a challenge to telemedicine platforms – it could potentially weaken their position as an intermediary that can avail of safe harbour protections under the Information Technology Act.
It is important to understand that telemedicine platforms are a kind of e-commerce entity. An e-commerce entity may either be set up as an inventory or a marketplace entity. An inventory e-commerce entity “owns” i.e. exercises control over the service provider doctors, whereas a marketplace entity merely provides the technological infrastructure to facilitate consultations. In case of the latter, the entity could be considered an internet intermediary that can avail of safe harbour protections, which is why most telemedicine platforms are structured as “aggregators”.
Essentially, the law recognises that an intermediary does not control what third-parties do on the platform and they cannot reasonably be expected to monitor every single transaction. Thus, provided that the intermediary complies with certain requirements, they are exempted from liability for wrongdoings done by third-parties on the platform without their knowledge.
In order to be eligible for the protection, the intermediary must follow the due diligence requirements stipulated in the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, which include publishing and complying with a privacy policy and terms of service which specifies the types of content and activities that is prohibited on the website and/or mobile application, taking action against violators upon receiving knowledge of wrongdoings, cooperating with governmental authorities, etc, as well as certain compliances under the Consumer Protection (E-Commerce) Rules, 2020 such as executing an undertaking with service providers to ensure that the descriptions and other contents pertaining to the services offered through the platform is accurate.
Thus, the law envisages a fairly “hands-off” and reactive approach to managing third-parties on the platform, and adopting more prescriptive policies and quality control measures could be viewed as the platform exercising control over the service providers, which would threaten their position as an intermediary.
Add-on services: changing dimension of intermediary status.
Most telemedicine platforms nowadays also offer value added services such as algorithmic matching of doctors/healthcare providers and patients, facilitating payments, electronic health record management, etc.
As per Section 79 of the Information Technology Act, the exemption from liability would also apply only if the intermediary is merely a passive conduit of the information, and is not involved in the initiation of the transmission, selecting the receiver of the transmission, and does not modify the information. Questions have been raised as to whether the value-added services dilute their role as a passive conduit, and result in the platform playing an active role in the transaction, which would mean that they cannot avail of the protection.
In the case of Amazon Sellers Services Private Limited vs. Modicare Limited & Ors. the Delhi High Court recognised that the FDI Press Note 2 of 2018 allows marketplace e-commerce entities to offer value added services to businesses, and held that Section 79 does not appear to differentiate between active and passive intermediaries. When an intermediary provides services in addition to access, it must comply with the requirements of Section 79 i.e. must remain a passive conduit in relation to the information. So long as that is complied with, the intermediary may avail of the protection.
It is important to note that the Intermediary Guidelines recognises not only human editorial control, but also automatic and algorithmic control. This means that a platform would not be able to take the defence that any service which dilutes their position as a passive conduit is entirely algorithmic and hence does not amount to active involvement.
Key Takeaway
If a telemedicine platform was to lose its status as an intermediary and the protections conferred by the law, they would be required to proactively monitor everything that takes place on the platform, since they would be liable for any non-compliances or wrongdoings. For platforms dealing with large volumes of consultations, this would be logistically challenging, if not impossible. The cost of operations and litigations that would arise would make it an untenable business.
Thus, it is essential that telemedicine platforms closely evaluate their structure, policies, features and service offerings to strike a balance between ensuring that high quality services are offered through the platform, while still minimising their liability.
Manufacturing drones [also referred to as Unmanned Aircraft System (UAS) or Remotely Piloted Aircraft System (RPAS)] in India is regulated by multiple laws including: Aircraft Act, 1934, Indian Wireless Telegraphy Act, 1933, Indian Telegraph Act, 1885 and Sea Customs Act, 1878 (as adopted by the Customs Act, 1962).
In this article, we have described the procedure that has to be followed for lawfully manufacturing drones in India.
