digital competition: New law on digital competition likely to regulate Big Tech

digital competition: New law on digital competition likely to regulate Big Tech

New Delhi: The government could bring in a specific digital competition law to regulate big tech, said people aware of the matter. The corporate affairs ministry is mulling separate legislation instead of tweaking the existing Competition Act, which was amended recently, they said.

“Given the complexity of the issue and differing views of stakeholders, introducing a bill to this effect will take time. It will be a new law, so it will take some time,” said one of the persons, who did not wish to be identified.

The government is not in a hurry to bring in a law on digital competition for the sake of it, the person said, adding that it intends to bring a law after comprehensive deliberations.

“Even in countries like the UK and the US, the idea of a law to regulate large digital players has been under discussion for some time,” said the person.

An official committee under corporate affairs secretary Manoj Govil – set up to examine the need for any ex-ante regulatory mechanism for digital markets through a separate law and to study international best practices, among others – is set to complete the initial drafting of its report this month.

It has concluded stakeholder consultations, including with local startups and big global players such as Apple, Amazon, Google, Meta and Twitter.

Large global technology companies have reportedly opposed the idea of ex-ante regulations in India.

The report is expected to form the basis of the government’s next course of action.

A second person said the extant Competition Act has already been amended this year to enable it to address contemporary issues and tackle fair trade concerns cutting across sectors.

“So, there is no need to amend the existing Act again,” he said. “The new law is expected to complement the existing Competition Act.”

ET had earlier reported that the government panel was likely to endorse ex-ante regulations and recommend “dos and don’ts” for systemically important digital intermediaries (SIDI). However, smaller digital firms will be kept outside the new regime’s ambit.

The panel is likely to define SIDI based on a set of criteria, including the nature of business, turnover and user base (both global and local), according to people in the know.

The panel’s report will factor in the recommendations made by the stakeholders and the December 2022 report of the parliamentary standing committee on finance, in addition to its own inputs.

The parliamentary committee, headed by former minister of state for finance Jayant Sinha, had suggested the need for a separate digital competition law.

Some large technology players such as Google, Apple and Facebook face probes by the competition regulator for possible abuse of fair-trade rules.

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