The release of the draft Digital Competition Bill has stirred controversy over the extent of governmental control and intervention in regulating competition in the digital sphere. Much like previous instances such as the Digital Personal Data Protection Act, where the government retained significant powers, the draft bill empowers the Centre to supersede decisions of the Competition Commission of India (CCI) and exempt enterprises from its provisions.
Outlined in the draft bill, the government reserves the authority to grant exemptions to enterprises in the interest of national security, treaty obligations, or other unspecified reasons. Additionally, it can intervene in extraordinary circumstances to override CCI decisions if deemed necessary.
The proposed legislation imposes stringent obligations and penalties on Systematically Significant Digital Enterprises (SSDEs) to curb anti-competitive practices. However, concerns arise over the broad discretion afforded to the government in granting exemptions and superseding CCI decisions.
Under Section 38 of the bill, the Centre can exempt enterprises from the application of certain provisions for specified periods, potentially impacting the enforcement of competition regulations.
Furthermore, Section 40 grants the government powers to supersede the CCI in exceptional situations where it deems the regulator incapable of fulfilling its functions effectively. Such interventions could lead to the removal of CCI officials and disruptions in the regulatory process.
Legal experts caution against unchecked executive authority, citing constitutional principles of oversight and accountability. The Supreme Court’s ruling in the Satwant Singh Sawhney vs D Ramarathnam case underscores the need for constitutional scrutiny of governmental powers, particularly in matters of regulation and control.
While proponents argue that such provisions may facilitate ease of doing business, there are calls for clearer guidelines and parameters to ensure judicious application and prevent potential abuse of power.
Saksham Malik, senior programme manager at The Dialogue, highlights the need for clarity on the factors guiding governmental discretion, particularly concerning exemptions. Vague terms like ‘public interest’ and ‘sovereign function’ necessitate further delineation to prevent ambiguity and misuse of authority.
As the draft bill undergoes consultation, stakeholders advocate for robust safeguards and transparency measures to uphold competition principles while fostering innovation and growth in the digital economy.
