Govt to seek House nod to Competition Bill in Budget session

MCA to start consultations on standing committee report on Big Tech regulation

Budget 2023, India
The Union Budget will be presented in Parliament on February 1.

The government will seek passage of the Competition (Amendment) Bill in the Budget session of Parliament, taking into account the recommendations of the Standing Committee on Finance. The Bill  proposes to regulate mergers and acquisitions based on the value of transactions and thereby bring more deals, particularly those in the digital space, into the CCI’s regulatory ambit.  

The ministry of corporate affairs is also likely to start consultations on the report of the Parliamentary panel on regulating Big Tech firms soon, but the proposal for a Digital Competition Law could take some more time, a ministry official said.

“The government is examining the report of the Standing Committee on the Competition (Amendment) Bill. It will try and take it forward in the Budget session,” said the official.

As per the Bill, deals with transaction value above `2,000 crore will require CCI’s prior approval.  The Bill also proposes to reduce the timeline for the regulator to pass orders on such transactions from 210 days to 150 days, besides expanding the scope of entities that can be adjudged to be part of anti-competitive agreements by including enterprises or persons not engaged in similar businesses.

According to another source, the ministry has begun work on the recommendations of the Bill and the government is likely to take forward key suggestions of the panel, including an annual review of the deal value threshold of `2,000 crore.

The CCI’s powers to regulate transactions of Big Tech are expected to get significantly expanded with the passage of the Competition Amendment Bill. The official quoted first also pointed out that the Bill also proposes to expand the eligibility criteria of the chairperson and members of the CCI by including those with at least 15 years of professional expertise in the sector of technology. This would ensure that the CCI have the understanding and expertise in the IT and tech sector that would help it look into such companies.

At present, the positions are open to persons with professional experience of not less than 15 years in sectors, including international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs or competition matters.

The official said the government will soon start examining the report of the Parliamentary Panel on anti-competitive behaviour of Big Tech firms. The panel, chaired by Lok Sabha MP Jayant Sinha suggested a number of measures including ex-ante evaluation of their activities, a separate Digital Competition Act and imposition of reporting requirements on “leading players” which are potential threat to competition.

“The report has a number of recommendations that would impact players and stakeholders across a number of sectors. It requires wider consultation and work on that will start soon. The recommendation for a Digital Competition Act will also be examined but it is too early to give a timeline on when it will be taken forward,” said the source.

The move comes at a time when there are increasing concerns over how Big Tech functions in the country. Google has filed an appeal in the Supreme Court after the NCLAT declined to grant a stay on the CCI’s `1,337.6 crore penalty and directions against the tech major for abusing its dominant position in multiple markets in the Android mobile device ecosystem.

However, industry association Asia Internet Coalition has expressed concerns that the digital competition law may dampen digital innovation in India. “We urge the government to conduct wider stakeholder consultations to ensure that any new legislative proposals meet international best practices, are evidence-based, and are for the purpose of benefiting innovation, growth, and consumers,” it said in a statement, adding that the Digital Personal Data Protection Bill and the Competition Amendment Bill both seek to protect consumers, preserve competition and promote tech innovation, with a special focus on digital markets.

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First published on: 11-01-2023 at 01:00 IST
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