Step 1- Obtaining Unique Authorization Number (UAN) for Manufacturer
Persons seeking to manufacture a drone have to first obtain a Unique Authorization Number (UAN) from the DGCA under the Unmanned Aircraft System Rules, 2021 (UAS Rules). It is important to note that only Indian citizens, enterprises (firms, partnerships etc.) and companies may seek authorization to manufacture drones.
Prior to making an application for authorization, the manufacturer has to first obtain security clearance from the Ministry of Civil Aviation (MCA) in consultation with Ministry of Home Affairs (MHA). The security clearance application may be made on the government portal https://e-sahaj.gov.in.
Upon receiving the security clearance, the manufacturer will have to submit an application to the DGCA in Form UA – 1 of UAS Rules along with the specified fee. The fee varies for each category of drone.
After the process of authorization is complete, the DGCA will provide a UAN for an authorized manufacturer. This UAN will be valid for a period of 10 years unless suspended, revoked or cancelled.
Any change thereafter to the credentials relevant to the eligibility criteria for obtaining the UAN has to be informed to the DGCA, and a fresh authorization will be issued thereafter if the eligibility conditions continue to be fulfilled.
Step 2 – Obtaining Equipment Type Approval for wireless system used in the Drone
An Equipment Type Approval (ETA) from the Wireless Planning & Coordination (WPC) Wing has to be obtained for every model and make of drone that is sought to be manufactured in India.
ETA can be obtained by making an application in the specified format to a Regional Licensing Officer (RLO) of the WPC Wing. The RLOs are located in Delhi, Mumbai, Kolkata, Chennai and Guwahati. An application form along with the technical literature, radio frequency reports from accredited labs and the requisite fees have to be submitted while applying for ETA.
An ETA issued for particular make and model of a prototype drone can be used by future users of the same make and model.
Step 3 – Obtaining Unique Prototype Identification Number
Any drone which has not been granted a Certificate Manufacture and Airworthiness (CMA) by DGCA cannot be used for sale and marketing purposes. In order to obtain a CMA, first a prototype of the drone has to be manufactured in India for testing at an approved laboratory.
In order to manufacture a prototype drone in India, the authorized manufacturer has to make an application for obtaining a Unique Prototype Identification Number, which is unique to the particular prototype drone and references the serial number. The application to obtain the Unique Prototype Identification Number has to be made as per Form UA – 2 of UAS Rules along with the specified fee.
The Unique Prototype Identification Number received from DCGA has to be affixed on the Prototype drone in an identifiable and visible manner.
Step 4 – Manufacturing a Prototype UAS
An authorized manufacturer can manufacture a prototype drone after obtaining the Unique Prototype Identification Number. The prototype drone is essential for the receiving the CMA.
Step 5 – Obtaining Certificate of Manufacture and Airworthiness (CMA)
Once the prototype drone has been manufactured in India, the authorized manufacturer is required to prove that the prototype drone is ‘airworthy’ i.e. it is capable of airborne operations as per the requirements stipulated by Indian law. A drone is considered to be airworthy only when it receives a Certificate of Manufacture and Airworthiness (CMA) from DGCA.
An authorized manufacturer can obtain a CMA by making an application under Form UA – 3 of UAS Rules to the DGCA with the specified fee. Please note that unmanned aircraft flight manual and maintenance manual should also be prepared and submitted along with Form UA – 3. On receipt of duly filled application, the DGCA allots an approved laboratory for testing of drones. Upon allotment, the authorized manufacturer has to submit the prototype drone which was manufactured in India along with design documents to the testing laboratory. The testing laboratory will test the prototype drone for its design, build and airworthiness. Once the testing laboratory validates the prototype drone and issues a test report, the DGCA will issue a CMA for specific type and class of a drone after being satisfied with the test report.
A drone can be lawfully manufactured in India after ensuring that the requirements stipulated in the steps mentioned above are complied with.
