In a significant move aimed at enhancing regulatory oversight, and ensuring compliance, the Competition Commission of India (CCI), has proposed new regulations to monitor the settlements, and commitments of industry giants.
The CCI’s newly issued consultation paper, and draft regulations, promises to usher in a new era of transparency, and accountability for the technology sector.
The CCI’s draft regulations, has introduced a comprehensive framework, for the appointment of independent agencies to oversee the implementation of the Commission’s orders.
This move, aims to ensure that industry giants adhere to their commitments, and do not exploit loopholes to evade regulatory scrutiny, sources said.
Independent agencies to monitor compliance
The proposed regulations, empower the CCI to appoint a range of independent agencies, including accounting firms, management consultancies, professional organisations, and individuals such as chartered accountants, company secretaries, and cost accountants. These agencies will be tasked with the critical responsibility of monitoring the implementation of the CCI’s orders, ensuring that the terms of engagement are strictly followed.
To maintain integrity, and impartiality, the agencies must confirm their independence, from the parties involved, and disclose any potential conflicts of interest. This measure, is designed to prevent any undue influence, and ensure unbiased monitoring of compliance.
Key responsibilities of monitoring agencies
The agencies appointed under the new regulations, will ensure that the orders of the Commission are implemented, inform the CCI of any instances of non-implementation or non-compliance with the orders, and adequately disclose any direct, or indirect pecuniary or non-pecuniary interest, that could prejudice their performance, and submit periodic reports, related to the monitoring of order implementation, as directed by the Commission.
Additionally, the agencies shall maintain the highest standards of confidentiality, regarding any information received, or collected, during the discharge of their obligations, and will perform any other duties as stipulated under the terms of engagement, or as directed by the Commission.
In an added layer of accountability, the CCI retains the authority, to suspend or terminate the engagement of these agencies if they fail to meet the stipulated standards. This can be done in accordance with the terms of their engagement, or, if deemed necessary by the Commission, for reasons recorded in writing. Importantly, any such revocation by the CCI, cannot be challenged in any court of law or otherwise, ensuring swift, and decisive action.
The proposed regulations, stipulate that the payment to the monitoring agencies, will be made by the person who has filed an application, under the relevant regulations of the Competition Commission of India (Settlement) Regulations, 2024, or the Competition Commission of India (Commitment) Regulations, 2024. In cases where the application is filed under the Combination Regulations, or any other relevant regulation, the payment responsibility will lie with the appropriate person as directed by the Commission. This ensures that the financial burden does not fall on the regulatory body, but on the parties seeking settlement or commitment.
Implications for big tech
These proposed regulations, signify a landmark shift in how regulatory compliance will be monitored in India, particularly for the technology sector. By instituting a robust, and independent monitoring mechanism, the CCI aims to prevent big tech firms, from circumventing regulatory orders, and ensure that they adhere to their commitments in letter and spirit.
The CCI’s move to tighten oversight through these new regulations, is expected to set a new benchmark in regulatory enforcement. With the implementation of these regulations, the CCI aims to ensure greater transparency, accountability, and compliance in the tech industry, thereby reinforcing its role as a vigilant watchdog in the evolving market landscape.