Sunset Clause in India: Meaning, Types, Example, Purpose, and Benefits

Sunset Clause is a global practice in the public policymaking domain with various historical precedents.  Why do policymakers adopt this clause? This article explains the meaning of the sunset clause, its origin, purposes, and other essential details. Stay with us.

What is a sunset clause in law? 

A sunset clause is a provision that can be included in any legislation to delimit the validity, applicability, or enforceability of a law on a time scale. This legislative and policy-making practice got its name because we consider sunset as a universally accepted time-keeping phenomena.

The underlying principle behind the sunset clause can be traced back to a Roman law rule that meant What is applicable for a specified period would cease to be applicable automatically beyond that time.

Purpose of sunset clauses 

The sunset clause serves several purposes. The benefits of the sunset clause are: 

1. It helps to specify the time-bound nature of laws, statutes, or rules. Without a similar clause in any legislation or policy, it will be difficult to measure or determine how long the law or rule can remain valid or enforceable. 
2. A sunset clause establishes and reiterates a basic principle of good jurisprudence regarding the periodic evaluation of legislation. Every rule, law, or statute derives its applicability and practicality from a specific social, economic, and political reality. Any change in those underlying contexts warrants a re-evaluation of the legislation. 
3. A sunset clause protects citizens from necessary but draconian legislation by nullifying it automatically after a pre-specified time. This helps restore citizens’ confidence in legislative practices. 
4. It helps practice caution during emergency legislation. It may not be possible to follow the best practices while legislating a law to tackle an emergency. This can cause an oversight of negative impacts. A sunset clause provides an option to limit the effects of such oversights.  

Example of sunset clause 

The inclusion of sunset clauses is a common practice in policy-making and legislation across countries and has been in place since ancient times. Some of the prominent examples of sunset clauses globally are: 

India 

Article 334: One of the prominent examples of sunset clauses in India is Article 334 of the Indian Constitution. Parliamentary and assembly constituencies are often reserved for representation from particular disadvantaged segments of the Indian population, like scheduled castes, scheduled tribes, and women. The sunset clause in Article 334 limits the duration of such reservation to a maximum of 10 years.  

Permanent Settlement Act of 1793: This infamous law allowed permanent settlement rights over lands to landlords (zamindars) based on a permanent arrangement for the sharing of rents collected from the land. The sunset clause in the Act provisioned cancellation of a landlord’s settlement right if he failed to collect and deposit the rent to the government treasury within a pre-specified date.    

Special Economic Zones Act, 2005: As per the sunset clause in this Act, tax benefits to developers of SEZ ended on March 31st, 2017, and for occupiers the tax benefits ended on March 31st, 2020.  

USA  

Article I, Section 8: This article in the American Constitution enumerates the legislative powers of the United States Congress, like recruiting, raising, and organising armies to protect the security and sovereignty of the nation. However, the sunset clause in Section 8 limits this power to a maximum period of 2 years. 

USA Patriot Act: This Act gave federal agencies the power to wiretap, trespass on computer communication, seize voicemail messages, and many more, with serious potential for privacy violations. A sunset clause in the Act sets the deadline for such powers for the agencies on March 15, 2020. On that date, the House of Representatives refused to vote and left the chamber, triggering a sunset or automatic revoking of these provisions in the Act. 

Australia

Laws under anti-terrorism acts legislated in Australia since 2005 include sunset clauses of 10 years. 

Types of sunset clauses 

Based on applicability, sunset clauses can be categorised into three broad types: 

• Fixed-term sunset: Any legislation with this type of sunset clause has a fixed expiration date. 
• Conditional sunset: In such cases, the expiration or sunset of a law depends on certain conditions attached to the law. A common example is environmental law. Such laws are conditional on achieving pollution reduction targets within a pre-specified time limit. If achieved, restrictions as per such laws may cease to exist.    
• Review-based sunset: This type of clause pre-specifies a date for reviewing the performance of the underlying legislation. 

Best practices for designing sunset clauses

A sunset clause is a practical tool for effective legislation and review of any law, rule, or statute. However, it is important that lawmakers follow certain guidelines when designing a sunset clause for a particular piece of legislation.  

• Drafting of the clause: It is important to draft the regulatory text around the clause with sufficient clarity and certainty. 
• Substantive scrutiny of the clause: Lawmakers must build a framework to ensure a substantive and meaningful review in a time-bound manner.  
• Explicit mention of the time of the review: The time of review should not be questionable. 
• Authority to review the clause: The clause must explicitly delegate the authority of the review to a specific body of competent reviewers. 
• Procedure of review and revoking: A sunset clause must clearly provision the procedure of review and revoking of the clause.