EU’s Markets in Crypto-Assets (MiCA) Law

The Markets in Crypto-Assets (MiCA) law of European Parliament is the first comprehensive regulation for cryptos, and some expect it to become a trendsetter for crypto regulation globally.

What is MiCA Legislation?

The MiCA law seeks to address concerns like money-laundering, protection of consumers and investors, accountability of crypto firms, stablecoins and the environmental footprint of crypto mining.

It would regulate the “wild west” of crypto assets and provide legal certainty for those issuing crypto assets, while ensuring high standards for investors and consumers.

It also excludes non-fungible tokens, but the EU may make a horizontal legislation for NFTs in 18 months, after a separate assessment.

How will MiCA regulate stablecoins?

The efficacy of stablecoins, which claim to be less volatile that other cryptos, came into question after the crash of some crypto-currencies.

The MiCA would mandate that stablecoin issuers maintain minimum liquidity to provide for sudden large withdrawals by users, and the reserves must also be protected from insolvency.

The European Banking Authority (EBA) has been brought in to supervise stablecoins, and the law asks stablecoin issuers to provide claims to investors free of charge.

In addition, large coins which are used as a means of payment will be capped at €200 million worth of transactions per day.

How will the new law regulate money laundering?

MiCA requires the EBA to maintain a public register of non-compliant crypto asset service providers (CASPs).

Additional checks will be required, in line with the EU Anti-Money-Laundering (AML) framework.

How does it address green concerns?

Under MiCA, crypto companies will be required to declare their environmental and climate footprint.

The European Securities and Markets Authority will develop regulatory technical standards on methodologies, content and presentation of such information.

The EC will also have to provide a report on the impact of crypto assets on environment.

It would introduce mandatory minimum sustainability standards for mining mechanisms, especially the proof-of-work system which raises overall computing power.

Will it affect Indian regulations?

India’s crypto regulations seem to have taken a back seat at the moment.

Industry executives and experts say the government and industry are more concerned about taxation.

India levied a 30% tax on income from transfer of cryptos from April, and added a 1% tax deduction at source from 1 July.

This, along with the overall bear market, has depressed trading volumes, and revenues of crypto exchanges.

Indian regulators are also expected to consider rules being developed in the US before taking concrete decisions.

Odisha eyes Forest Rights Act implementation by 2024

The Odisha government is chasing an ambitious target of completing the implementation of the Forest Rights Act (FRA) by granting all kinds of rights mandated under the historic Act by 2024.

What is Forest Rights Act (FRA)?

The symbiotic relationship between forests and forest-dwelling communities found recognition in the National Forest Policy, 1988.

The policy called for the need to associate tribal people in the protection, regeneration and development of forests.

The Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006, was enacted in this regard.

It aimed to protect the marginalised socio-economic class of citizens and balance the right to environment with their right to life and livelihood.

Provisions of the 2006 Act

The Act recognizes that tribal and other traditional forest-dwelling communities would be hard put to provide documentary evidence for their claims.

Rule 13 of the Act, therefore, stipulates that the Gram Sabhas should consider more than one evidence in determining forest rights.

The rule sanctions a wide range of evidence, including “statements by village elders”, “community rights” and “physical attributes such as houses, huts and permanent improvements made to land such as levelling, bunds and check dams”.

Why in news now?

The forest rights claims of these tribes and forest-dwellers are mostly rejected by the States.

Being poor and illiterate, living in remote areas, they do not know the appropriate procedure for filing claims.

The gram sabhas, which initiate the verification of their claims, are low on awareness of how to deal with them.

Why are forest rights important for tribals?

Aimed at undoing the “historic injustice” meted out to forest-dependent communities due to curtailment of their customary rights over forests, the FRA came into force in 2008.

It is important as it recognises the community’s right to use, manage and conserve forest resources, and to legally hold forest land that these communities have used for cultivation and residence.

It also underlines the integral role that forest dwellers play in the sustainability of forests and in the conservation of biodiversity.

It is of greater significance inside protected forests like national parks, sanctuaries and tiger reserves as traditional dwellers then become a part of management of the protected forests.

Who are the Pasmanda?

In a political conclave in Hyderabad, PM made a special mention for the Pasmanda muslim community and their social upliftment.

Who are the Pasmanda Muslims?

The word Pasmanda is derived from the Persian language meaning ‘left behind’.

