MeitY discusses draft Digital Competition Bill with stakeholders
The Digital Competition Bill was released for public consultation in March and the consultation ended on May 15.
The ministry of electronics and IT on Tuesday held a meeting with industry lobby groups to discuss issues related to the impact of the draft digital competition bill (DCB) that seeks to prescribe certain anticompetitive practices of Big Tech firms as illegal through ex ante regulation.
The ministry was trying to formulate its position on the draft bill so that it can give its inputs to the corporate affairs ministry, said IT secretary S Krishnan, who chaired the meeting, according to three people who asked not to be named.
The hour-long meeting, which is expected to be the first of many, was held after MeitY received multiple representations from industry associations “raising serious concerns regarding the impact of the proposed Bill on data and digital markets”, according to the invitation for the meeting. MeitY is also scheduled to meet a handful of think tanks on Wednesday to discuss the issue.
The meeting was attended by officials from the IT and corporate affairs ministries and Competition Commission of India (CCI), and representatives of the Alliance of Digital India Foundation (ADIF), Federation of Indian Fantasy Sports (FIFS), Digital News Publishers Association (DNPA), Indian Newspaper Society (INA), Internet and Mobile Association of India (IAMAI) and Cybercafes Association of India (CCAOI)
The Digital Competition Bill was released for public consultation in March and the consultation ended on May 15. It was drafted by a committee constituted by the corporate affairs ministry in February 2023 on the recommendations of the parliamentary standing committee on finance, then headed by Jayant Sinha.
In the meeting, ADIF voiced its support for the proposed law, saying it would help rein in Big Tech companies. DNPA, whose submissions to the information and broadcasting ministry and the Prime Minister’s Office had prompted the former to convene an interministerial meeting on the issue of revenue sharing between Big Tech companies like Google and Meta, and news publishers on June 12, spoke on the need for the draft law to include a bargaining code, akin to Australia’s News Media Bargaining Code and Canada’s Online News Act.
DNPA had made a similar submission to the committee constituted by MCA and said that a “pre-facto bargaining code be put in place to eliminate the power imbalance between large digital enterprises and news publishers”. The committee, however, had rejected the suggestion on two grounds: first, the DCB does not seek to govern contractual agreements between two parties; and second, CCI’s powers could not extend “to interference in contractual matters between two parties”. It had also said that unlike the remit of the Australian Competition and Consumer Commission (ACCC), CCI’s remit was limited to enforcement of competition law in India. It had said that an issue like the bargaining code should be addressed by a sectoral regulator such as the MIB.
The industry representatives from DNPA and INS said that any antitrust regulation must cut across sectors. In the meeting, DNPA said the news industry wanted a solution to the imbalance in bargaining power between local publishers and Big Tech companies.
DNPA and INS said that digital news publishers are stakeholders with MeitY as they operate within the digital space even as the nodal ministry for them is the MIB.
IAMAI, reiterating its submission to the MCA, opposed ex ante regulation and held that such a law would stifle long-term investments in India. The bill, meant only for digital markets, would impose double regulation on such companies while other markets will continue to be governed only by the Competition Act. It also said that the issues around revenue sharing could not be solved using ex ante regulation.
IAMAI and MakeMyTrip said that the thresholds for systematically significant digital enterprises (SSDE) need to be re-examined. Under the Bill, SSDEs will be designated by the CCI, depending on either quantitative or qualitative factors such as turnover, size, user base and market power.
MMT said that the thresholds for designating SSDEs need to be different for Indian and foreign companies. MMT said that the proposed thresholds for designating an SSDE — a turnover of at least ₹4,000 crore in India, or a global turnover of at least US$30 billion – were unfair. The online travel angency also said that only those Big Tech companies where the “winner takes all” need to be regulated.
The CCAOI held that no new regulation was required and the Competition Act should be amended to deal with related issues. The Bill needed to be harmonised with other digital laws, its representative said.
The CCAOI also submitted that issues related to revenue sharing and commission charged by app stores did not need a separate regulation. The representative said that the DCB has set up Indian and foreign companies as rivals even though a lot of Indian MSMEs depend on foreign Big Tech companies for their growth. This person said that the the list of “core digital services”, as listed in the Bill, needs to be revised.