Regulatory declarations usually do not receive the same importance as cosmetic product claims and design, but they are essential nonetheless and may invite liability if they are found to be missing from a product package.
The above statement may apply to cosmetics sold all around the word, but is especially true for cosmetics products sold in India because the Indian cosmetics regulator (the State Licensing Authority i.e. SLA for domestically manufactured cosmetics, and the Central Drugs Standards Control Organization i.e. CDSCO for imported cosmetics) does not approve labels at the time of granting marketing authorization (even though it is mandatory to submit a copy of the label at the time of application). It is up to the importers and manufactures of cosmetics products to ensure that mandatory declarations laid down under the Cosmetics Rules, 2020 (“Cosmetics Rules”) and other laws appear on the product’s label.
Omitting any of the compulsory declarations would render the product ‘misbranded’ under the Drugs and Cosmetics Act, 1940 and may have consequences for the manufacturer or importer, ranging from suspension or cancelation of manufacturing license or import registration to criminal prosecution. It may even have consequences for the whole sellers and retailers, as misbranded products are bound to be confiscated without compensation.
In this article, we have described mandatory labelling requirements for sale of cosmetics in India.
Understanding inner label and outer label
Typically, a cosmetic product would have labels on the container (“inner label”), an outer wrapper or box (“outer label”), and sometimes a leaflet containing instructions or additional information.
The Cosmetics Rules not only prescribe the declarations but also stipulate the label on which those declarations should appear.
As per the Cosmetics Rules the following declarations must appear on the label or labels specified. If the product has only a single label, all declarations must appear on that label.
Mandatory declarations for cosmetics manufactured in India under Cosmetics Rules, 2020
Inner and Outer labels
The following information needs to appear on label on the container as well as any external packaging.
Name of the cosmetic
Name of legal manufacturer
Complete address of the premises where the cosmetic has been manufactured
Use before date/date of expiry.
List of ingredients, present in concentration of more than one percent, shall be listed in the descending order of weight or volume at the time they are added, followed by those in concentration of less than or equal to one percent, in any order, and preceded by the words “INGREDIENTS”
Inner or Outer labels
The following information needs to appear on either the inner or outer label.
Distinctive batch/lot code* [preceded by “Batch No.”, “B. No”, “Batch”, “Lot No.” or “Lot”]
Manufacturing License Number* [preceded by “M”, “M.L. No.”, or “Mfg. Lic. No.”]
It is advisable to include the license number and batch code on the both outer and inner label, as most regulatory authorities check the external label for compliance, but most consumers discard the secondary package upon unboxing.
Only on Outer label:
The following information only needs to appear on the outer label:
Net contents (weight for solids, fluid measure for liquids, and either for semi-solids)*
Number of items, if more than one
Only on Inner Label(s):
If there are any hazards linked to a cosmetic, the following should appear:
Adequate directions for use
Any warning, caution or special directions
Names and quantities of ingredients that are hazardous or poisonous
If not, only the declarations that need to appear on both the inner and outer label must be mentioned on the container.
Mandatory declarations for cosmetics imported into India under Cosmetics Rules, 2020
The Cosmetics Rules stipulate the labelling requirements for all products that are sold in the Indian market, which includes imported cosmetics. All the information that must appear on the domestically produced cosmetics must also appear on imported cosmetics (except to the extent mentioned below). In addition, details of the importer must also be mentioned, so that consumers and the regulators have access to a domestic entity in relation to the imported products. Note that the modifications to the labelling may be effected at a customs bonded warehouse i.e. before clearing Indian customs before after importing into India.
The following additional declarations must appear:
Import registration certificate number [preceded by “RC”, “RC No.”, “Reg. Cert. No.”]
Name of importer
Address of importer
If the importer does not wisht to declare the manufacturing site, –then a declaration of country of manufacture as would suffice [“Made in (Country)”].
If the cosmetic is imported from a country that does not require that the manufacturing license number be mentioned, manufacturing license number need not be mentioned.