The Pasmanda community comprise of Dalits and Backward Muslims who are fighting a different social battle inside the society.

This community has its stronghold in Uttar Pradesh where the Pasmandas account for around 75% of the total Muslim population.

In fact, 85% of the total population of Muslims in the country is known as Pasmanda.

It is believed that the so-called untouchable Hindu converts are categorised as Pasmanda.

A caste system in minorities

The caste system is applicable to Asian Muslims in the same way as it is applicable in the Indian society.

Among the South Asian Muslims including those living in India, 15% are considered upper class or upper caste, called Ashraf.

The remaining 85% Muslims known as Arzal and Ajlaf are considered to be Dalit and backward. Arzal means degraded.

Why political parties are focusing on them?

If reports are to be believed then the creamy section of the Muslim society looks down upon them.

They are backward and oppressed economically, socially and educationally. This oppressed section among Muslims is called Pasmanda in India.

A social movement in making

Actually the Pasmanda movement in India is 100 years old. A Muslim Pasmanda movement had emerged in the second decade of the last century.

After this, in the 90s in India, two big organisations were formed in favour of the Pasmanda Muslims.

This was the All India United Muslim Front, whose leader was Ejaz Ali.

Apart from this, Ali Anwar of Patna founded an organisation named All India Pasmanda Muslim Merej.

However, both are termed as non-Islamic by Muslim religious leaders.

All the small organisations of Pasmanda Muslims are mostly found in Uttar Pradesh, Bihar, Jharkhand and West Bengal.

A ‘no’ to pharma freebies

The judgment by a two-judge Bench of the Supreme Court dismissed the Special Leave Petition by Apex Laboratories to claim deduction on freebies given to doctors.

About the case

 In the said case, the company was giving out freebies to doctors in order for them to create awareness about a health supplement it was manufacturing called Zincovit.

Prohibited by the law: Upholding a decision by the Madras High Court, the Bench said that the act of pharmaceutical companies giving freebies to doctors is clearly ‘prohibited by the law’.

Further, it cannot be claimed as a deduction under Section 37(1) of the Income Tax Act, 1961.

The judge said that in the process of interpretation of the law, it is the responsibility of the court to discern the social purpose which the specific provision subserves.

 Invoking the principle of implied condition, the Court relied on the precedents in the case of P.V. Narasimha Rao (1998) 4 SCC 626 under the Prevention of Corruption Act, and Jamal Uddin Ahmad (2003) 4 SCC 257 under the Representation of the People Act.

Immoral practice

Breach of trust: Laying emphasis on the fiduciary relationship between doctor and patient, the Court noted that a doctor’s prescription is considered as the final word on medication by the patient even if the cost of such medication is unaffordable.

In a situation where such trust is reposed in doctors, having prescriptions manipulated by the lure of freebies is immoral.

Driving up the cost of medicine: The Court was conscious that the cost of such freebies is factored in the cost of medicines sold, in turn driving up their prices and perpetuating a publicly injurious cycle.

This fact was taken note of by the Parliamentary Standing Committee on Health and Family Welfare in its 45th report, dated August 4, 2010.

Report from the US: In its elaborate judgment, the Supreme Court bench also took note of a report issued by the United States Department of Health and Human Services Office called “Savings Available Under Full Generic Substitution of Multiple Source Brand Drugs in Medicare Part D”.

Here, it was stated that the beneficiaries could have saved over $600 million in out-of-pocket payments had they been dispensed generic equivalent drugs.

 In the U.S., by the reason of the Physician Payments Sunshine Act 2010 also known as Section 6002 of the Affordable Care Act (ACA) of 2010, the law compels the manufacturers of drugs, devices, biologic and medical supplies to report to the Centers for Medicare and Medicaid Services, on three broad categories of payments or transfers of value.

Way forward

Keeping the price under control: Even though the Drug Price Control Order and Drugs and Cosmetics Act are there on the statute book, there is hardly any action to keep the sale price of medicines under control with due and proper investigation into their so-called research and development costs and keeping their profit margins within a prescribed limit.

The law should be amended to compel the manufacturer of drugs to sell at the verified genuine cost, that also factors in a reasonable profit margin for each product by bringing manufacturers, both foreign or domestic, under the control of the MCI or any other equivalent body.

This must be at a uniform rate throughout the country; further, classified life saving drugs should be sold at cost only or even at subsidised rates.