Elon Musk's X backed India's proposal to bring in new law to tackle Big Tech

These submissions to the Committee for Digital Competition Law was made in 2023

Only Elon Musk's X, among foreign tech majors such as Google, Amazon and Meta, was outrightly in favour of a regulation aimed at addressing anti-competitive practices by Big Tech companies, according to the 235-page report of the Committee on Digital Competition Law (CDCL) released by the government on March 12.

The report included the draft Digital Competition Bill, which has been opened for public consultation. The bill proposes various additional obligations for major technology companies such as Google, Meta or X and introduces hefty fines if such companies are found non-complaint with the bill.

In contrast to X, other foreign technology companies were against the need for a separate ex-ante digital competition law. While Meta advocated further research on the Indian market before introducing such regulation, Amazon said it is already heavily regulated under the foreign direct investment policy.

Google said it was against ex-ante regulation "except under certain conditions." Ex-ante regulation refers to regulatory measures that are implemented in anticipation of potential issues or problems.

Apple took a balanced approach. The company said it was in favour of "light touch regulations" as opposed to those modelled after the EU's Digital Markets Act.

Indian companies Swiggy, Flipkart, Oyo and Zomato were also against such a law. MakeMyTrip and Paytm were in favour of such a law only if it applied to select large companies.

The report comes after the CDCL, which was formed in 2023, studied whether the country needed a separate, ex-ante law to tackle competition issues involving Big Tech companies.

The CDCL had sought comments from stakeholders on the necessity of a digital competition law. X, formerly Twitter, and several other Big Tech companies, Indian counterparts and industry associations had made representations in response.

What Big Tech told the committee

X: In its submission, the social media company said that in order to implement a strong ex-ante regulatory framework, institutions need skilled academics to monitor global tech trends for the Indian market. The company urged the government to define significant digital intermediaries carefully and align data collection with the DPDP Act.

Meta: The owner of Facebook, Instagram and WhatsApp was "not presently in favour of ex-ante regulation." The Big Tech major advocated the need for an impact assessment of the proposed bill.

"Meta believes in observing and advancing further research before rushing to adopt any variation of the DMA (or any of the other ex-ante frameworks being considered presently)," the CDCL report quoted Meta as saying.

Google: The search engine company said it was not in favour of an ex-ante regulation "except under conditions."

"Any new ex-ante regulation ought only to apply to firms in markets where they are found to have ‘SIDI’ power," the CDCL report quoted Google as saying.

SIDI, or systematically important digital intermediaries, is a label that was proposed by the Parliamentary finance committee in its report on anti-competitive practices by Big Tech firms in 2022. A company can be labelled as SIDI based on its market capitalisation, number of users and so on.

In the draft digital competition bill, which was released for public consultation on March 12, the term SIDI has been replaced with Systematically Significant Digital Enterprises or SSDEs.

Amazon: The e-commerce giant said, "Ex-ante regulation for the e-commerce sector may be untimely and excessive and may lead to over-regulation. There is a risk of increased compliance costs and regulatory overlap." The company said it is already heavily regulated under the FDI policy.

Apple: While the iPhone maker was not in favour of a regulatory approach modelled after the Digital Markets Act, it was in favour of light-touch regulation. The company recommended that the Competition Commission of India consider opening a regional office in Bengaluru "in order to get easy access to the technology ecosystem of the country."

Uber: The ride-hailing company was not in favour of an ex-ante regulation and said such regulation may "discourage innovation and restrict existing players from investing in proving quality, efficiency, processes, etc."

Where Indian companies stood

Swiggy and Bundl Technologies: Swiggy, the food ordering platform said that an ex-ante regime "would cause a chilling effect on the startup industry."

"Ex-ante regulations may pose a risk of incorrect/misplaced regulation of smaller homegrown players which provide digital technology-enabled products and services," the report said, quoting Swiggy.

Flipkart: Flipkart was not in favour of such a law. "The existing ex-post regime in India is well-equipped to effectively regulate digital markets in India," the company argued.

MakeMyTrip: The online travel portal company was in favour of an ex-ante regulation only if they are applicable to "select large horizontal platforms that have created economy-wide ecosystems." However, it was not in favour of an ex-ante regulation of the online travel market.

Oyo: Oyo, which was not in favour of such a law, said that broad regulations may disincentivise innovation. "It can also hinder India's growing tech sector, adversely affect investments in homegrown tech companies and make our economy less competitive globally," the hospitality company said.

Paytm: The digital payments company said, "In favour of ex-ante regulation as long as only large digital enterprises who have a critical mass (for instance, a certain specified revenue and a certain number of users) are subject to the regulations."

Zomato: "Not in favour of ex-ante regulation. However, if it is sought to be introduced, it should be tailored to the Indian ecosystem, should be conducive to the growth of startups, and should not stifle innovation and/or consumer interest," the restaurant aggregator and food delivery company said.