Multiple civil society organisations and technology lobby groups have voiced their opposition against the framing of a digital competition law that is expected to rein in Big Tech companies, in an open letter to the Secretary of Ministry of Corporate Affairs on June 26.
“We are concerned that the proposed Digital Competition Act would impact a wide range of subjects, such as digital inclusivity, user experience, data protection & security, foreign investment, cost of doing digital business for MSMEs, indirect impact on cost for consumers, etc,” the letter said.
The letter, signed by internet activist Nikhil Pahwa, India Internet Foundation, Indian Network Operators Group, SaaS company EnDetech, strategic consulting firm DeepStrat and 53 others, argued that if India introduces a prescriptive ex-ante law, then it may no longer be the “first market” for newer technologies.
“An ex-ante law which limits data will naturally drive costs for advertising and digital marketing as particularly the larger brands will continue to spend even without precise targeting,” it said.
“Hence, the ex-ante laws could inadvertently increase customer acquisition costs for small businesses and it would eventually decrease their global market footprint. Small businesses do not have the runway to undergo this type of change,” it added.
The proposed framing of such a law has already led to a rift between domestic and international technology companies in the country, with Indian tech companies taking control of lobby group Internet and Mobile Association of India (IAMAI) in a heated governing council election last month.
This followed after a controversy that erupted in April when IAMAI, whose members include both Indian companies and large foreign companies, argued against the need for a separate digital competition framework aimed at regulating "anti-competitive practices" by Big Tech companies, in a draft submission.
Indian entrepreneurs had slammed the IAMAI, saying that a digital competition law was indeed necessary and insinuated that the industry body's stance on the matter reflected the composition of its leadership.
In 2022, the Parliamentary Standing Committee on Finance (Finance Committee) held oral evidence and meetings with industry stakeholders and government departments on the issue of “Anti-competitive practices by Big Tech companies” and tabled their report in the Parliament in December 2022. In their report, it was recommended that India should have a Digital Competition Act consisting of set rules based on recent and ongoing antitrust cases in relation to the digital markets.
In February 2023, the Ministry of Corporate Affairs formed a committee to evaluate the proposal for a digital competition law in India and recommend a draft Digital Competition Bill. Reportedly, the committee is finalising the proposed Digital Competition Act and is likely to recommend “ten obligations that the identified gatekeepers” would have to meet.
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