Exemptions for small-size cosmetic packages under Cosmetics Rules, 2020:
Small containers of cosmetics are subject to certain relaxations.
Address of manufacturer may be shortened to only principal place of manufacture and the pin code where the cosmetic’s container is less than or equal to 60 ml of liquid and 30g of solids and semi-solids.
Batch code need not be mentioned on any cosmetic that are up to 10 grams if in the solid or semi-solid state or 25 ml if in the liquid state.
The declaration of net contents need not appear in case of a package of perfume, toilet water or the like, the net content of which does not exceed 60 ml or any package of solid or semi-solid cosmetic the net content of which does not exceed 30 grams
The list of ingredients need not appear for cosmetics that are less than or equal to 60 ml of liquid and 30g of solids and semi-solids.
These relaxations have likely been granted to ensure that the vital declarations are still present and readable, while avoiding unnecessary packaging and inserts.
Requirements for Hair Dyes containing dyes, colours and pigments under Cosmetics Rules, 2020:
Hair dyes must contain additional declarations due to their strong chemical composition, and the likelihood of reactions occurring.
The following statements must appear on both the inner and outer labels in English and in local languages:
“Caution.﹘ This product contains ingredients which may cause skin irritation in certain cases and so a preliminary test according to the accompanying directions should first be made. This product should not be used for dyeing the eyelashes or eyebrows; as such a use may cause blindness.”
“This preparation may cause serious inflammation of the skin in some cases and so a preliminary test should always be carried out to determine whether or not special sensitivity exists. To make the test, cleanse a small area of skin behind the ear or upon the inner surface of the forearm, using either soap and water or alcohol. Apply a small quantity of the hair dye as prepared for use to the area and allow it to dry. After twenty-four hours, wash the area gently with soap and water. If no irritation or inflammation is apparent, it may be assumed that no hypersensitivity to the dye exists. The test should, however, be carried out before each and every application. This preparation should on no account be used for dyeing eyebrows or eyelashes as severe inflammation of the eye or even blindness may result.”
Cosmetics that are subject to any Bureau of Indian Standards (BIS):
The Ninth Schedule to the Cosmetics Rules specifies the BIS Standards that are applicable to a total of 37 categories of cosmetics including skin powders, skin creams, hair oils, shampoos, soaps, lipsticks, foundations, etc. Further, if any new BIS standards are introduced for cosmetics, those would become mandatory after six months from the date of publication.
If any of the standards specify labelling requirements, they must mandatorily be complied with. This requirement applies to both domestically manufactured and imported cosmetics.
Animal Testing Declaration
While most products do include a statement or symbol to signify that the cosmetic product was not tested on animals, the Cosmetics Rules do not require that the declaration be made since animal testing has been outrightly banned for cosmetic products. Should the brand choose to include the declaration, however, care should be taken that they do not use any of the symbols associated with certifications such as the PETA’s ‘Beauty without Bunnies’ or the Cruelty-Free International’s ‘Leaping Bunny’ unless the certification has actually been obtained.
Mandatory declarations for cosmetics imported or manufactured into India under Legal Metrology (Packaged Commodities) Rules, 2011
In addition to the Cosmetics Rules, the label must also contain the declarations required under the Legal Metrology (Packaged Commodities) Rules, 2011 (“Packaged Commodity Rules”).
The additional declarations that would be required are:
Generic name of the product
Maximum retail price
Contact details for customer care
Date of import, if applicable
Alteration of Mandatory Declaration on Cosmetics Product Labels:
Caution should be taken while finalising the labels for a cosmetic product, since making any modifications to the label once the product leaves the manufacturing factory premise (in case of manufactured cosmetics) or the Indian customs (in case of imported cosmetics), would require prior approval from the office of Drugs Controller General of India (India), who heads the CDSCO, and, if the modification relates to a mandatory declaration under the Packaged Commodity Rules, the authority thereunder as well.
