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Can you explain some of the regulatory challenges faced by legal team in working for a leading multinational in automobile sector?

Automobile MNC companies have been experiencing many policy changes of late starting from the introduction of BS-VI norms with effect from April 2020 onwards (from BS IV norms), the mandating of compulsory third party insurance of three years for four wheelers leading to price increases and a slowdown in demand in the automotive sector, changes in the CMVR regulations, vehicle electrification norms, and charging infrastructural issues, safety norms, high GST rates etc. Some of these changes have impacted the automobile sector, which is undergoing a slowdown in demand in India, as many companies have cut their production, dealers have shut up shop resulting in a loss of employment of more than 100,000 employees. The government is really concerned about the above issues and has initiated talks with the industry to facilitate a good environment for automotive industries to grow in India and hopefully things will improve in the near future

What “legal tech” products does the team utilise? What is useful about the products and how could they be improved?

We have procured a legal compliance software, named Legatrix, from a vendor which is indeed a revolutionary concept for ensuring compliance of laws by one and all in the company. This software lists down each and every regulation applicable to the company from the Indian perspective and prompts them to update the compliance documents and confirm the same within prescribed time limits. Manupatra is another online legal database which provides details of each and every regulation with up to date amendments including updated case laws from all the courts in India. We have also digitalised our board meetings. Our in-house IT department has developed a software wherein instead of physical board meeting folders containing agendas, covering notes and presentations, we now have the privilege of uploading everything on a portal which could be viewed by all the board members at any time. This facility has reduced a lot of paper work and saved a lot of time for the legal team. Further improvements planned involve the digitalisation of each and every activity in the legal department – right from drafting of legal notices to pleadings in court.

How does the team ensure it remains aligned to the company and its goals?

The legal department being part of Volkswagen India is mandated to implement “TOGETHER 25+ – Strategy 2025”. This strategy provides a direction to all Group companies in the Volkswagen Group to focus on the following essentials: best governance, best performance, best brand equity, software enabled car company, excellent leadership. The trust our customers continue to place in us and the perception of Volkswagen as an excellent employer are crucial for the group’s success. The strategic objective of the integrity and legal affairs functional area is therefore to anchor these factors as the basis for daily activities in the organisation, thereby making a vital contribution to Volkswagen’s sustainable growth. This specifically entails safeguarding customers and staff against compliance risks and positioning the functional area as a competence centre for integrity and legal affairs, data protection, compliance and risk management. Towards the above objective we have already rolled out policies within the company towards data protection, compliance and risk management, document custody, a whistleblower mechanism, compliance policies and a code of conduct. Numerous awareness sessions have been conducted in this regard for functional areas and employees have been made aware about the same. We continue to focus on ensuring that our customers perceive Volkswagen as the best company always.

Over the next 12 months, what are the most important things for your legal department to achieve? Skoda Auto India Private and Volkswagen Group Sales India are being merged with Volkswagen India. In this direction the Volkswagen Group is investing €1bn towards the implementation of the India 2.0 project, primarily between 2019 and 2021. The legal department have their hands full with the following topics in the next 12 months: ensuring a smooth merger of all companies; consolidating the legal department and aligning the contracts, compliances and litigations across the three entities; ensuring the governance committees, SOPs, documents, processes in all the entities are consolidated properly; and updating the licences, registrations etc. with regulatory authorities. The legal function – a sought out voice. Businesses today are grappling with a lot of challenges not only in the consumer expectations and market uncertainties but also drastic changes in law which impacts them substantially. The role of the legal function thus becomes of paramount importance in guiding the management in making them understand the complexities of the laws which are going to be passed much in advance and also negotiating with government authorities at various forums for ensuring that businesses don’t get affected all of a sudden due to amendments in law. Management looks to the legal department to provide them with creative solutions whilst interpreting the laws as such. To this extent we are proud to have positioned legal as a formidable part of management and a sought out voice on reputational issues and commercial challenges. Thus our legal team in Volkswagen India has the right balance of business and legal acumen for coming out with creative solutions to such issues promptly and we facilitate amicable solutions expeditiously for all functions.