Advocating for Digital Rights and best practices in Nepal

Digital Rights Weekly/Year 3/ Issue 14

Apr 05, 2024
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Cotiviti Nepal Faces Legal Action: Implications for Taxation and Tech Industry in Nepal
The Department of Revenue Investigation (DRI) has initiated legal action against Cotiviti Nepal Pvt Ltd for alleged revenue leakage, aiming to recover Rs 10.36 billion from the company. This case marks one of the largest amounts pursued by the DRI against a single business entity. Cotiviti Nepal, a subsidiary of Cotiviti Inc. USA, is accused of tax evasion related to income tax and value-added tax (VAT). The Nepalese IT industry is alarmed by this case, particularly concerning the imposition of VAT on exported goods and services, potentially jeopardizing the sector’s viability.
Experts are concerned that the case against Cotiviti could lead to the collapse of the IT industry, setting a precedent that may hinder Nepal’s progress. Senior advocate Prof Dr. Gandhi Pandit has questioned the taxation implications of the Cotiviti case. He agrees that Cotiviti should pay capital gains tax but emphasizes the importance of clarifying whether its Nepalese subsidiary is considered a resident of Nepal. This uncertainty could affect Nepal’s investment climate, particularly during the upcoming investment summit in April. Pandit advocates for a more lenient tax system to attract foreign investment and foster economic growth, drawing parallels to the negative impact witnessed during the Ncell case.
Politicians Intolerant to Criticism: Freedom of Expression Under Threat
Two incidents this week show the growing intolerance of politicians against free speech and their criticism in Nepal. Firstly, Ram Prasad Poudel, an employee of Kathmandu Metropolitan City (KMC), faces charge sheet which includes five years in jail for posting a Facebook status criticizing Mayor Balen Shah. Poudel has been charged under section 47 of the Electronic Transaction Act for allegedly spreading hatred against the mayor. Secondly, Nikita Poudel, wife of Home Minister Rabi Lamichhane, has filed a defamation case against multiple media outlets, including Nagarik Daily, Kantipur Daily, Online Khabar, and ukera, demanding imprisonment, fines, and substantial compensation.
These actions have sparked concerns among civil societies regarding self-censorship and the erosion of both citizens’ freedom of expression and press freedom. These incidents should be considered from the perspective of potential chilling effect on open discourse, threat to media independence, misuse of legal provisions, lack of governmental accountability, and role of judiciary in safeguarding democratic principles.

Google Settles Privacy Lawsuit: Deleting Data and Limiting Tracking
Google has reached a legal settlement in a class action lawsuit filed in the US in 2020, where it was accused of invading users’ privacy by collecting data even in “private mode.” The deal includes Google agreeing to delete billions of records and accepting restrictions on tracking users’ activities. Although Google disputes the claims, it supports the settlement and has already implemented changes, including clarifying its data tracking practices and automatically blocking third-party cookies for certain users. The settlement, which requires court approval, follows increased scrutiny of big tech firms’ practices in the US and elsewhere. Despite not admitting fault, Google agreed to delete data and undergo restrictions in the proposed settlement.

Concerns Over ICT Misuse in SEE
In the current Secondary Education Examination (SEE), there has been a concerning rise in the number of reported cases related to the illicit use of mobile phones and the internet for cheating. Law enforcement agencies have intervened in various instances where individuals were suspected of accessing cheating materials via social media platforms, directly from their mobile devices. These incidents have been observed across different examination centers nationwide.  This year, a significant number of 504,414 students, comprising 250,772 girls, 253,627 boys, and 15 students from sexual and gender minority communities, are participating in the SEE examinations across 10,806 schools nationwide.

Cyber Bureau Warns Against Social Media Deception and Malware Threats
The Cyber Bureau of Nepal Police has urged the general public not to be lured by misleading information through social media. On 3 April, the Cyber Bureau issued a notice urging not to download and install the software from the link sent on various pretexts such as providing online data entry from, providing IELTS/PTE exam preparation classes free of cost and providing share transaction analysis training free of cost. The Bureau has urged the general public not to be lured by such misleading information and not to click on the links received from such pages.

Report Exposes Social Media Giants’ Restrictions on Reproductive Rights Information Worldwide
The Center for Countering Digital Hate (CCDH) and MSI Reproductive Choices collaborated on a report revealing restrictive measures by social media and advertising platforms on abortion and reproductive rights information in Africa, Asia, and Latin America. The report, highlighted by the Guardian, exposes Meta and Google for hindering access to crucial reproductive healthcare information, particularly in countries like Ghana, Kenya, Mexico, Nepal, Nigeria, and Vietnam. Meta, parent company of Facebook, and Google Ads were found to restrict or remove ads from reproductive health organizations like MSI, citing vague reasons such as “sensitive content” or alleged personal attribute implications.

Government open application for National ICT Award 2024
The Government of Nepal has opened application for National ICT Award 2024, coinciding with the National Information and Communication Technology Day on May 2nd. This annual event recognizes outstanding contributions in seven distinct categories within the country’s ICT sector. Individuals and institutions are encouraged to apply or nominate candidates for consideration. Interested parties can download the application form for their chosen category, complete it, and submit it by April 16 2024 to ictwards2024@mocit.gov.np.
Research/Publication

The Human Rights Costs of Data Localization Around the World
Data localization, in which companies are mandated to store personal data on local servers, is a growing policy area. But particularly in contexts with poor rule of law, such requirements can allow authorities to access people’s data more easily, creating a fertile ground for human rights abuses. Four civil society experts weigh in on why data localization is becoming an increasingly common policy and what this means for people’s rights.
For more: https://www.techpolicy.press/the-human-rights-costs-of-data-localization-around-the-world/

Digital Rights Weekly is a week-based update on Digital Rights and ICT issues, that happened throughout the week, compiled and analyzed from the digital rights perspective by Digital Rights Nepal (DRN). DRN is a not-for-profit initiative dedicated to the protection and promotion of digital rights, including the right to online freedom of expression and association, online privacy, access to information, and related issues such as internet governance, cyber laws/policies, and cyber securities in Nepal.
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