India’s education sector, with over 265 million school students, 43 million in higher education, and 110 million learners in skilling institutions (as per the Economic Survey 2023-24), is undergoing rapid transformation. The integration of technology in education, endorsed by the National Education Policy (NEP) 2020, positions EdTech as a necessity rather than a luxury. However, as EdTech grows, it navigates a complex legal and regulatory environment.
Opportunities in EdTech
EdTech spans a wide spectrum, providing solutions across pre-kindergarten, K-12, higher education, corporate skilling, and business-to-business (B2B) or business-to-consumer (B2C) markets. Products include online tutoring, language learning, curriculum development, corporate training tools, and learning management systems. The sector’s growth is underscored by a surge in startups and significant fundraising.
Key Legal Considerations for EdTech
- Education Governance Framework
Education falls under the concurrent list of the Indian Constitution, allowing both central and state governments to legislate. EdTech companies interacting with schools, colleges, and universities must comply with central and state laws. - Intellectual Property (IP) Rights
IP, often the primary asset for EdTech businesses, must be protected through copyrights, trademarks, domain names, and trade secrets. Clear ownership clauses in agreements with employees, consultants, and third parties are essential. For example, in Fermat Education v. Sorting Hat Technologies (Unacademy), an injunction was granted to protect copyrighted content. - Contract Enforcement
Payment delays, particularly when dealing with educational trusts and societies, complicate contract enforcement. Solutions like mediation and conciliation can address these issues, as judicial processes often involve significant costs and delays. - Consumer Protection
EdTech businesses must comply with the Consumer Protection Act, 2019, and E-Commerce Rules, 2020. Cases like Joginder Singh Saini v. Byju’s demonstrate the evolving nature of consumer protection in EdTech. - Data Privacy and Protection
With many EdTech platforms collecting sensitive personal data, especially from minors, compliance with the Information Technology Act, 2000, and the Digital Personal Data Protection Act, 2023, is critical. Companies must assess their roles as data fiduciaries or processors, adopt robust consent mechanisms, and ensure secure data storage and processing practices. - Corporate Governance
Strong corporate governance is crucial for maintaining trust in the education sector. High-profile issues, such as those faced by Byju’s, underscore the need for adherence to governance norms. Allegations of auditing delays, lack of transparency, and regulatory non-compliance have tarnished the sector’s image.
Challenges in the Legal Landscape
- Regulatory Ambiguity: Many EdTech companies operate outside conventional educational setups, leading to unclear regulatory expectations.
- Evolving Laws: With new regulations like the Digital Personal Data Protection Act, 2023, companies face increasing compliance requirements.
- Trust Deficits: High-profile governance failures erode public confidence in EdTech businesses.
The Way Forward
As the NEP 2020 emphasizes “learning how to learn,” EdTech is set to play a pivotal role in India’s educational evolution. However, the sector must proactively address legal and regulatory challenges to sustain growth and public trust. Key priorities include:
- Enhancing IP and data protection measures.
- Strengthening corporate governance practices.
- Navigating regulatory frameworks effectively through collaboration with policymakers.
EdTech’s success hinges on its ability to innovate while adhering to the highest legal and ethical standards. With India’s vast educational landscape, the sector remains poised for growth, provided it balances opportunity with responsibility.