The import of drones [also referred to as Unmanned Aircraft System (UAS) or Remotely Piloted Aircraft System (RPAS)] into India is governed by multiple laws, including: Aircraft Act, 1934, Indian Wireless Telegraphy Act, 1933, Indian Telegraph Act, 1885, Sea Customs Act, 1878 (as adopted by the Customs Act, 1962), and the Foreign Trade (Development and Regulation) Act, 1992.
The key permission required to secure an import clearance for a drone is the Certificate of Manufacture and Airworthiness from Director General of Civil Aviation (DGCA). However, there are many steps involved in the process of obtaining the said certificate.
In this article, we have described the procedure that has to be adopted before importing drones into India in a step-by-step manner.
Step 1- Obtaining Unique Authorization Number (UAN) for Importer
Persons seeking to import a drone have to first obtain a unique authorization number from the DGCA under the Unmanned Aircraft System Rules, 2021 (UAS Rules). It is important to note that only Indian citizens, enterprises (firms, partnerships etc.) and companies may seek authorization to import drones.
Prior to making an application for authorization, the importer first has to obtain security clearance from the Ministry of Civil Aviation (MCA) in consultation with Ministry of Home Affairs (MHA). The security clearance application may be made on the government portal https://e-sahaj.gov.in.
Upon receiving the security clearance, the importer will have to submit an application to the DGCA in Form UA – 1 of UAS Rules along with the specified fee. The fee varies for each category of drone.
After the process of authorization is complete, the DGCA will provide a Unique Authorization Number (UAN) for an authorized importer. This UAN will be valid for a period of 10 years unless suspended, revoked or cancelled.
Any change thereafter to the credentials relevant to the eligibility criteria for obtaining the UAN has to be informed to the DGCA, and a fresh authorization will be issued thereafter if the eligibility conditions continue to be fulfilled.
Step 2 – Obtaining Equipment Type Approval for wireless system used in the Drone
An Equipment Type Approval (ETA) from the Wireless Planning & Coordination (WPC) Wing has to be obtained for every model and make of drone that is sought to be imported into India.
ETA can be obtained by making an application in the specified format to a Regional Licensing Officer (RLO) of the WPC Wing. The RLOs are located in Delhi, Mumbai, Kolkata, Chennai and Guwahati. An application form along with the technical literature, radio frequency reports from accredited labs and the requisite fees have to be submitted while applying for ETA.
An ETA issued for particular make and model of a prototype drone can be used by future users of the same make and model.
Step 3 – Obtaining Unique Prototype Identification Number
Only a drone which has been granted a Certificate Manufacture and Airworthiness (CMA) by DGCA may be imported into India for sale and marketing. In order to obtain a CMA, first a prototype of the drone has to be imported into India for testing at an approved laboratory.
In order to import a prototype drone into India, the authorized importer has to make an application for obtaining a Unique Prototype Identification Number, which is unique to the particular prototype drone and references the serial number. The application to obtain the Unique Prototype Identification Number has to be made as per Form UA – 2 of UAS Rules along with the specified fee.
The Unique Prototype Identification Number received from DCGA has to be affixed on the Prototype drone in an identifiable and visible manner.
Step 4 – Obtaining Import Clearance for Import of Prototype UAS
Once the Unique Prototype Identification Number has been obtained, the next step is to make an application for prototype import clearance from DGCA. For seeking import clearance, an authorized importer has to make an application in Form UA – 6 along with the specified fee to the DGCA. Once the import clearance is received, the authorized importer may import the drone after obtaining import authorization from Director General of Foreign Trade (DGFT).
Step 5 – Obtaining IEC and Restricted Imports Authorization for Prototype UAS from DGFT
As per the Foreign Trade Policy, 2015 – 20 (FTP), notified under the Foreign Trade (Development and Regulation) Act, 1992, every person or entity who wishes to import any article into India for commercial purposes is required to obtain an Import – Export Code (IEC) from DGFT.
