Global Data Review recently reached out for comments on a recently announced collaboration between the Organisation of Eastern Caribbean States and Facebook. Under the initiative, the OECS will have access to Facebook’s Disaster Maps feature in the event of natural disasters.
The Jamaican Constitutional Court in a 3-judge panel decision recently struck down an entire statute. The act – the National Identification and Registration Act 2017 – was being implemented with a view to making registration in a national ID database mandatory.
The complainant in the case had argued that it breached his constitutional rights.
The case is made interesting as the Jamaican Constitution does not include an express broad-based right to privacy and, certainly not informational privacy. In striking down the act, the Court took a weaving path that required an assessment of the degree to which the Jamaican Constitution provided a basis for protecting the right to privacy, despite this.
The Constitutional Court, having reviewed prior case law from throughout the Commonwealth, concluded that given the necessity of the right to privacy as a precursor to the enjoyment of the other rights in the Jamaican Constitution, a general right to privacy must be read into the Jamaican Constitution.
The no-fluff definition of a regulatory sandbox? A temporary observatory where regulators try to figure out whether a new financial product/service is fish or foul.
Let’s flesh that out a bit.
Where an entity wishes to introduce an innovative financial product or service in Barbados, it may not be immediately clear which regulatory requirements should be complied with. Why? Financial services are regulated by two separate entities: the Central Bank and the FSC. Broadly speaking, the Central Bank regulates banking-type institutions whereas the FSC regulates all other financial service providers (think: insurance companies, credit unions, pension funds etc).
Applying to and being accepted in the Sandbox allows the applicants some well needed regulatory breathing space. In this period, applicants do not need to comply with and be licensed under the regimes of either the FSC or the Central Bank.
Regulatory Review Panel
For the duration of the applicant company’s time in the Sandbox, governance oversight will be provided by the Regulatory Review Panel (RRP). The RRP will be comprised of no less than 3 persons (there is no upper limit on the number of appointees to the RRP). The Director of Finance and Economic Affairs, the Central Bank and the FSC will be responsible for the appointments to the RRP.
The RRP, among many other governance functions, will determine whether the applicant’s product or service should be regulated pursuant to the FSC’s regime or the Central Bank’s. Alternately, the RRP may conclude that the particular product/service being considered is so novel that entirely new legislation is required.
Key Beneficiaries
In practical terms, the kinds of financial products or services most likely to benefit from sandboxing would be new technology-centric financial service providers a.k.a. FinTech companies. Most FinTech startups tend to focus on disrupting traditional models of operating and will typically employ a combination of novel processes, unconventional business models and innovative products. In doing so, FinTechs will – almost by definition – defy the existing regulatory frameworks which were conceived with the brick-and-mortar realm in mind.
FinTech companies are the primary targets of the Regulatory Sandbox – Internationalbanker.com photo
More Information
The Sandbox was launched at the end of October 2018 and the main documentation can be found on the websites of both the FSC and the Central Bank.
I was one of the speakers at the Bimtech Digital Forum 2018. The forum focused on pertinent considerations for service sector entities participating in the digital economy. The forum was put on by the Barbados Coalition of Service Industries (BCSI) which is dedicated to the acceleration of service sector development and enhancing the export potential of service providers in Barbados.
My ‘power chat’ presentation focused on fundamental data protection considerations for entities in the Barbados services sector. During the presentation, some emphasis was placed on the General Data Protection Regulation (GDPR), key data protection principles and practical next steps for Barbadian service providers.
You can view a copy of my presentation here (.pdf).
The Government of Barbados has released for comment, a 2018 draft of the Data Protection Bill (Mirror ). The draft bill is open for public input until July 31, 2018.
While the timing is somewhat short for a bill with such far reaching implications, I think its commendable that the bill is being opened up to input from all stakeholders, including civil society interests.
This is the second attempt by the Barbados Government to pass a comprehensive data protection bill. A prior iteration of the bill was initially tabled in 2005. However, meaningful progress in Parliament appeared to stall for the better part of the 13 years since.
On my initial scan, a few things jumped out at me which I mentioned in some tweets:
Under the current draft, if you request information about your own data from a data controller then you have to pay for it. This requirement to pay will likely create a hurdle to enforcement of privacy rights under the act.
