Nepal govt's draft IT bill could stifle industry growth, say experts

A new Information Technology bill proposed by the Nepal government has alarmed rights groups and IT entrepreneurs, who say the draft legislation is not in line with the administration's message about the Himalayan nation being open for foreign investment and could also stifle innovation in the country's emerging IT sector, a media report said Thursday.

The bill, which aims at replacing the existing Electronic Transaction Act (ETA), has been touted by the K P Sharma Oli government as the most comprehensive and clear bill to address the long-held concerns around IT management.

However, the critics of the bill say the vague language used in the provisions could mean more red tape for internet-based companies, The Kathmandu Post reported.

"The government needs to at least communicate with IT entrepreneurs before introducing such a bill because we are the ones who will have to deal with the challenges of implementing the rules they enact," Bhojraj Bhatta, the Net Max Technologies managing director and the Internet Service Providers' Association of Nepal president, was quoted as saying by the Post.

There is also a clause in the proposed IT bill which states that Internet Service Providers (ISPs) will be penalised "if they do not remove any content deemed illegal by any public body or the court as soon as possible".

This was another reservation some of the stakeholders from the private sector had when they were consulted on the drafting of the bill a few months ago.

"The possibility of being confronted in a situation where multiple public bodies flood ISPs with requests to remove anything they deem illegal would overwhelm these companies in more ways than one. We don't want the responsibility of actively filtering content forced on us with the fear of punishment hanging over us," said Binay Bohra, the MD of Vianet Communications, another ISP company.

"That is not what technical service providers like us do...What kind of internet will the people get if the ISPs start taking down sites one after another to safeguard their business and because of the fear of government reprisal?" he questioned.

IT entrepreneurs are also worried about the provisions in the bill which requires them to seek permission from the government to bring equipment into the country.

They complained about the increasing red tape saying their businesses might be adversely impacted if the government bodies dealing with permission aren't efficient.

"There is already a lot of restrictions for online ventures and pushing for more controls, like having to take multiple permissions, will only add to the hurdle," said Subash Sharma, the CEO of F1 Soft International, one of the largest financial technology companies in Nepal.

"You can't expect innovation amidst such regulations in every step of the way," he added.

Meanwhile, government authorities have defended the bill saying they are only trying to regulate those who might be misusing internet-based platforms.