SUMMARY
The panel working on the new law is likely to propose that all digital companies with 10% business transactions in India should be covered under the law
Tech firms that have a turnover of over INR 2,000 Cr in India are also likely to be brought under the law, irrespective of whether they fulfill the other criteria
The CCI last year constituted a 10-member committee to review the existing competition norms and examine the need for a new legislation to control digital entities
The proposed digital competition law in the country is likely to bring big tech players under its ambit in a bid to address antitrust concerns about big digital intermediaries.
As per a report by ET, the panel working on giving recommendations for the digital competition law is likely to propose that all digital companies which have 10% of their global user base or business transactions in India should be covered under the law.
It is pertinent to mention that the Competition Commission of India (CCI) last year constituted a ten-member committee, chaired by corporate affairs secretary Manoj Govil, to review the existing competition norms and examine the need for a new legislation to control digital entities.
Tech firms that have a turnover of over INR 2,000 Cr in India are also likely to be brought under the law, irrespective of whether they fulfill the other criteria, the ET report said. However, smaller firms are likely to be kept out of this regime in order to not hinder innovation.
“A key factor in selecting the digital entities that will be covered under the new law will be their substantial business operations,” a source was cited as saying.
The panel, working on suggestions to prevent abuse of dominance, will suggest measures to ensure neutrality of digital platforms and no search engine bias, the report said.
The panel’s suggestions will be submitted to the finance ministry and the ministry of corporate affairs and are expected to form the basis for the new digital competition law. However, the final bill would be finalised by the corporate affairs ministry after taking into consideration the inputs received from other departments.
It is worth mentioning that the CCI formed the panel to examine the need for a new law after the Parliamentary Standing Committee on Finance asked the Centre to bring in a new digital competition law to reign in big tech players.
Big tech players like Google, Apple, and Facebook have been under regulatory scrutiny in India for some time for allegations of abuse of their dominance and following anti-competitive business practices. In 2022, the CCI slapped fines on Google in two separate antitrust cases, while Apple has been under the lens for its app store billing policy.
Indian startups are among the biggest critics of big techs, accusing them of violating the country’s rules and abusing their market dominance.
