The Illusion of ‘I Agree’: Unmasking Consent in Clickwrap Agreements in India

Introduction

In a survey conducted by Deloitte, more than 90 per cent of Indians agree to the terms and conditions contained in the clickwrap agreements without reading them. This is the blind consent that is often employed by modern user interfaces. The UX design and packaged consent clauses conceal important obligations, and the latter can even force privacy disclaimers on such contracts. Misrepresentative or hidden terms can be struck down in the Indian Contract Act, 1872. This is seldom actually done in the real world. Following the needs of the Indian law, this blog examines the real-life consequences and limitations of click-wrap agreements.

Clickwraps represented in terms and conditions are legally binding contracts whereby once the user clicks the I agree button, the contract becomes effective. Business entities claim that they are a very important form of electronic contract since they enable them to obtain customer approval in practice. As a matter of fact, however, there is no means of ensuring that users have, in fact, read the terms and conditions before accepting them, whether they have or have not actually read the terms and conditions of a particular agreement or even the entire terms and conditions. The terms and conditions are often stated in a very disorganised form, and the size of the text is so minute that it cannot be read, which creates a concern of consent in serious regard. Subsequently, users end up agreeing to the same without even reading the terms and conditions. This implies a failure to take consent contrary to section 14 of the Indian Contract Act, 1872.

In his formula of humanity, Immanuel Kant explains how important individuals are by referring to them as ends rather than means. He contends that people can make their own choices and that they are rational. According to Kant, an authentic consent will exist when the individual consenting to the same has the free and exhaustive information regarding the same. A valid consent is also explained in the Kantian ethics; it is said to be an assent, which is voluntary and rational. The whole idea of the click wrap contracts contravenes the consent theory, which is not only philosophical, but also in the sections of the Indian Contract Act. 

Dark-Pattern Design and Its Implications

Well, dark patterns are tricks that are used to trick us, right? These interfaces attempt to make us accept something that we would not accept if we were aware of everything. In recent times, our consciousness is being sounded by regulators concerning such disingenuous clickwrap contracts, where the terms may be completely different from what we imagine. These are not the only practices; many practices in basket sneaking were highlighted in 2023 by the Ministry of Consumer Affairs as unfair practices, such as basket sneaking, when additional products are added to your cart unbeknownst to you. The other one is forced subscription, in which the sites do not bother at all to inform us about the matters of repeat charges. They usually hide the cancel button or make it such a nuisance that we simply overlook it. The other issue raised by the Ministry was interface interference: the design deceives you into doing anything that is not in your best interest. As an example, the No or cancel button is generally grey and difficult to notice, whereas the yes or I agree button is in bright green and highly conspicuous to deceive us. Such strategies effectively destroy free consent in reality.

Bundled Consent Clauses and Privacy Waivers

According to Section 6 of the Digital Personal Data Protection Act, 2023, a valid consent must be free. Free consent is impossible if there is a bundling of terms and conditions or if such consent is given by pre-ticked boxes. For instance, in 2021, WhatsApp released a diabolical policy where a privacy update compelled users to share their data with Facebook. If a user denies it, they would lose the service. In another case, a coffee shop demanded the customers' phone numbers. If the customers disagreed to share the same service, it would be denied to them. The Chandigarh Consumer Commission held that it was a forced action and lacked free consent. It also added that it could be included under dark patterns. These cases illustrate the grave concern regarding privacy risks and forced or a lack of consent surrounding clickwrap agreements, as a result of bundled consent clauses.

Way Forward

Having regard to the aforementioned shortcomings of clickwrap agreements, the moment has arrived to devise corrective measures to prevent any misuse. Apart from conducting public awareness campaigns, the following are some courses of action that India could inculcate in its laws and policies to ensure fair electronic agreements.

1. Mandate transparent interface design

Regulatory authorities should issue guidelines prohibiting dark patterns. The “I disagree/deny” and cancellation options should be made just as visible as the assent options.

2. Prohibition of bundled consent

Mandate on separate checkboxes for different types of consent and prohibition on the pre-ticked boxes.

3. Regulation and penalisation of dark patterns

Codify unfair trade practices and impose a penalty on the same.

4. Establishment of a consent-review window

Introduce a cooling-off period to allow users to cancel or revoke their consent within a certain period of time, without any penalty.

5. National consent framework

Create a standardised nationwide consent framework consisting of what would precisely come under “consent” and how it should be obtained and managed.

6. Consent literacy models

Before proceeding with the terms and conditions, the businesses could provide users with information on consent models through a short, animated video or something, to ensure that they are aware of what they are doing. This could specifically work well for major data policies or auto-renewing subscriptions.

7. Consent fairness index

Consent fairness index may be the score awarded to a business on the basis of the transparency and fairness of its consent practices. This may be like LEED building ratings.

8. Index of consent shortcomings monitoring.

This may be a control system that monitors the frequency with which users are blindly clicking the I agree button without necessarily reading the terms and conditions of the consent form. This may be calculated by verifying whether they have altered the default settings in any way or not. A business with such blind clicks would be flagged, resulting in a penalty in case of high rates.

9. Socratic Model

According to the Socratic Questioning, businesses are required to pose several questions prior to laying out the list of terms and conditions. The questions could be-

• What do users lose by agreeing to the terms and conditions?

• What would happen if the users deny?

• What would the business get, as a result of consent on the part of the user?

This would mean that the users would be well informed of what they are getting into, which would lead to transparency.

Conclusion

With the wave of a digital world, where one can buy and sell with a single click, the concept of clickwrap agreement poses a terrifying threat to the legal doctrine of free consent, which is codified in the Indian Contract Act, 1872 and the Digital Personal Data Protection Act, 2023. Though the above legislation has acknowledged electronic contracts, they do not cover the complex issues that emerge due to the above discrepancies of clickwrap agreements. Such an incompleteness of the practicality of clickwrap contracts abides not only in the Kantian philosophy paradigm of free consent, but also in the ethical imperative to approach the user as a rational and independent entity.

Pertaining to the judicial precedents concerning clickwrap agreements, HDFC Bank v Kumar and Trimex International v Vedanta Aluminium recognised electronic contracts and maintained their enforceability provided that clear terms and active acceptance exist. However, in  CIT v Gujarat Pipavav Port Ltd., the court held that contracts enforcing unconscionable and one-sided terms are not enforceable. This could be seen in the light of clickwrap agreements, where agreements made through one-sided terms should be struck down. Yet, there is a dearth of a uniform approach to electronic contracts and their enforcement, rendering consumers vulnerable to unfair practices.

On comparing the Indian judicial precedents with those of the United States of America and the European Union, one could find better approaches that, if implemented in India, could assist in mending the gap between the Indian statutory provisions and the practicality of clickwrap agreements. In cases such as Hotmail Corp. v Van Money Pie and the CJEU's CarsOnTheWeb, the courts held that digital or electronic consent is valid only when users have adequate notice and control. These are the standards that India could also meet and inculcate in its laws and policies to ensure better protection of consumer rights in the digitalised world. It can therefore be concluded that India must not just codify more consistent norms of consent, but also inculcate judicial consistency and congruence of policy with international best practices.

In a world where people become more digitalised, it is desperately needed to reevaluate and formalise the exact manner in which consent is to be obtained and understood. Today, it is not very often that clickwrap concepts consider fairness and consumer rights more than they are enforceable. Result? Exploitation of the users. To ensure the real spirit behind the law of contract, which is the voluntary, informed and free consent, India will be required to recognise electronic consent as concerns click wrap agreement as a substantive right and not a mere procedural formality.

Author: Abhishek Gope, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney.