Big Tech firms including Google, Meta and Amazon on Saturday made elaborate presentations to the MCA-appointed Committee on Digital Competition Law on how the proposed Digital Competition Act should be fashioned.

This is the first occasion when Big Tech firms are making their submissions after the panel was constituted on February 6 to study the need for an ex-ante framework in the country, international practices on the subject, and the existing legal framework. It has been mandated to submit a report by May 2023 and also submit a draft of the Digital Competition Act.

Flipkart, Zomato, Uber and National Restaurant Association of India (NRAI) were among the others who made submissions to the panel on Saturday, sources said. 

Not in favour

Broadly the Big Tech players are not in favour of government bringing ex-ante measures in the statute book, but the start-ups (homegrown ones) are really keen that the ex-ante framework be introduced to protect the interest of the domestic start-up ecosystem.

Meanwhile, ahead of the crucial meeting on Saturday, the Corporate Affairs Ministry (MCA)-appointed panel on Digital Competition Law acceded to the demands of news publishers and start-ups, roping them as ‘special invitees’ to the deliberations of this committee.

Representatives of Big Tech like Google, Meta and Amazon made their presentations/submissions as ‘special invitees’ to the panel.

Both Digital News Publishers Association (DNPA), a body representing digital news publishers, and Alliance of Digital India Foundation (ADIF), a think tank of digital start-ups, participated in Saturday’s meeting as ‘special invitees’, sources familiar with developments said.

It maybe recalled that both DNPA and ADIF have been pitching for their inclusion in the MCA-appointed panel, which currently seems imbalanced with a dominant presence of law firms representatives, many of whom are currently representing Big Tech before NCLAT. In fact, the MCA had recently added two more law firms (representing Google in cases before NCLAT) to the panel as invitees, drawing the ire of start-ups and digital news publishers who were left out.

Now with the inclusion of DNPA and ADIF as ‘special invitees’, there is some levelling of the field, sources added. The government as part of vision for Digital India expects the digital economy of the country to touch $ 1 trillion by 2025-26.

The MCA had on February 6 constituted a 10-member inter-ministerial committee to examine the need for a separate law on competition in digital markets. The panel had been among other things tasked to prepare a draft Digital Competition Act.

Terms of reference

The panel’s terms of reference include a review as to whether existing provisions of the Competition Act 2002 and the rules and regulations framed thereunder are sufficient to deal with the challenges that have emerged from the digital economy and to examine the need for an ex-ante regulatory mechanism for digital markets through separate legislation.

The Standing Committee on Finance had in its 53rd report titled ‘Anti- competitive practices by big tech companies’ suggested an ex-ante framework to regulate ‘Systemically Important Digital Intermediaries’ (SIDIs) under a new Digital Competition Act.

This signals a new era of ex-ante frameworks, meant to cover only SIDIs in digital markets, marking a significant exit from the existing sector-agnostic framework which covers all market players, said competition law experts.

It is crucial to analyse the objectives that policymakers seek to achieve by introducing ex-ante regimes, the challenges that may be associated with these frameworks and international guidance on the subject. Further, it is necessary to discuss the implications of these frameworks for the start-up economy, facilitation of competition at downstream levels, catalysing innovation, and ensuring the protection of consumer interests, they said.

Meanwhile at a round table discussion hosted by public policy think tank The Dialogue on the topic of ‘Future of Competition Policy in Digital Markets’, the significance of achieving a balance between regulating anti-competitive conduct in digital markets and preventing overregulation and harm to innovation and consumer interests was highlighted.

At the Round Table discussions, moderated by OECD Competition Committee Chairman Frederic Jenny, it was emphasised that all potential issues pertaining to the impending Digital Competition Act should be analysed in the context of the effects that the regulations will have on crucial stakeholders such as start-ups, consumers, and investors through extensive consultation.

Indian economy has been able to attract investments and maintain its position as one of the most promising economies. The growing importance of competition law in the growth of the Indian economy and the policy landscape is at an inflection point with an increased emphasis on the role of the law in regulating India’s business and tech ecosystem.