Furthermore, as per the FTP, articles whose import is ‘restricted’ under the Export and Import (EXIM) policy of India would also require an import authorization from Directorate General of Foreign Trade (DGFT) prior to import into India. The import of drones is restricted under India’s EXIM Policy (with the exception of nano drones). Therefore, import of a prototype drone will also require prior import authorization from DGFT.
An authorized importer can apply for restricted imports authorization on the government portal: https://www.dgft.gov.in/CP/
Step 6 – Obtaining Certificate of Manufacture and Airworthiness (CMA)
Once the prototype drone has been imported into India, the authorized importer is required to prove that the prototype drone is ‘airworthy’ i.e. it is capable of airborne operations as per the requirements stipulated by Indian law. A drone is considered to be airworthy only when it receives a Certificate of Manufacture and Airworthiness (CMA) from DGCA.
An authorized importer can obtain a CMA by making an application under Form UA – 3 of UAS Rules to the DGCA with the specified fee. Please note that unmanned aircraft flight manual and maintenance manual should also be prepared and submitted along with Form UA – 3. On receipt of duly filled application, the DGCA allots an approved laboratory for testing of drones. Upon allotment, the authorized importer has to submit the prototype drone which was imported into India along with design documents to the testing laboratory. The testing laboratory will test the prototype drone for its design, build and airworthiness. Once the testing laboratory validates the prototype drone and issues a test report, the DGCA will issue a CMA for specific type and class of a drone after being satisfied with the test report.
Step 7 – Obtaining Import Clearance for Compliant UAS
Once DGCA issues a CMA for a specific type and class of the drone, the authorized importer is required to make an application for its import clearance. Unlike import clearance for prototype, an import clearance of a compliant drone (i.e. a drone which has received a CMA) will allow the authorized importer to import drones in large quantity and for the purpose of sale and marketing in India. For obtaining import clearance for compliant drone, an application in Form UA – 7 of UAS Rules has to be made to DGCA with the specified fee.
Components or parts of drones which are intended to be imported also have to be approved by the DGCA in advance. An application in Form UA – 8 has to be made to seek import clearance of parts and components. The necessary documents to be submitted will vary depending on the purpose of import. For manufacturing purposes, the applicant needs to submit the manufacturer authorization and CMA. If the purpose of import is for R&D purposes, the R&D authorization and Unique Prototype Identification Number will have to be submitted. If the components or parts are being imported for maintenance, the owner’s authorization and CMA have to be submitted by the applicant.
Step 8 –Obtaining Restricted Imports Authorization for Complaint UAS from DGFT
Note that the restricted imports authorization obtained from the DGFT for prototype drone will not work for compliant drones. Therefore, a fresh restricted import authorization will have to obtained for compliant drones. Please refer to Step 5 in terms of applying for restricted imports authorization in context of importing Compliant UAS.
Exemption for Nano Drone
As of May 2021, Steps 5 and 8, insofar as they relate to obtaining restricted import authorization from DGFT, are not applicable for nano drones i.e. drones which are up to 250 grams in weight, with maximum speed up to 15 meters/second, having maximum attainable height up to 15 meters and range limited to 100 meters from remote pilot, which do not fly beyond visual line of sight and cannot carry a payload. However, this exemption may be revised or removed by DGFT in near future.
Once the requirements stipulated under Step 1 to Step 8 are in place, a drone may be lawfully imported into India.
In India, the use of cannabis and cannabis leaves in medicines has caught public imagination. Contrary to popular perception, the use and consumption of cannabis and cannabis leaves is not entirely prohibited in India. It is permitted for medical and scientific purposes, subject to compliance with applicable laws. In this article, we have discussed the legality of use of cannabis leaves in pharmaceutical and ayurvedic medicines.
What are the laws that regulate use of cannabis leaves in medicines in India?