— Bartlett D. Morgan (@BartlettMorgan) June 23, 2018
I never saw any data breach notification requirements. In the modern era, not having a requirement for data controllers to notify the data subject and/or the data commissioner of a breach is a huge missed opportunity. For my part: pic.twitter.com/v9aeVIU5RC
— Bartlett D. Morgan (@BartlettMorgan) June 23, 2018
I also think the proposed Data Protection Tribunal is a positive. It will counterbalance decisions of the data commissioner (similar to how appellate courts operate).
— Bartlett D. Morgan (@BartlettMorgan) June 23, 2018
If your data rights are breached under the act, you have a right to compensation (as opposed to a fine being paid into Government coffers). Another huge positive. pic.twitter.com/dSyzTzIUWU
— Bartlett D. Morgan (@BartlettMorgan) June 23, 2018
I will be reviewing the bill more closely over the coming weeks, with a view to submitting comments. If personal data protection is something you are interested in, I encourage you to submit comments, via e-mail to Commerce.Comments@barbados.gov.bb.
I was pleased to be asked to co-present with Carlton Samuels at the just-concluded Caribbean Internet Governance Forum (“CIGF”). The CIGF, which was held in Suriname this year, is in its 14th year – which makes it, arguably, the longest running regional IGF in the entire world.
This year’s agenda was fairly heavy on the subject of privacy & data protection. In my view, this is a rather timely area of interest given the impending GDPR (which, literally, comes into effect tomorrow) and recent privacy-related events like the Cambridge Analytica/Facebook fiasco.
Our presentation focused on the Caribbean privacy and data protection landscape and sought to highlight some of the recent legislative developments as well as perceived shortcomings in giving effect to well-established privacy principles in regional legislation. We covered topics including breach notification, trans-border data transfers and fines for breaches.
A recording of the presentation can be viewed below.
I was really pleased to discuss the impending General Data Protection Regulation (GDPR) with Michele Maurius of ICT Pulse recently. On the eve of the GDPR’s commencement, it offered an opportunity to discuss the scope of the new law and, importantly, the potential extra-territorial implications for the Caribbean.
Enforcement powers under Barbados’ Telecommunications Act are now more expansive and clear-cut following recent amendments. The newly passed Telecommunications (Amendment) Act, 2018-10 expressly extends the circumstances in which various enforcement-related activities such as injunctions, search and seizure orders and the issue of warrants may occur. Prior to the amendment, invocation of enforcement powers was almost exclusively grounded in breaches of the Act. Following the amendment, action may now be taken for breaches of any rules, regulations and orders made pursuant to the Telecommunications Act.
If you’re interested in the details, I’ve listed the essence of the changes below.
Previously, the relevant minister had the power to seek injunctive relief or seek damages (pecuniary penalty) only where a telecommunications rule was breached. Under the amendment, in addition to rules, breaches of regulations and orders will also attract injunctions and pecuniary penalties.
Under the amended Act, investigative powers are now extended to a licence issued under either rules, regulations or orders made under the Act. Previously, investigations were limited to breaches of the Act or licences issues under it.
Pursuant to the original Act, the powers to enter, seize and/or search by an authorised inspector were limited to suspected breaches of the Act or a licence issued under it. Under the new amendments, this power has been extended to licences granted under any rule, regulation or order made in accordance with the Act or any registration or authorisation done under the Act.
Magistrates were previously issued with the power to issue search warrants on suspicion that a breach of the Act had happened or was impending. Post-amendment, the magistrate may also issue a search warrant where rules, regulations and orders have been or are about to be breached.
Where anyone interferes with an inspector in the execution of duties, that person will be liable to prosecution if the inspector was performing duties under the Act or any regulations, rules or orders made under it. This power was previously limited to the performance of duties pursuant to the Act itself.
National Commercial Bank, Jamaica – Jamaicaobserver.com photo
Following the Jamaican High Court decision in Aswan v National Commercial Bank, even if a contractual provision provides for confidentiality in your dealings, it may not be enough to protect your intellectual property interests if your actions, subsequent to the entry into the contract, suggest that you are o.k. with your confidential information being disclosed to third parties.
