Lobbying in India and in the United States

The 2007 tightening

The Honest Leadership and Open Government Act of 2007 amended the scheme after a series of scandals. It is the reason reporting became quarterly rather than half-yearly, and it added restrictions around gifts, travel and the movement of former members and staff into lobbying.

The separate regime for foreign interests

An agent acting for a foreign government, party or principal registers under a different statute altogether, the Foreign Agents Registration Act of 1938, and files under the supervision of the Attorney General. The point for an Indian student is that a foreign company or government seeking to influence American policy is on a public register, which is why Indian newspapers have from time to time been able to report exactly how much a foreign firm spent lobbying on an Indian policy question, and on what. That reporting is possible because the American filings are public; the Indian side of the same transaction is not recorded anywhere.

What the American system achieves, and what it does not

It achieves disclosure. Anybody can find out who is registered, for whom, on what.

It does not achieve equality. Disclosure tells you that one side spent a hundred times what the other did; it does not change the fact.

It has known gaps. The twenty per cent rule and the thresholds let a good deal of activity go unregistered, and "strategic advice" that stops short of contact is outside the definition altogether.

India

There is no lobbying law

India has no statute that registers lobbyists, defines lobbying, or requires anybody to disclose that they lobbied. A full-text search of India Code, which carries central and State legislation, returns no enactment on the subject; the word appears only in unrelated contexts such as hotel lobbies. Private members' proposals to create a disclosure regime have been introduced from time to time and none has become law.

What India has instead

The criminal law of bribery. The Prevention of Corruption Act 1988 punishes a public servant who takes an undue advantage and, since the 2018 amendment, also punishes the giver. That reaches the far end of the spectrum and nothing before it: a meeting, a memorandum or a drafted clause is not an offence, and neither is it recorded.

Parliamentary privilege and discipline. Each House may discipline its own members, and in an extreme case expel them. This is where the leading Indian authority sits.

Facts. Raja Ram Pal v. Hon'ble Speaker, Lok Sabha, (2007) 3 SCC 184, arose from a broadcast on 12 December 2005 by the television channel Aaj Tak. In an operation it called Operation Duryodhana, the channel recorded persons said to be members of Parliament accepting money for tabling questions and raising issues in the House. The episode was reported as "cash for questions". Both Houses appointed inquiry committees, and on their reports ten members of the Lok Sabha and one member of the Rajya Sabha were expelled by resolutions of their respective Houses. The expelled members petitioned the Supreme Court under article 32, arguing that no House had any power to expel a member at all, that expulsion deprived their constituencies of representation, and that the inquiry had been unfair.

Held. A Constitution Bench of five judges dismissed every petition. It held that each House possesses the power to expel a member under article 105(3), that this power conflicts with no other constitutional provision, and that it does not injure the constituency, since an expelled member may stand again and the constituency may return him. It held that proceedings of a House are open to judicial review where they are vitiated by illegality or unconstitutionality, though not for mere irregularity of procedure, which article 122 protects. On the facts it found relevant material in the video recordings, no violation of articles 14, 20 or 21, and a fair opportunity given to each member, and it declined to review the quantum of punishment, which it said must be left to the House.

Why it matters here. It fixes the outer edge of the influence spectrum in Indian law and shows what India has in place of a disclosure statute. Paying a member to ask a question is not lobbying; it is corruption, and it was dealt with. But it was dealt with by the House's own disciplinary power, after a television channel exposed it, with no register, no filing and no requirement that anything be published in advance. Everything short of a payment leaves no trace at all.

Codes of conduct. Both Houses have ethics machinery and codes of conduct for members, and members must declare their interests. These bind the member, not the person who approaches them.

Disclosure by companies. Companies must disclose political contributions in their accounts, which catches money to parties and not money spent on influencing a rule.

How lobbying is actually done in India

It happens, on a large scale, and under other names: industry associations, public affairs consultancies, law firms with a policy practice, retired officials retained as advisers, and personal access. Because none of it is registered, an ordinary citizen cannot find out who met a minister about a rule that affects them, which is the practical difference from the American position.

Three episodes are usually cited in discussion of the subject, and they should be described for what they are. The publication in 2010 of intercepted telephone conversations of a corporate public relations professional showed how access was arranged and how far it extended, and it produced a national debate about lobbying but no statute. The cash for questions expulsions in 2005, above, showed the disciplinary route. And the public filings made in the United States by foreign companies about their lobbying on Indian policy questions showed that the same activity is documented in one country and invisible in the other.

A worked example

A foreign technology company wants an Indian data localisation rule relaxed, and the same company wants an American export restriction eased.

On the American side, its conduct is on a public record. It retains a firm, and the firm registers under the Lobbying Disclosure Act because its income from the client will exceed the threshold in section 1603(a)(3). Every quarter it files under section 1604, naming the client, the issues, the chambers and agencies contacted and the money spent. If it acts for a foreign government rather than a company, it registers under the Foreign Agents Registration Act instead. A student in Mumbai, with a browser, can read all of it.

