The US-India Business Council (USIBC), representing major tech players like Google, Amazon, Apple, Meta, and Walmart, has voiced its concerns over the draft Digital Competition Bill proposed by the committee on digital competition law (CDCL). In a letter addressed to the Ministry of Corporate Affairs (MCA), the USIBC urged for a reconsideration of the bill, drawing comparisons to the European Union’s (EU) Digital Markets Act 2022 and highlighting its broader scope.
Concerns Raised by USIBC
The USIBC expressed apprehensions that the proposed restrictions on tech players outlined in the draft Bill could potentially escalate costs for end users. The council argued that targeted companies may scale back investments in India, leading to increased prices for digital services and a reduction in service offerings.
Intent and Scope of the Draft Bill
The draft Digital Competition Bill aims to address alleged anti-competitive practices among major tech companies and other systemically significant digital enterprises (SSDEs). By introducing measures to promote fair competition, the bill seeks to democratize the digital space in India, where US-based tech giants hold significant market shares.
Proposed Obligations for Tech Behemoths
To ensure fair competition in the digital market, the draft Bill proposes various obligations on tech giants, including compliance with fraud prevention, cybersecurity, trademark, and copyright infringement laws, as well as adherence to local regulations. Additionally, the bill defines SSDEs based on criteria such as global market cap, turnover, and user base.
Opposition and Support
The USIBC’s opposition to certain provisions of the bill echoes earlier concerns raised by the Internet and Mobile Association of India (IAMAI), citing potential adverse effects on Indian startups and digital enterprises. However, the bill allows for exemptions for certain enterprises, and around 40 Indian startups have expressed support for its implementation.
Response from Indian Startups
Several Indian startups, including Matrimony.com, TrulyMadly, and Innov8, have voiced their support for the Digital Competition Bill. In a letter to the corporate affairs ministry, these startups highlighted the need for regulations to address practices that may stifle innovation and limit consumer choice, particularly by dominant tech players.
Strengthening Regulatory Framework
In addition to the proposed measures outlined in the draft Bill, it also aims to enhance the powers of the Competition Commission of India (CCI) to ensure early detection and resolution of cases related to digital competition. This comes at a time when several big tech companies are facing scrutiny from the CCI for alleged violations of Indian laws.
The debate surrounding the Digital Competition Bill reflects the evolving landscape of digital regulation in India. While concerns have been raised by major tech conglomerates, the proposed bill has garnered support from a significant portion of the Indian startup ecosystem. As discussions continue, the bill’s implementation may play a crucial role in shaping the future of competition in India’s digital economy.
