A parliamentary panel recommended the government enact a digital competition act to regulate anti-competitive business practices by Big Tech companies.
The Parliamentary Standing Committee on Finance stressed the need for a new Digital Competition Act to prescribe a code of conduct for tech giants so that they do not stifle competition with their market power.
The committee led by BJP’s Jayant Sinha listed a set of undesirable practices observed in the digital economy and said that a code of conduct-based approach was needed for digital market winners called digital market gatekeepers.
The panel flagged practices such as e-commerce platforms pushing their own private labels over third-party brands sold in the platform, using customers’ personal data to get ahead of the competition and bundling different products and services.
The report, titled “Anti-competitive practices by Big Tech companies”, was tabled in the Parliament last week on Thursday to “ensure a fair, transparent and contestable digital ecosystem, which will be a boon not only for our country and its nascent start-up economy but also for the entire world,” the panel said.
India’s proposed Digital Competition Act loosely follows the EU’s Digital Market Act which mentions “gatekeepers” who will enforce rules and regulations ex-ante to foresee anti-competitive practices.
The move comes at the heels of the Competition Commission of India (CCI)’s move, in October, to impose a penalty of ₹1,337.76 crore on Google for abusing its dominant position in the android mobile device ecosystem.
The CCI, under the Indian Competition Act 2002, was established to protect and promote competition in markets, and prevent practices that hinder competition. The Act however failed to consider the dominant role of Big Tech companies at that time. The European Union, the United States, and Australia have transformed their competition law as the market dominance of Big-Tech companies increases exponentially.
