Need to enact digital competition law: Panel – Times of India


NEW DELHI: The government should consider and introduce a digital competition law to ensure a fair, transparent and contestable digital ecosystem and the country’s competition law must be enhanced to meet the requirements of restraining anti-competitive behaviour in the digital markets, a Parliamentary committee has recommended.
“The committee feels that India needs to enhance its competition law to address unique needs of digital markets. Unlike traditional markets, economic drivers that are rampant in digital markets quickly result in a few massive players dominating vast swathes of the digital ecosystem,” according to the report of the standing committee on finance, headed by BJP lawmaker Jayant Sinha.
The report said since digital markets do not have sufficient competition, they are also prone to significant anti-competitive behaviour by leading players and called for strengthening the Competition Commission of India.
It has suggested that a specialised digital market unit be established within the commission, staffed with skilled experts, academics and attorneys, enabling the commission to closely monitor Systemically Important Digital Intermediaries (SIDIs) and emerging SIDIs, provide recommendation to the Centre on designating SIDIs, review SIDI compliance and adjudicate digital market cases and conduct for efficient and effective monitoring of digital markets.
The panel has recommended that competitive behaviour needs to be evaluated ex-ante before markets end up monopolised, instead of the ex-post evaluation being carried out at present.
It has also said authorities must identify small number of leading players or market winners that can negatively influence competitive conduct in the digital ecosystem as SIDIs, based on their revenues, market capitalisation and number of active business and end-users.
The panel has identified 10 anti-competitive practices, which include anti-steering provisions, platform neutrality/self-preferencing, adjacency/bundling and tying, data usage (use of non-public data), acquisitions and mergers, pricing and deep discounting, exclusive tie-ups, search and ranking preferencing, restricting third party applications and advertising policies.
The committee noted that Big Tech companies’ advertising business is a monopolist threat as they own every step that connects ad sellers and buyers and gives them an unfair advantage in market.
“The committee thus recommends that a SIDI should not process for the purpose of providing online advertising services, personal data of end-users using services of third parties that make use of core services of the platform. It should provide advertisers information on a daily basis, regarding price paid by the advertiser and the remuneration received by the publisher,” according to the report.
“Further, the committee note that India has diverse and numerous news publishers, who get advertising revenues primarily through SIDIs and are of the opinion that regulatory provisions are required to ensure that news publishers are able to establish contracts with these SIDIs through a fair and transparent process,” said the report.


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