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Data regulation may force foreign companies to quit Bangladesh: US, UK

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Concerned about the proposed Digital Protection Act (DPA), the United States and the United Kingdom warned on Sunday that any attempt to regulate digital space would not only discourage their companies from investing in Bangladesh, but would also force many existing foreign firms to leave the country.

The observation was made during a discussion on online freedom, data protection, and business investment in Bangladesh, organised by the US Embassy.

US Ambassador Peter Haas, UK High Commissioner Robert Dickson, International Labour Organization Country Director Tuomo Poutiainen, Dr Iftekharuzzaman of Transparency International Bangladesh, and Rubaba Dowla of Oracle Bangladesh  spoke on the occasion.

“We hear apprehension from businesses that propose new laws and regulations in the digital space that will make it more difficult for them to do business here” the US envoy told the discussion.

“And here, let me be frank.  The United States government does have concerns about the regulations for digital, social media, and over-the-top platforms the Bangladesh Telecommunications Regulatory Commission and the Ministry of Information have introduced, as well as the draft Data Protection Act, or DPA,” Mr Haas added.  

He said as the US values its partnership with Bangladesh, it had voiced these concerns directly with the government. 

About the reasons behind the concerns, he said, “We worry the Data Protection Act, if passed with strict data localisation requirements, may force some US companies currently operating in Bangladesh to leave the market."

Online platform regulations will similarly dissuade companies from investing in their businesses here, if they face criminal liability for user contents, he said adding that the consequences could have very negative effects for Bangladesh.

“Over 2,000 startups could be put out of business, and services that Bangladeshis use millions of times every day could become inaccessible,” he said.

“As we look at the draft online platform regulations, we are concerned about the broad definitions for what type of online content is deemed criminal,” he continued.  

The US is also concerned about the recent announcement that 191 online news portals will be blocked as the “ability to accept criticism and ensure freedom of speech even when that speech is unpleasant are hallmarks of a strong democracy,” he added.  

“The US Embassy has heard from many civil society organisations and journalists.  They fear these regulations and laws will restrict fundamental human rights and freedoms. "Likewise with the Data Protection Act.”

In this regard he mentioned that the US is also concerned as the latest draft of the DPA does not provide for an independent data oversight authority and that it includes criminal penalties. 

“While each country must design laws that apply in its local context, there are clear international standards we urge all countries, including Bangladesh, to uphold” he noted.  

He noted that ultimately, development and security must be balanced with democracy and human rights. 

“These values are all linked and mutually reinforcing. Protecting human rights and upholding democracy strengthens a country’s economy and brings sustainable, inclusive prosperity” he said.

However he commended the government of Bangladesh’s move to continue consult with commercial and business entities, civil society, and international partners on these topics. 

 “We sincerely hope that the next draft of the Data Protection Act incorporates feedback from these many sectors, and we believe Bangladesh will be better for it.  We firmly believe that an appropriate balance between international data protection standards, economic connectivity, and individual rights will facilitate this country’s continued development” he said.  

The British High Commissioner in his address said, while we see some promising signs, we also have some concerns and we made these concerns clear to the government both in public and in private but the current state of the debate around the Data Protection Act.

“We have some concerns about the current text as it relates to privacy. We have some concerns about the way that information will be handled and in particular sort of safeguards that will be required.”

According to Mr Dickson, in the Data Protection Act, there's both an opportunity for Bangladesh to modernise its data handling data protection, legal infrastructure, but there's also a risk because the risk is that if this goes wrong.

Highlighting the concerns he said, “First of all, it will continue to intensify the concerns that many international partners have expressed about the human rights trajectory in Bangladesh at a very sensitive time”.

“But there is also a risk that the nascent and incredibly in many ways impressive Bangladeshi IT industry will be will be undermined” he said pointing out that there is also a huge risk of Bangladesh, they find you may find itself unable to access the sort of international tools that are really basic for doing business in a global context.

“And as someone who spent a lot of time trying to encourage and enable British business to invest more in Bangladesh, I can't think of anything that would be less likely to encourage the foreign direct investment that will be needed to sustain economic growth beyond LDC graduation” he added.

The British envoy hoped to see that work intensifying before in particularly the Data Protection Act is solidified into law.

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