There are two sets of laws that regulate the use of cannabis leaves in medicines – The first set of laws treat cannabis leaves as a potential narcotic drug, and the second set of laws treat cannabis leaves as an intoxicant and a taxable item, i.e. as a source of revenue for the Government.
Narcotic drugs
The Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act) regulates the use of narcotic drugs in medicines India. In context of cannabis, it identifies three things as narcotic drugs: 1. The cannabis plant as a whole, including its parts such as leaves; 2. Cannabis, i.e. the flowering or fruiting top of cannabis plant when separated or not from the cannabis plant; and 3. Resin of the cannabis plant, when separated from the cannabis plant (popularly known as Charas or Hashish).
The NDPS Act treats cannabis leaves as ‘narcotic drug’ only when: 1. They are attached to the cannabis plant; 2. When they are separated from the cannabis plant but are not separated from its flowering or fruiting tops; and 3. If they contain resin from the cannabis plant.
So, leaves of cannabis plant are not regulated as narcotic drugs in India under the NDPS Act. They are regulated as narcotic drug only when they are associated with a narcotic drug, i.e. when they are attached to the cannabis plant or its flowering or fruiting tops or when they contain resin from the cannabis plant. This legal position has been upheld by Indian courts and accepted by the Indian Government.
Intoxicant
Each State in India has an excise law, for example, the Madhya Pradesh Excise Act, 1915. These laws are also sometimes referred to as prohibition laws, for example, the Maharashtra Prohibition Act, 1949. The purpose of these laws is to control access to intoxicants, and to give powers to the State Government to charge a duty on the manufacture and supply of intoxicants.
Almost all state laws in India identify cannabis leaves as an intoxicant, like they identify alcohol as an intoxicant. This means that cannabis leaves cannot be produced (i.e. separated from the cannabis plant) or used for commercial purposes without a license. For example, if a manufacturer of medicine wishes to use cannabis leaves in its medicines, it ought to have an appropriate license to procure cannabis leaves and to use it for medicinal purposes. Needless to say, the manufacturer will also have to pay a ‘duty’ (or tax) for procurement of cannabis leaves.
Why is the use of cannabis leaves more prevalent in ayurvedic medicines than in pharmaceutical medicines?
The marketing of medicines in India is regulated by Drugs and Cosmetics Act, 1940 (DCA). At present, there is no pharmaceutical medicine containing cannabis or cannabis leaf (or cannabinoids) that is approved under DCA for sale in India. If any pharmaceutical manufacturer were to introduce a cannabis or cannabis leaf based medicine in India, it would have to first undertake clinical trial of such medicine and establish its safety and efficacy. Undertaking clinical trials is an expensive and time-consuming process. To add to that, cannabis is hardly cultivated officially in India. So, it is difficult to procure standard quality cannabis or cannabis leaf that may be required in the manufacture of pharmaceuticals containing cannabis or cannabis leaf or their extracts.
However, Ayurveda as a branch of medicine explicitly recognizes use of cannabis and cannabis leaves in manufacture of ayurvedic medicines. This means that if a standard ayurvedic medicine is to be manufactured which contains cannabis or cannabis leaves, then no clinical trials have to be undertaken prior to its commercial launch. This makes ayurvedic system of medicines an obvious choice to manufacture and sell cannabis and cannabis based medicines.
Why manufacturers choose to use cannabis leaves over cannabis in ayurvedic medicines?
There are chemicals in cannabis that have medical properties. These chemicals are commonly referred to as cannabinoids. Of the many cannabinoids, cannabidiol (CBD) and tetrahydrocannabinol (THC) are the most sought after for their medicinal properties.
Both CBD and THC are found in significant quantity in the flower and the bud of the cannabis plant. Their percentage in leaves of the cannabis plant is relatively insignificant.
