Corporate Law

Rethinking Commercial Surrogacy: From Criminalization to a Contractual Solution

Anmol Jain and Aditya Saraswat

Bringing escrow agreements to rescue affected surrogates instead of creating more crime


It would not be wrong to state that the last winter session of the 16th Lok Sabha has been quite a roller-coaster ride. It has seen forceful arguments, astonishing debates amid regular disruptions and walkouts, with allegations and counters from every faction of the house on certain important and crucial issues. These include the Rafale deal; the law criminalizing triple talaq; the passing of the Citizenship (Amendment) Bill, 2019 seeking to provide Indian citizenship to non-Muslims moving out from Pakistan, Afghanistan and Bangladesh; and the law provisioning 10% quota for economically poor among the general category citizens, et al.

One such important event was the passing of Surrogacy (Regulation) Bill, 2016 [“the Bill”] by the Lok Sabha on December 19, 2018. The Bill is the result of a long-pending demand from civil society to regulate commercial surrogacy that has seen various instances of physical and economic exploitation of surrogate mothers, who normally hail from lower income families. One must note the 228th Report of the Law Commission of India, which had recommended the prohibition of commercial surrogacy after acknowledging the complexities found in the law.

Prior to the introduction of the bill, multiple attempts to regulate surrogacy were made, but to no avail. One of the earliest attempts was the introduction of Assisted Reproduction Technologies (Regulation) Bill, 2008 by the Indian Council for Medical Research, modified in 2010. In the Lok Sabha, Dr Kirit Premjibhai Solanki and Shri Bhartruhari Mahtab made the initial attempts by introducing the Surrogacy (Regulation) Bill, 2014 in the form of two private members’ bills, the first in August 2014 and the second in November. Recognizing the importance of surrogacy, neither of these bills envisaged a penal ban on commercial surrogacy. The Law Commission, at ¶1.2, has also acknowledged, “Infertility is seen as a major problem as kinship and family ties are dependent on progeny, herein surrogacy comes as a supreme saviour”.

The present Bill, drifting away from all its previous versions, is enacted to primarily ban commercial surrogacy, and additionally, to constitute national and state level surrogacy boards for the regularization of altruistic surrogacy. To clarify the difference between the two, Section 2(b) of the bill defines altruistic surrogacy as:

the surrogacy in which no charges, expenses, fees, remuneration or monetary incentive of whatever nature, except the medical expenses incurred on surrogate mother and insurance coverage for the surrogate mother, are given to the surrogate mother or her dependents or her representatives.”

On the other hand, Section 2(f) defines commercial surrogacy as commercialization of the surrogacy services by way of giving monetary payment in addition to medical and insurance charges to the surrogate mother for the rendered services.

Generally, the argument made in favour of banning commercial surrogacy is that it translates to selling or buying of embryos and might lead to the commodification of women. [102nd Report of the Parliamentary Standing Committee on Health and Family Welfare, Rajya Sabha. (Aug 2017), ¶4.9]. Additionally, as most of the women who serve as surrogates in India come from the poor strata of the society and are prone to physical and economic torture, it has been argued that it would be better if the government provides them education, training, and jobs rather than allowing them to earn money by “renting out their wombs”. [Rajya Sabha, ¶4.2].

This being the premise of the Bill, we will now explore its lesser-discussed provisions. We will argue that these provisions are problematic, and present an alternative regulatory mechanism for commercial surrogacy.

Section 35 of the Bill enlists certain kinds of conduct from clauses (a) to (f), which includes advertising or undertaking commercial surrogacy, and punishes such conduct with minimum imprisonment of 10 years, and with fine which may extend to ten lakh rupees. Ironically, the intending couple and the medical practitioner involved shall be punished with a lower punishment that shall not be less than five years, and with fine which may extend to five lakh rupees [Sections 36 and 37]. Further, Section 2(g) defines ‘couple’ eligible for altruistic surrogacy and restricts it only to a union of a man and a woman, and thus excludes same-sex couples and single parents from its purview. If we compare this to the legal regime prevailing in the United Kingdom or Russia, being married is not a pre-condition to opt for surrogacy in the first place. Furthermore, Section 4(ii)(a) of the Bill restricts surrogacy to only those couples where one of the partners is proved infertile. Therefore, suffering from any other medical condition such as AIDS, congenital absence of uterus or inability to bear a child would not warrant surrogacy as an option. Therefore, we argue that the bill is laden with numerous regressive provisions, which should be reviewed urgently.

Not only are the provisions regressive, but the bill also leads to multiple harsh consequences. Penalizing commercial surrogacy brings with itself the possibility of a black market and transportation of women abroad for such services [Rajya Sabha, ¶¶ 4.12, 5.10]. The impact of this possibility is high given the fact that about 10-15% of Indian couple are infertile, which amounts to around 27.5 million couples. [Rajya Sabha, Annexure IV].

It has been argued that allowing only altruistic surrogacy might put undue pressure on the close relatives for undergoing the emotional and the physical trauma as all the family members may not be able to resist such a demand [Rajya Sabha, ¶5.8]. Moreover, on a general observation, altruistic surrogacy might lead to a conflict of interests regarding the custody and motherhood of the child between the relative acting as the surrogate mother and the intending couple [Rajya Sabha, ¶4.1]. Surrogacy shall also demand the surrogate to drop out of any of her jobs and disable her to commit herself completely towards her own family [Rajya Sabha, ¶5.19].

