The policy of a bag is set or edited when editing a bag either via twanager or using the HTTP API.

The bag command of twanager takes a bag name as an argument and an optional JSON string representing a policy:
twanager bag foobar
{"policy": {"read":["someusername"]}}
^D


PUT to /bags/{bag_name} is much the same: the JSON representation must include a policy element.

In either case, if the bag already exists, the bag's current policy is clobbered by the new one provided.