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MeitY meets firms to review concerns on Digital Competition Law

3 weeks ago 49

Indian policymakers Tuesday met industry representatives on the impact of the proposed Digital Competition Bill on data and digital markets after stakeholders seemed to have widely different opinions on the regulations, with some backing its provisions that others believe could deter investments.

Nine industry associations and representatives of government bodies, besides executives from some companies, were present at the MEITY meeting, sources said.

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Among those who attended were the Internet and Mobile Association of India (IAMAI), MakeMyTrip, Alliance of Digital India Foundation (ADIF), Federation of Indian Fantasy Sports, Cyber Cafe Association of India (CCAOI), INSA and the Digital News Publishers Association. Members from the Competition Commission of India (CCI) and ministry of corporate affairs (MCA) attended the meeting as observers.

Industry body IAMAI argued that the proposed law will be a long-term deterrent to investment.

"The digital industry can't sustain dual laws: a Competition Act and the proposed ex-ante law, which is unfair. The definition of SSDE includes virtually all companies which is an overreach. The current Bill is not going to solve the revenue sharing issue. There are some genuine problems between platforms and BigTech, which needs to be sorted out with amendments in current laws like the current Competition Act and IT Act,” Subho Ray, president, IAMAI, told ET.

At the meeting, ADIF supported the digital competition bill.

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Prateek Jain, associate director for startups and alliances, ADIF, told ET, "The legislation strikes the right balance between promoting innovation and ensuring fair competition. This framework will empower homegrown innovators, safeguard consumer interests, and foster an environment conducive to sustainable growth."

However, a MakeMyTrip spokesperson told ET that the proposed ex ante legislation in its current shape and form is not required and needs to be relooked at.

The Committee on Digital Competition Law in a report published on March 13 had proposed a new Digital Competition Act (draft Digital Competition Bill) to deal with nine anti-competitive practices by technology companies.

The MCA had sought comments before April 15. The report had said SSDEs will be determined based on turnover, gross merchandise value, and market cap thresholds.

Moreover, these SSDEs can be designated only for identified core digital services like search engines and social networking.

If a SSDE doesn’t self-report its SSDE status to the CCI based on quantitative factors, it can get a penalty of up to 1% of its global turnover. Engaging in the listed anti-competitive behaviour, including trying to circumvent higher obligations, can attract a penalty of up to 10% of its global turnover.

CCAOI argued that the proposed law is not about BigTech versus Indian businesses and that it requires thorough reassessment of the need for it, its criteria, considering Indian sensitivities and aspirations of a trillion-dollar economy.

Reassess the list of core digital services as all may not be harmful, not all forms of data sharing and cross marketing is bad, it argued. Many MSMEs and SMEs rely on BigTech for growth and that should not be forgotten, it said.

Amrita Choudhury, director, CCAOI, told ET, “India’s aspirations are quite different from that of Europe. Just like we have Amazon and Google Pay, we also have PhonePe which is an Indian company. So, our dynamics are slightly different. Similarly, the threshold of SSDEs needs to be looked at. MSMEs may not have grown globally if not for BigTech.”

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