Background
The claimants in Aswan were developers of a point-of-sale top-up software application. The claimants and the defendant bank entered into a joint-venture agreement to create and deploy a customised version of the developers’ point-of-sale software solution. The envisioned end-product would allow users of the point-of-sale devices to ‘top up’ cellular phones with call credit by swiping their credit or debit cards at the point-of-sale machines.
A point-of-sale terminal, similar to the kind Aswan’s software would be used with. Industries.ul.com photo
The contractual documentation included clauses in a proposal document indicating that the information provided in it was confidential. The clause also required the developers’ written consent before the bank could disclose any confidential information to any third parties. Notably, that aspect of the contractual documentation was never actually signed by the bank’s representatives.
The bank eventually sought the help of a third-party entity to assist it with completing other aspects of the project. The bank shared certain information with the third-party developer via emails (on which the developers were copied) including aspects of the confidential information from the proposal document.
The relationship between the developers and the bank started to break down over time. Eventually, the developers terminated the joint venture agreement, for reasons unconnected with the breach of the confidentially clause. Thereafter, a suit was brought against the bank claiming breach of confidence and seeking damages.
Findings of the Court
Despite the bank’s argument that it did not, in fact, sign the relevant parts of the documentation that imported confidentiality, the Court was willing to construe the overall circumstances as importing a duty of confidentiality. The Court arrived at this decision following the approach to contractual interpretation espoused by the Privy Council in AG Belize v Belize Telecom.
Quick background: that case held that in appropriate circumstances, a court can read implied terms into contracts where it is obvious that the parties intended those implied terms to be part of the contract between them.
The Court, notwithstanding the lack of signature on behalf of the Bank, was willing to accept that there was a confidentiality agreement. It declined, however, to enforce it in the circumstances of the case.
The Court reasoned that the confidentiality agreement should not be enforced since the conduct of the developers indicated that they had acquiesced in the sharing of the confidential information with a third-party. The Court was moved by the fact that the bank had copied the developers on emails wherein the bank corresponded with the third-party developer. In those emails, the information which the developers deemed confidential was shared.
Despite this knowledge that a third-party was being provided with the information which the developers were asserting was confidential, the developers did nothing to enforce the right to confidentiality during the life of the contract. In the Court’s estimation, this appeared fatal.
Lessons for ICT Entrepreneurs
The most important lesson here for app developers and others in the ICT space – ensure that your conduct aligns with your contract. If after entering a contract, the parties acknowledge that the expectations and outcomes have shifted meaningfully from what was initially agreed, it makes sense to expressly agree an addendum to the contract, reflecting the new state of affairs. If not, the parties run the risk of having a court belatedly assuming, on their behalf, what they must have meant.
Ensure that your contracts are expressly agreed to by all the parties; don’t just rush to get to work. Some record of what has been agreed to must exist. A signature is ideal but even a confirmatory email can suffice, depending on the circumstances.
The developers in the Aswan case may be considered lucky that the Court was willing to find in their favour that there was a confidentiality agreement between them and the Bank, despite the Bank’s representative having never signed the documentation. A more conservative court may well have gone a different route. Going forward, developers and other service providers should be careful to do all the formalities, including getting the signature (or equivalent record of agreement) of the other parties to the contract.
Although the two developers referred to themselves as ‘HMA Solutions Limited,’ they sued the bank in their own names. It is, therefore, likely that they were using ‘HMA Solutions Limited’ as a mere trading name at the relevant time.
The lesson here: the capacity in which you contract has very practical, everyday consequences, including whether your liability is personal. For example, lets say you entered a contract in your personal capacity and following a breach, you sue the other party in court. If you lose the claim, the cost order of the Court will likely be enforceable against you personally. By contrast, if you entered into a contract via a company you own, separate legal personality dictates that you would not be personally liable for any adverse outcomes.
Note, this isn’t saying a corporate vehicle like a limited liability company is suitable for every kind of venture. This IS, however saying that before you jump into the next potentially lucrative venture, spend a few hours talking over appropriate legal structures to employ with your advisers.
