Policy Wrap: Meta threatens to stop publishing news content in California, Russia hands WhatsApp fine for not removing banned content, EU-US to prepare voluntary AI code of conduct, and more

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Meta threatens to stop publishing news content in California over proposed legislation

Facebook's parent company Meta Platforms announced on Wednesday that it will stop publishing news in California if the state implemented legislation requiring digital corporations to compensate publishers.

Aiming to reverse a loss in the local news industry, the proposed California Journalism Preservation Act (CJPA) would compel "online platforms" with at least 50 million monthly active users to pay a "journalism usage fee" based on their ad revenue to news providers whose work appears on their services. According to this proposed regulation, at least 70% of the advertising sales cut given to qualified publishers must go towards paying journalists and support personnel.

Along with Alphabet's Google, which has declared it will delete links to news stories from Canadian search results, the corporation is also threatening to stop publishing news in Canada in response to legislation that has been proposed there.

The proposed act is comparable to a groundbreaking law that Australia approved in 2021, which also sparked threats to limit service from Facebook and Google. Google temporarily stopped providing news links to Australian readers, before giving up and even agreeing to pay Australian publishers for republishing their articles. This could very well act as a precedence for similar outcomes in Canada, and the US.

Russia hands WhatsApp its first fine for not removing banned content

A Russian court on Thursday imposed WhatsApp's first penalties in Russia for failing to remove prohibited content amounting to 3 million roubles or approximately $37,080.

Despite the fact that the parent firm of WhatsApp, Meta Platforms Inc, was previously delisted as an "extremist" organisation in Russia, the widely used chat programme has never been penalised for failing to delete illegal content.

Other Meta services, including Twitter and Alphabet's Google, as well as the now-banned Facebook and Instagram, have also received fines for their content.

However, WhatsApp has already been penalised for allegedly refusing to abide by Russian data protection laws and keep the information of Russian users on Russian servers.

Russia and Big Tech have been at odds for years over content, censorship, data, and local representation in legal proceedings.

EU, US to prepare voluntary AI code of conduct “within weeks”

According to statements made on Wednesday by the European Union and the United States, a voluntary code of conduct on artificial intelligence will be drafted "within weeks" in the hopes that other democracies will join.

The Western partners felt a "fierce urgency" after discussions with EU officials in Sweden to act in response to the growth of the technology, in which China has been a growing force.

The time it takes for governments and institutions to figure out how to legalise or regulate new technology results in a gap nearly invariably, according to TUS Secretary of State Antony Blinken.

In a joint statement, the European Union and the United States argued that mitigating the threat of AI-related extinction should be a worldwide priority alongside other societal-scale hazards like pandemics and nuclear weapons.

G20 members discuss common framework to define startups, allocating a common fund for startups among other issues at the Startup20 Engagement Group meet

The G20 countries banded together to discuss the establishment of a global startup ecosystem for growth and innovation at the Startup20 Engagement Group conference in Goa. Important meetings and discussions were held throughout the gathering with the goal of enhancing cooperation and coordinating efforts to assist and help entrepreneurs grow globally.

The development and adoption of a definition framework for startups, the establishment of a network institution to support startups and ecosystem stakeholders across the G20 countries, the ease and diversification of access to capital, the easing of market regulations for startups, the prioritisation of including underrepresented communities in the startup ecosystem, and the scaling up of startups of global interest were a few of the key action points.

Dr. Chintan Vaishnav, who stressed on the importance of specific action points mentioned in the Policy Communiqué, proposed allocating a significant sum of $1 trillion for the startup ecosystem by 2030.

The foundation's goal is to develop a startup definition framework that can be used in multiple economies. The Engagement group had stated that the international startup ecosystems are uniting, cooperating, and becoming interoperable, and it becomes very evident that there are different definitions of startups in each of these countries, and the need more a common definition is becoming necessary.

ONDC to launch revamped incentive structure from June 1 in a bid to move away from discounting

The Open Network for Digital Commerce (ONDC) has redesigned its incentive system that goes into effect on Thursday in an effort to move away from discounting on the platform.

