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Online Session - Business and Contracts: Pandemic Impact and Future!




3 pm - 4:30 pm


Google Meet

The Cochin Chamber of Commerce and Industry organised an Online Session on “Business and Contracts: Pandemic Impact and Future!” on Monday, 6th July 2020 on the Google Meet Platform.


Mr. Prashanth S. Shivadass, Advocate and Founder, Shivadass & Shivadass (Law Chambers) Bangalore and Ms. Jomol Joy, Advocate and Of-Counsel, Shivadass & Shivadass (Law Chambers) Bangalore were the Speakers at the meeting.


The President of the Chamber Mr. V Venugopal welcomed the participants to the virtual meeting.


Commencing the session Mr. Prashanth said that one of the major concerns which emerged out of the standstill position on account of Covid 19 is whether businesses will ever go back to 'normalcy' and whether parties will continue to perform their obligations as agreed under the contracts entered earlier. This situation, he said,  has led to several discussions around whether this pandemic will be treated as an 'Act of God' or 'Force Majeure' event, to excuse a party for non-performance of the contract or has frustrated the contract rendering it impossible or impractical to perform.  He said that in modern business practice, Force Majeure clauses are generally embodied in the form of contractual provisions, agreed upon between parties, to excuse non-performance of the contract in cases of events beyond their control - such as an Act of God, natural calamities, war, labour unrest, epidemics, pandemics, etc. If the words epidemic or pandemic are used in the Force Majeure clause, then in all likelihood, the Force Majeure clause is triggered under the contract with the declaration of COVID—19 as a pandemic.


Mr. Shivadass said that with an increase in e-commerce and online transactions, the number of contracts being executed electronically has seen exponential growth and the ongoing COVID -19 crisis will further increase the execution of contracts electronically. The test and validity of an e-contract in India still encompass the pre-requisites of a contract as enumerated in the Indian Contract Act, 1872. It is pertinent to note that without an adequate legal framework, the implementation of e-contracts over traditional contracts may create an atmosphere of entropy. Further, the introduction of Section 65B to the Indian Evidence Act, 1872, and the enactment of the Information Technology Act, 2000 have enlarged the recognition of e-contracts under the law, he added.


Mr. Shivadass then explained certain things that an Organization must follow... like fair information practice principles, reasonable data processing, maintaining data transparency, maintaining storage limitations with exceptions, maintaining the data quality, etc. He said that an Organization must have an internal grievance cell for data within an Organization and the Grievance Officer must ascertain the gravity of a complaint.


Speaking thereafter, Ms. Joy explained the data protection law and data privacy and said that extraterritoriality norms have been made stricter for processing and storage of personal and sensitive data under the Data Protection Bill. She said that the last resort for entities dealing with economic distress from business disruptions due to Covid is termination and also spoke about the termination rights under contracts in detail.


Ms. Joy listed out the areas where businesses should pay extra attention such as vetting of new suppliers, contracts with aggregators to be strengthened in light of e-commerce, evaluating key commercial contracts, checking the terms of existing contracts for protection, including force majure clauses, examining the termination conditions and procedures in the contract in case if you are considering terminating the agreement or think the other party might, etc.


Following this, there was a brief question and answer session wherein the Speakers clarified the issues raised by the participants.


The meeting concluded with the Deputy Secretary of the Chamber, Mr. Manu Varghese thanking everyone for having participated in the meeting.