The recent controversy around Internet and Mobile Association of India (IAMAI) can be traced back to a leaked, draft document wherein it argued against the need for a separate digital competition law that would provide more guardrails in regulating Big Tech companies.
Now that the final version has been submitted to the Committee on Digital Competition Law (CDCL), how does the industry body justify its views? We take a look.
In its submission to CDCL, a copy of which Moneycontrol accessed, IAMAI firstly argues that there is no need for a separate digital competition law, as the current structure involving the Competition Commission of India has been "promptly looking into various digital competition issues".
"Additional regulation may be warranted only when there is evidence of failure of the existing regulatory structure. However, presently there is no empirical evidence of any such failure," the submission reads.
The industry body further said that there will be an impact on investment in start-ups due to size or scale-based applicability of regulations.
The mention of size or scale-based applicability of regulations is in context to the report that Parliamentary Standing Committee on Finance released in December.
In it, the committee had recommended the creation of a Digital Competition Law, and also classifying Big Tech companies as Systemically Important Digital Intermediaries (SIDIs) based on their revenues, market capitalisation, and end users.
"Size or scale-based applicability of regulations will not only impact larger
players in the market, but will also impact start-ups. Regulations that kick-in as soon as certain financial/size-based thresholds are met, will disincentivise start-ups from scaling in order to avoid additional regulations," the submission said.
While pointing towards "overarching regulations" in the European Union such as Digital Markets Act , IAMAI said that adopting such rules from overseas markets for India "would harm local markets, innovation, economic growth and consumers".
Apart from that, the IAMAI submission also said that a separate digital competition law will have an impact on innovation and on diversity in the Indian market.
It argued that targeting specific business models through a one-size-fits-all approach can create enforced biases towards certain business models, leading to less room for innovation and impacting consumer choice and product diversity.
Earlier, Indian entrepreneurs and members of the start-up ecosystem had criticised IAMAI's take against such a law in the draft version of the submission.
These companies insinuated that the industry body's stance was directly related to the composition of its leadership, which included members of Big Tech companies such as Google and Meta.
However, later IAMAI clarified that the "overwhelming majority of IAMAI members" were opposed to the idea of a separate competition law for the digital market, signalling that it would not make any changes to the views published in the draft report. On May 16, IAMAI submitted the final version without major changes to it.
It is also important to note that currently, the industry body is also conducting its governing council elections wherein 83 candidates, which include founders of Indian companies and those representing foreign tech bigwigs, are in the fray.