COMMENTARY

Economic & Political Weekly EPW june 15, 2013 vol xlvIiI no 24
17
The Disclosure of Lobbying
Activities Bill, 2013
Bhargavi Zaveri
Bhargavi Zaveri (bzaveri@mail.law.harvard.
edu) is currently a visiting researcher at
Harvard Law School and pursuing research on
Indian investment policy and lawmaking and
the interface between legal professionals and
policymakers.
A private members bill has
recently been introduced in
Parliament to regulate political
lobbying, which it denes as an
integral part of democratic
functioning. This article analyses
the various aspects of this bill and
asks whether Indias political class
is willing to bite the bullet of
making lobbying a legitimate
political activity.
I
n a society where lobbying is almost
synonymous with bribery and where
lobbyists often creatively couch them-
selves as political aides, public relations
ofcers and advocates for policy change,
the Disclosure of Lobbying Acti vities
Bill, 2013 (DLA Bill/Bill) recently intro-
duced in the Lok Sabha
1
by a Member of
Parliament can perhaps be seen as
the rst ever acknowledgement by a
parliamentarian of Indias worst-kept
s ecret. This private members bill, in-
troduced in the wake of the Nira Radia
tapes scandal, and more recently, Wal-
marts regulatory disclosure to United
States autho rities of having engaged in
lobbying activities to secure enhanced
access to Indian markets, the bill in-
tends to procure transparency in the
context of lobbying activity undertaken
in India.
The DLA Bill is a signicant step, as for
the rst time in the history of Indian
lawmaking, a potential law recognises
that lobbying is an integral part of
democratic functioning.
2
Whilst it re-
mains to be seen whether or not the bill
will ever translate into a law, it implicitly
indicates lawmakers willingness to con-
sider a proposal for a law, which requires
them to shrug off years of denial of
the omnipresent relationship between
lobbying and lawmaking.
This article critically analyses the
DLA Bill, identies provisions thereof
which will have an impact on stake-
holders and highlights some conceptual
and some not-so-conceptual errors there-
in, which arouse suspicions about the
genuineness and sincerity underlying
its introduction.
Lobbyists Registration Authority
The DLA Bill requires the central govern-
ment to set up a central authority for
registration of lobbyists known as the
Lobbyists Registration Authority (LRA).
The bill, thus, deals with lobbying
activity as an activity to be reported and
disclosed from time to time. Interestingly,
the bill ghts shy of declaring that
lobbying activity is legal in India as long
as the requirements prescribed under the
bill have been complied with. Admittedly,
in light of the reporting provisions,
a provision which expressly declares
lobbying activity to be legal would be
redundant. However, given that lobby-
ing has been culturally and politically
tab ooed in India, it may be worthwhile
considering making an express provision
to this effect. The absence of such a pro-
vision is indicative of the political inhibi-
tions and hesitation involved in making
a declaration to this effect.
Prospective Scope
The DLA Bill requires every entity
(including individuals, companies and
all entities of any form whatsoever) that
intends to engage in lobbying activity to
register itself with the LRA. The bill,
therefore, is not meant to procure dis-
closure of those cases wherein lobbying
has already resulted in or otherwise had
an impact on enacted laws, policies or
executive orders. Thus, for instance, under
the bill as it presently stands, Walmart
will not require to report the lobbying
activity undertaken by it to the LRA as
the law does not apply retrospectively.
Presumably, this seems to be a safer ap-
proach as a retrospective disclosure of
such cases would only irreparably open
a Pandoras box, can have mammoth
consequences for past governments and
result in a complete breakdown of state
machinery. The DLA Bill may, therefore,
be interpreted as implicitly sending out a
signal that past instances of lobbying
are waived.
Covered Persons
The DLA Bill covers lobbying activities
intended to be undertaken by any entity,
whether by itself or on behalf of others. It,
therefore, covers independent lobbying
agencies, India Inc, trade unions, non-
prot groups as well as trade and busi-
ness associations such as the Federation
of Indian Chambers of Commerce and
Industry (FICCI), which presently regu-
larly represent their respective interests
before the government.
COMMENTARY
june 15, 2013 vol xlvIiI no 24 EPW Economic & Political Weekly
18
Further, the DLA Bill, if it does fructify
into a law, may translate into a double-
edged sword for legal and accountancy
professionals who often make represen-
tations before legislative and executive
committees for the benet of their clients.
As in countries where lobbying is legal
and therefore a service sector in itself,
such professionals could ofcially take
advantage of this public platform to
expand their practice areas. However, at
the same time, it would mean being sub-
jected to regulation in a practice area,
which was hitherto unregulated. Also, if
the bill progresses into a law, it would be
interesting to see whether the governing
bodies of such professions such as the
Bar Council of India and the Institute of
Chartered Accountants of India would
be amenable to allowing their members
to engage in lobbying practice.
