Big Tech firms such as Apple, Google, Meta, Amazon and others have strongly opposed the recommendation by the parliamentary standing committee on finance for a digital competition law. These firms, through their association Asia Internet Coalition (AIC), have said that the finance committee’s proposal would restrict competition or innovation of digital ecosystems in the name of fairness.
Instead, AIC wants the government to conduct wider stakeholder consultations first, to ensure that new legislative proposals meet international best practices, are evidence-based, and are for the purpose of benefiting innovation, growth and consumers.
The statement from Big Tech companies assume significance, given the government is looking to revamp its regulatory framework with the changing technology landscape in the country. Currently, the government is working on four Bills namely – the telecom Bill, digital data protection Bill, the competition amendment Bill, and the digital India Act to protect consumer interest and push digital innovations. According to Big Tech companies, the government must first understand the impact of these Bills before introducing any further legislation.
“The report put forward by the Committee is prescriptive, absolutist and regressive in nature, incorporating proposals from the European Union’s (“EU”) Digital Markets Act (“DMA”),” AIC said, adding that the Digital Markets Act has been widely criticised for its provisions to restrict competition and innovation in the market.
Apart from drawing references from the DMA, the committee has also mentioned the American Innovation and Choice Online Act (AICOA) and the Open App Market Act (OAMA), which according to the tech companies, are against consumer interest, growth and innovation in the sector as well as have long transition and implementation periods.
“Transplanting legislative reforms designed for a foreign jurisdiction with high digital penetration into India, could lead to disproportionate costs to consumers in India and an impact on innovation and investment by businesses in India — especially at a time when the government is rightly focusing on bringing connectivity to all under the Digital India initiative,” AIC said.
Besides recommending a new competition law, the parliamentary committee made 14 recommendations to the government, including a revamp of the Competition Commission of India (CCI) and giving it more powers. The committee recommended that CCI should be given the authority to define Systemically Important Digital Intermediaries (SIDIs) based on revenue, market capitalisation, and number of end users.
In its report, the committee called these Big Tech companies as ‘gatekeepers’ owing to their nature of restricting the installation or operation of third-party applications and asked them to not indulge in self-preferencing, that is, favouring their own services above the competitors.