The maximum discount that can be given per order under the new scheme has been reduced from Rs 125 to Rs 100. Additionally, the discount would only be made available to users whose orders total more than Rs 300 for other products and Rs 200 for food orders.

According to a notice ONDC sent to network partners, the minimum order value to qualify for reductions includes delivery costs.

Incentives were offered to encourage platforms and clients to join ONDC and create more awareness about the platform. The goal right now is to grow organically. With numerous platforms operating on the same network, pricing will be handled by the level of competition.

Government reopens semiconductor incentive scheme, invites both new and current applications

According to the Ministry of Electronics and Information Technology (MeitY), the government has reopened the opportunity for applicants, both new and current, to reapply for the establishment of semiconductor and display fabrication facilities and to request incentives from the Centre under the India Semiconductor Mission (ISM).

The government had opened the submission period for bids to establish semiconductor and display fabrication operations in India on January 1, 2022. After February 15, they had then decided to no longer accept applications.

The government anticipates that the window's reopening will result in increased interest from processors, packaging companies, memory chip manufacturers, and companies that fabricate compound semiconductors.

The application window will open on June 1 and remain open until the government receives quality applications and the necessary resources are available.

UPI to account for 90% of retail digital payments by 2026-27, will result in over 1 billion transactions per day

According to a PwC India analysis titled "The Indian Payments Handbook - 2022-27," UPI transactions are expected to exceed 1 billion per day by 2026–2027, making up 90% of all retail digital payments in the nation. According to the paper, the Unified Payments Interface (UPI), which is leading the digital payments revolution, accounted for nearly 75% of all transaction volume in the retail sector in 2022–2023

According to the report, the Indian digital payments market expanded steadily at a CAGR of 50% (volume-wise) and is predicted to increase to 411 billion transactions in FY 2026–27 from 103 billion in FY 2022–23.

By FY2026–2027, it is predicted that UPI will record 1 billion transactions every day, going up from 83.71 billion in 2022–2023 to 379 billion in 2026–2027.

It added that, after UPI, cards (both debit and credit) payments are one of the most popular retail digital payment methods, and the credit card market in particular, is still expanding at a strong rate. By FY 2024–2025, credit card usage is anticipated to outpace debit card usage in terms of transaction volume.

The next phase of growth for the payments sector will be driven by areas like embedded and ecosystem finance, digital loans based on payment transactions, and offline payments. According to Mihir Gandhi, Partner and Payments Transformation Leader, PwC India, innovation and inclusiveness are paving the road for a smooth digital economy in the country's constantly changing payments landscape.

Investments from 21 nations exempted from angel tax

India waived the alleged "angel tax" on investments made by non-resident institutions such sovereign wealth funds and pension funds from 21 different nations.

According to a notification issued by the Central Board of Direct Taxes (CBDT) on Thursday, investments into closely held firms made through jurisdictions not mentioned in private equity and venture capital will be subject to scrutiny under the angel tax provisions.

Since the majority of the nation's foreign investment comes from jurisdictions not included on the list, tax experts predicted that this would limit the benefit of the exemption to a small group of investors.

The US leads the list of the 21 approved jurisdictions with 9.4% of the total share. The cumulative share of the 21 approved jurisdictions is 29.1%

The list omits nations like Mauritius, which has the highest share of foreign direct equity investment since April 2000 at 26%, followed by Singapore with 23%.

Angel tax-hit venture capital funds reach out to CBDT for relief

The Central Board of Direct Taxes (CBDT) has received requests from venture capital funds hit by the new angel tax provisions to ease the rules that do not exempt investment in unlisted firms from some of these destinations.

They are currently preparing to ask for either protective measures for money flowing in from significant investment centres that are not currently on the list of exempt jurisdictions, or an expansion of the list of nations from which corporations are eligible for tax exemption.

The impacted venture capital firms are preparing a white paper that will summarise their concerns and will be sent to the government.