Further, it is not clear whether foreign
lobbyists engaged by foreign corporates
to lobby in India (the typical Walmart
scenario) or foreign lobbyists engaged
by Indian corporates to lobby in India or
abroad would be covered under the
potential enactment.
Lobbying Activity
Predictably, the crux of the issue is the
denition of lobbying activity contai ned
in the DLA Bill. Concisely put, the expres-
sion lobbying activity has been dened
to mean the act of any communi cation
(oral, written or electronic) with a public
servant and payment to a public servant.
Such act and payment must be done or
made with the aim of inuencing a legis-
lative action (such as the introduction,
passing or defeat of a central or state bill
or any amendment thereto), an execu-
tive action (such as a government policy
or programme, awarding a licence, con-
tract, grant, permit or funds to any indi-
vidual or organisation, executive deci-
sions to transfer an asset or business
manufacturing public goods to a private
individual), or the nomination or promo-
tion of any person for a position in a
public ofce.
Lobbying activity, as envisaged under
the bill (as presently worded), includes
the act of paying a public servant with
the aim of inuencing a legislative, exe-
cutive action, etc. Inclusion of payment
to a public servant in the denition of
permissible lobbying activity is a gross
conceptual error that blurs the very
distinguishing line between legitimate
lobbying and illegitimate gratication to
a public servant. Now, one would imag-
ine that payment to a public servant has
been included in the denition of lobby-
ing to ensure disclosure of such pay-
ments to the LRA. However, such inclu-
sion may obviously lead to an argument
that so long as a payment made to a
public servant has been disclosed by a
lobbyist to the LRA, it is a legitimate
lobbying activity. Needless to add, this
would run foul of several Indian laws
including the Indian Penal Code and
the Prevention of Corruption Act, 1988
(POCA). Moreover, the DLA Bill contains
an overriding provision, which means
that the potential DLA Act overrides any
other law (including POCA) for the time
being in force.
Further, the DLA Bill excludes from its
purview certain types of communica-
tions with public servants. These com-
munications have been excluded on
the principle that they are either, by
their very nature, in the public domain
(such as communications made in public
media) or are in fullment of a legal obli-
gation (such as testimony given b efore
a g overnment constituted committee),
or are in response to a request by the
government for (a) a tender or (b) public
views on proposed laws and policies.
Whilst communications of the kind
mentioned in item (b) would typically
be in the public domain, it may be advis-
able, by way of abundant caution, to give
the benet of such exception only if the
concerned views communicated in res-
ponse to a government request are freely
available on a public forum.
Concept of Public Servant
The next contentious denition under
the DLA Bill is that of a public servant.
The DLA Bill imports the denition of a
public servant from POCA, a law intended
to prevent corruption amongst public of-
cials. Given the objective underlying the
POCA, the denition of a public servant
under POCA is intended to cover public
servants of any category whatsoever.
Inclusion of each and every public
servant of any category may result in
inefciencies as not every public serv-
ant is in a position to inuence legisla-
tive or executive action. For instance, a
public servant under POCA includes any
employee of a statutory corporation
such as, for example, the Life Insurance
Corporation (LIC) of India. Requiring a
EPW 5-Year CD-ROM 2004-08 on a Single Disk
The digital versions of Economic and Political Weekly for 2004, 2005, 2006, 2007 and 2008
are now available on a single disk. The CD-ROM contains the complete text of 261 issues
published from 2004 to 2008 and comes equipped with a powerful search, tools to help organise
research and utilities to make your browsing experience productive.The contents of the CD-ROM
are organised as in the print edition, with articles laid out in individual sections in each issue.
With its easy-to-use features, the CD-ROM will be a convenient resource for social scientists,
researchers and executives in government and non-government organisations, social and political
activists, students, corporate and public sector executives and journalists.
Price for 5 year CD-ROM (in INDIA)
Individuals - Rs 1500
Institutions - Rs 2500
To order the CD-ROM send a bank draft payable at Mumbai in favour of Economic and Political
Weekly. The CD can also be purchased on-line using a credit card through a secure payment
gateway at epw.in
Any queries please email: circulation@epw.in
Circulation Manager,
Economic and Political Weekly
320-321, A to Z Industrial Estate, Ganpatrao Kadam Marg, Lower Parel, Mumbai 400 013, India
COMMENTARY
Economic & Political Weekly EPW june 15, 2013 vol xlvIiI no 24
19
person to register with the LRA as a lob-
byist merely because he/she communi-
cated with an employee of LIC would be
meaningless as such employee may not
even be in a position to inuence any ac-
tion on behalf of LIC. Such overstate-
ment in the concept of a public servant
would not only defeat the legislative in-
tent of regulating genuine lobbying ac-
tivity, but also increase enforcement
costs and reduce the efciency of the en-
forcement machinery.