However, the use of cannabis leaves in medicines is preferable to cannabis in general. There are two reasons for it. First, it is relatively easy to procure cannabis leaves as they are not regulated as ‘narcotic drugs’. Second, cannabis leaf-based medicines do not require license to sell in each state under the NDPS Act as cannabis-based medicines do.
Are there any specific labelling declarations that are applicable to manufacturers of ayurvedic medicines made out of cannabis leaves?
Manufacturers of ayurvedic medicines containing cannabis leaves or extracts must put the following declaration “Caution: to be used taken medical supervision” in English and Hindi on the label of the medicine, if the medicine is for internal use. As per an advisory issued by Ministry of AYUSH, these medicines should be sold under a prescription of a registered medical practitioner. They are not required to be labelled as “NRx”, however, since these medicines are not narcotic drugs.
What is the limitations of use of cannabis leaves in ayurvedic medicines?
The manufacturers of ayurvedic medicines containing cannabis leaves or its extracts must be careful to not use resin that may be deposited on the leaves of the cannabis plant for preparation of medicines. The resin found on any part of the cannabis plant (including leaves) is considered narcotic, and its use in ayurvedic medicine will make the ayurvedic medicine a narcotic drug, which in-turn will invite several additional compliances such as manufacturing quota, mandatory sale license and record-keeping.
The manufacturers should also be careful to not disturb the natural balance of cannabinoids as found in leaves of cannabis plant, while using cannabis leaves or its extract in the medicine. One of the cannabinoids, THC, is known for its psychoactive properties and is regulated as a psychotropic substance under NDPS Act. If the cannabis leaves are used specifically to extract THC out of cannabis leaves for subsequent use in ayurvedic medicines, then there is a risk that the ayurvedic medicine may be regulated as a psychotropic substance under NDPS Act, thereby inviting additional compliances.
On July 20th, 2020, the new Consumer Protection Act, 2019 came into force in India, replacing the previous enactment of 1986. The new Act overhauls the administration and settlement of consumer disputes in India. It provides for strict penalties, including jail terms for adulteration and for misleading advertisements. More importantly, it now prescribes rules for the sale of goods through e-commerce. The consumer is now truly the king!
Here are some of the highlights:
An aggrieved consumer can file complaints about a defect in goods or deficiency in services from where she lives, instead of the place of business or residence of the seller or service provider. The new law provides for e-filing of consumer complaint as well.
No fees are required to be paid if the claim is within Rupees 5 lakhs (approximately 3500 USD).
A consumer can conduct her own case via video conferencing. Engaging a lawyer is optional.
A concept of product liability has been introduced by the new law, thereby allowing aggrieved consumers to claim significant compensation as a relief due to the negligence of the manufacturer or service provider.
A group of aggrieved consumers can join hands and file a class action suit (like in the US) to reduce costs and improve chances of redressal or settlement.
Producers of spurious goods may be punished with imprisonment.
Misleading advertisements may be punished with imprisonment. Celebrities endorsing a product may not be punished but can be barred from endorsing if the advertisement is misleading.
E-commerce is now tightly regulated, and e-commerce companies are now expected to disclose all relevant product information, including country of origin, and respond to the grievance of consumers withing prescribed timelines.
Settlement of consumer disputes through mediation i.e. with the help of a neutral intermediary outside the consumer court is encouraged under the new law, thus saving time and resources of disputing parties which would otherwise have been spent on dispute resolution through a formal mechanism.
Consumers now have several protected rights, including the right to safety, information, choice, redressal as well as right to be heard, to be educated as a consumer, and to a mediated settlement.
Corporates entities that cater to consumers will have to exercise greater care and caution in terms of quality, quantity, and product safety. The boards of corporates that manufacture or trade consumer goods must create a Consumer Affairs Committee to periodically review consumer complaints and address the need to proactively offer mediated settlements by holding online mediation and save themselves the expenses of defending a matter in Consumer Courts, in some remote part of India besides incurring the collateral damage to reputation.
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