Big Tech on a Leash?

The battle against Big Tech from India’s own technology-driven companies began several months ago when a group of them got together to highlight anti-competition challenges. Now, it appears that their voice has found its mark with the government, which is reportedly drafting a specific digital competition law to rein these multinationals. 

According to a report published in the ET, the ministry of corporate affairs is considering a separate law for regulating big tech instead of making tweaks to the existing Competition Act that was recently amended. However, the report quoted unnamed sources to suggest that such a law could take time given the divergence of views among stakeholders. 

It further said that the government was in no hurry to draft legislation just for the sake of it and whenever it enters the statute books, the law should take care of all possibilities, which is why a lot of deliberations are required. The sources quoted similar developments in the US and the UK where legislation to regulate large digital players was under discussion.  

The them versus us situation continues

As a reminder to our readers, several domestic tech companies led by names such as Paytm, Spotify and Bharat Matrimony had written to the government that their views on the digital competition legislation was at variance with those submitted by the apex body governing India’s internet and mobile businesses (IAMAI). 

It was quite obvious that the views expressed by this group were at variance with what Google and Microsoft had sent. At the core of the tussle is a provision around the prescription of ex-ante regulations for digital entities as part of the new law. While the official note from IAMAI opposed the said measures on grounds that they may stymie growth in the market and well as the digital economy itself, the dissent note said such a move only benefited the big tech companies.  

The ex-ante regulations sought to identify and address issues preemptively by laying out a list of dos and don’ts for all stakeholders. The government Committee on Digital Competition Law (CDCL), set up in February to draft an anti-competition law for digital platforms, had sought the views of the industry, which now seems vertically divided. 

The preliminary report may decide the future 

This committee led by corporate affairs ministry secretary Manoj Govil is said to be close to completing the first draft of its report, which may be submitted as early as in September. From what we hear around the corridors of power in New Delhi, the report could well form the basis of the government’s next plan of action. 

In fact, there are those within the administration who consider that the Competition Act had already been amended once this year to address immediate issues around fair trade concerns. And doing so once more may not look good, especially since India is aspiring to grow its economy with support from the very same set of Big Tech companies. 

Speculations over how government will respond

At this point, there is speculation that the government may go ahead with the ex-ante regulations with specific lists of dos and don’ts for systemically important digital intermediaries. They may also define who falls under this list based on a set of criteria such as nature of business, turnover and user base. 

Before getting down to drawing up their strategy, the government would also take on board the recommendations made by the standing committee of Parliament on finance, which is headed by former state finance minister Jayant Sinha. A point to note is that this committee had first brought up the idea of a separate digital competition law amidst a slew of legal cases against companies such as Meta, Apple and Google over antitrust matters.