These apprehensions only contribute to the rapid development of commercial surrogacy as an industry, which is already growing at a fast pace and has been recorded to be worth $2 billion per year by the Confederation of Indian Industry in a 2012 study. The statistics become significant, given the growing number of nations prohibiting commercial surrogacy, which might further expand medical tourism in India and enable the surrogates to earn a good standard of living for their families.

Considering the entirety of the circumstances, facts and probabilities, we argue that commercial surrogacy does not warrant criminalization but a comprehensive regulatory mechanism. Before moving on to suggest an alternative regulatory mechanism, we shall reflect on the constitutional challenge to the bill.

Article 19(1)(g) ensures to all citizens a right to practice any profession or to carry on any occupation, trade or business. However, this is not an absolute right, and Article 19(6) provides certain grounds on which it can be reasonably restricted, such as ‘in the interest of the general public’, which is relevant in the present context. Thus, to be a constitution-compliant law, the Surrogacy (Regulation) Bill, 2016 has to present itself in the ‘interest of the general public’, but it fails.

The Supreme Court of India, in Chintaman Rao v. State of MP [AIR 1951 SC 118], has confined the scope of rather generally worded restrictions of Article 19(6) while stating that the phrase ‘reasonable restriction’ warrants a restriction dictated by reasons in the interest of the public. Therefore, the Legislature is required to strike a proper balance between the freedoms guaranteed under Art. 19(1)(g) and the social control permitted by clause (6) of Art. 19. Following the same logic, the Supreme Court had held that a total ban on dance performances in certain eating houses was far in excess of what is required and thus, unconstitutional. [State of Maharashtra v. Indian Hotel and Restaurant Association, AIR 2013 SC 2582].

Similarly, in the present matter, a reasonable restriction, guided by reasons, would have been an institutional arrangement regulating the surrogacy market. Criminalizing the practice completely negates the individual freedoms and fails to strike the mandatory balance required between individual freedom and social control. An individual is the best judge of his/her choice of business. Indeed the government possesses the power to regulate the affairs of the business but a blanket ban depicts its non-competency to protect the businesses from evil elements. In addition, allowing altruistic surrogacy is a self-evidence of the fact that the practice of surrogacy as such is not considered immoral by the civil society.

Escrow Arrangement: An alternative to criminalizing commercial surrogacy

The bill already provides for constitution of national and state level surrogacy boards. We propose that this setup be extended to district level and with the prime obligations of the district surrogate boards to (i) register competent surrogates, (ii) check that the surrogacy contracts are honoured, (iii) register and supervise the Assisted Reproductive clinics, and (iv) sue any intending couple on behalf of the surrogate who does not honour the surrogacy contract. In cases of altruistic surrogacy, the intending couple shall verify their close relation with the surrogate mother before the district surrogacy board as a pre-condition. Clarification: employing any unregistered surrogate or initiating the process without verification from the board, should be penalised.

One of the prime concerns raised by the supporters of the ban is that the intending couple does not make the payment after taking the services and in some instances, rejects to accept the surrogate child. To check such situations, a ‘standard surrogacy contract’ should be drafted by the concerned authorities, which shall be a four-party contract, obligating the intending couple to deposit a certain amount with the district board before using the services of the surrogates. It shall ensure that upon the completion of services, adequate monetary compensation is paid to the surrogate and on the other hand, if the surrogate does not deliver the custody of the child, the deposited amount can be returned to the intending couple.

With respect to the specifics of the deposit, it should include the price of the services rendered, medical expenses, insurance costs, social costs (cost of inability of the surrogate to commit herself completely to her family during the period of pregnancy) and psychological costs. The deposit should comprise of summation of the amount under each head, which shall be determined by the appropriate authority based on a generalist view (the minimum amount which is always spent in each case). Any additional expense shall be paid after the completion of the services.

Coming to the four-parties, they shall be: (i) the surrogate mother; (ii) the district surrogacy board; (iii) a representative of the intending couple; (iv) a nominee of the intending couple. The nominee shall have two primary responsibilities. First, acting in the capacity of a guarantor, s/he shall be liable to make any additional payment in a situation when the intending couple refuses or is incapable to do so. Second, acting in the capacity of a nominee as understood in the financial regulation laws, such as Section 45ZA of the Banking Regulation Act, 1949, s/he shall be entitled to accept the custody of the child if the intending couple refuses or is incapable to do so. For the want of security, the nominee is mandatorily to be an Indian national competent to contract. Clarification: The nominee can be an individual or a couple and it shall take the custody of the child as a legal guardian. Later on, the intending couple can claim the custody of the child with the permission of the District Court.

Further, to differentiate the domain of adoption and surrogacy, it should be made mandatory that one of the partners of the intending couple has to be the donor. Such donor shall be the only person to accept the custody of the child. Therefore, in cases of divorce while the services are taken, then the donor shall be obliged to accept the custody of the child; and in cases where both the partners are infertile, then adoption shall be the legal option.

Furthermore, as has always been followed under Indian law, there should be an automatic transfer of custody of the child from the surrogate to the intending couple. The law should not require a separate adoption agreement between the surrogate mother and the intending couple.


Surrogacy is a growing industry in India. Though we cannot overlook the evils of the industry, we also cannot ignore the high number of infertile couples in India and their wish to have a child of their own. This need is also reflected in the history of surrogacy regulation bills, which only provision for the regulation of the industry and not banning commercial surrogacy. Therefore, the authors urge that the alternative escrow arrangement, in form of a standard surrogacy contract under the supervision of the district surrogate boards, should be adopted by the Legislature.

Anmol Jain and Aditya Saraswat are third-year students of National Law University, Jodhpur

Image credits: IndiaMART.