Further, a public servant under POCA
includes the judiciary, persons authorised
by a court of law to perform any duty in
connection with the administration of
justice (such as a court appointed liqui-
dator or receiver), an arbitrator to whom
any cause or matter has been referred for
decision by a court or public authority,
and election ofcers. Inclusion of judi-
cial, quasi-judicial and electoral ofcers
under the DLA Bill would have absurd re-
sults, inasmuch as it would imply that
engaging in lobbying activities with ju-
dicial and electoral members is legal, as
long as such lobbying activity is report-
ed to the LRA. Surely, this cannot be the
intention of the bill as this would be
against the fundamental doctrines of
j udicial independence and independence
of electoral bodies.
Accordingly, simply importing the
denition of a public servant from POCA
is a quick-x solution and the concept of a
public servant would require to be revi-
sed to include certain categories of public
servants who are in a position to inu-
ence law or policymaking at any level.
Moreover, the laws in India are largely the
creation of qualied bureaucrats work-
ing within the government machinery
and they must also be brought within
the purview of the DLA Bill, inasmuch as
these bureaucrats may themselves be
targeted for lobbying activity.
Reporting and Disclosure
The DLA Bill has fairly extensive disclo-
sure requirements. It requires an inde-
pendent lobbyist to disclose the names
of clients and persons who have a
d irect interest in the outcome of the
lobbying activity or have otherwise
funded or controlled the lobbying ac-
tivity. All lobbyists are also obligated
to d isclose the area or subject matter of
the lobbying activity, the names of em-
ployees who will lobby with public
servants, the particulars of the public
servants who will be lobbied with, the
purpose and outcome of lobbying and
the details of payments made by the
lobbyist to a public servant.
Signicantly, a public servant is also
required under the DLA Bill to disclose
information regarding payments recei-
ved by him/her in the course of any
lobbying activity conducted with him/
her. This provision again makes one
wonder whether the DLA Bill is inten-
ded to legalise such payments, and
whether disclosure of such payments
absolves the lobbyist or the public serv-
ant from any graft allegations. Espe-
cially so, since the DLA Bill makes no
provision for disgorgement of the pay-
ment so received by a pubic servant,
and the bill, if it translates into a law
in its present form, has an overriding
effect on all other extant laws as men-
tioned above.
Ultimately, the broader aim of trans-
parency is realised through the obliga-
tion imposed by the DLA Bill legislation
on the LRA to make public all informa-
tion submitted to it on a website to be
maintained by the LRA.
The LRA is the administrative author-
ity under the DLA Bill which empowers it
to conduct investigations against per-
sons it suspects of having engaged in
lobbying activity without being regis-
tered with it. However, unlike most
statutes that empower an investigating
authority created under them with pow-
ers of interrogation, search and seizure,
no such corresponding enabling powers
can be found in the DLA Bill.
Penalties
Finally, the DLA Bill criminalises failure
by a person intending to engage in
lobbying activity to register itself with
the LRA, and imposes a penalty of up
to Rs 50 lakh, an exceptionally high
amount, the likes of which can be rarely
found in the Indian legal regime. Fur-
ther, failure to submit accurate informa-
tion when asked to do so by the LRA
attracts suspension of registration as
a lobbyist and is punishable with
imprisonment up to ve years or a ne
which may extend to Rs 75 lakh, or
both. A fundamental technical error in
the legislation lies in the fact that whilst
the DLA Bill penalises submission of in-
accurate information, there is no corre-
sponding provision penalising the fail-
ure to le the information prescribed
under the bill.
Notwithstanding the pitfalls of the
bill, supporting the bill (not in its origi-
nal but a much more tightened and
improvised form) may be an effective
damage control measure for the scam-
struck ruling government. Having said
that, given its long-term impact on
business and political circles in India,
the DLA Bill is, itself, surely likely to be
the subject matter of much lobbying
(both for and against) and whether
the bill will ever progress into a law
or be put on the back-burner is any-
bodys guess.
To conclude, considering the tradi-
tional stigma attached to the subject
in India, the bill is a laudable though
half-hearted step in the right direction.
If, however, there is any sincerity in-
volved in pushing the bill through
Parliament, it requires substantial pol-
ishing and robustness, unless, of course,
the elected members simply want to
play to the easily appeasable audience
of the Indian populace.
Notes
1 The Disclosure of Lobbying Activities Bill, 2013
was introduced in Lok Sabha on 8 March 2013
by Kalikesh Narayan Singh Deo. The text of the
Bill can be found on http://164.100.24.219/
BillsTexts/LSBillTexts/asintroduced/4587ls.pdf
2 The following extract from the Statement of
Object and Reasons appended to the DLA Bill
is relevant:
lobbying provides an opportunity for indi-
viduals and organisations to voice their views
on government decisions that affect them
and hence, forms an integral part of democrat-
ic functioning.
available at
Delhi Magazine Distributors
Pvt Ltd
110, Bangla Sahib Marg
New Delhi 110 001
Ph: 41561062/63