On the Indian side, it approaches an industry association, which makes a submission to the ministry; it retains a public affairs consultancy, which arranges meetings; and it commissions a study at a policy institute. Every one of these is lawful and none of it is registered, filed or published. If the rule is relaxed, nobody outside the ministry can say who asked for it, how often, or what was argued.

The measurable difference. Two identical campaigns, one of which leaves a public paper trail and one of which leaves none. Notice that the American filings do not stop the company from being heard, and do not equalise its voice against a citizens' group's. What they produce is a record, and it is the record, not any restriction, that is the whole content of American regulation.

Distinctions that carry marks

What this is NOT

"India has no lobbying" is false. India has no lobbying law. The activity is at least as extensive as anywhere else; it is simply not on a register.

American regulation does not make lobbying fair. Disclosure changes what is known, not who is heard.

Registration is not licensing. The American statute does not decide who may lobby or how much. It requires that those who do say so.

The absence of an Indian statute is not an absence of any law. Bribery is an offence, parliamentary privilege is enforceable, and codes of conduct bind members. What is missing is regulation of the lawful part of the activity, which is most of it.

Quick revision

1. United States: Lobbying Disclosure Act of 1995, 2 U.S.C. ss.1601 to 1614. s.1602 defines a lobbyist, more than one contact and the twenty per cent exclusion; s.1603 registration with thresholds of $2,500 income per client or $10,000 of expenses in a quarter; s.1604 quarterly reports; s.1605 disclosure and enforcement.
2. Strengthened by the Honest Leadership and Open Government Act of 2007, which brought quarterly reporting and gift, travel and revolving-door restrictions.
3. Agents of foreign principals register separately under the Foreign Agents Registration Act of 1938, 22 U.S.C. s.611 and following.
4. India: no statute at all. India Code carries no enactment on lobbying.
5. India reaches only the far end: the Prevention of Corruption Act 1988, parliamentary privilege and expulsion, and codes of conduct.
6. Raja Ram Pal v. Hon'ble Speaker, Lok Sabha, (2007) 3 SCC 184: cash for questions, eleven members expelled, power to expel upheld under article 105(3), judicial review available for illegality but not for irregularity of procedure under article 122.
7. The one-line comparison: in America influence is recorded and unequal; in India it is unequal and unrecorded.

Test yourself

1. How does the Lobbying Disclosure Act of 1995 regulate lobbying? Not by prohibition but by disclosure. Section 1602 defines a lobbyist as one retained for compensation whose services include more than one lobbying contact, excluding anyone whose lobbying is less than twenty per cent of the time spent for that client in three months. Section 1603 requires registration above money thresholds of $2,500 of income per client or $10,000 of expenses in the quarter. Section 1604 requires quarterly reports naming clients, issues, contacts and amounts, and section 1605 makes them public and enforceable.

2. What is FARA, and why does it matter to an Indian student? The Foreign Agents Registration Act of 1938, 22 U.S.C. section 611 and following, which requires agents acting for foreign governments, parties and principals to register and file separately, under the supervision of the Attorney General. It matters because it is why the sums a foreign company spends lobbying on an Indian policy question can be read off an American public record, while the Indian half of the same activity appears nowhere at all.

3. What law governs lobbying in India? None. There is no Indian statute that defines lobbying, registers lobbyists or requires disclosure of it, and a full-text search of India Code returns no enactment on the subject. Indian law reaches only the extremes: the Prevention of Corruption Act 1988 where influence becomes a payment for an official act, and the disciplinary and privilege jurisdiction of each House of Parliament where a member is involved. Everything lawful in between is unrecorded.

4. State the facts and the holding in Raja Ram Pal. In December 2005 a television channel broadcast recordings of persons said to be members of Parliament accepting money for tabling questions. After inquiries, ten Lok Sabha members and one Rajya Sabha member were expelled by resolutions of their Houses, and they petitioned under article 32. A Constitution Bench dismissed the petitions, holding that each House has the power to expel under article 105(3), that the power does not violate any constitutional provision or the constituency's rights since the member may stand again, and that proceedings of a House may be judicially reviewed for illegality or unconstitutionality but not for mere irregularity of procedure, which article 122 protects.

5. Compare the Indian and American positions and say which you would adopt, with reasons. The American system defines lobbying, registers those who do it above modest thresholds, and publishes quarterly what was spent on whom and about what; the Indian system does none of this and reaches only bribery and breach of privilege. The American approach does not equalise access, and it has real gaps in the twenty per cent rule and in advice that stops short of contact. It nonetheless produces a record, and a record is what makes the second face of power visible: a citizen in India cannot presently discover who was consulted about a rule that governs them, which is an argument for a disclosure statute rather than for a prohibition.