Digital Competition Bill: Us vs Them

The writing was on the wall a couple of months ago when a bunch of Indian companies fought and won a turf war against big tech firms for control at one of India’s high profile tech industry associations. Now the same group has shared a dissent note on some provisions of the proposed Digital Competition Law saying they do not agree with some provisions of the Bill. 

A bunch of big names led by Paytm, Spotify and Bharat Matrimony have reportedly written to the government’s committee saying their views are at variance with those submitted by the Internet and Mobile Association of India (IAMAI). They were arrayed against the likes of Google and Microsoft who sent the official note from the apex body while holding its reins. 

More regulations vs less regulations?

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 Swadesi vs Videsi tussle 

Of course, this isn’t the first time that Indian brands have been at loggerheads with global ones at the IAMAI. We had reported four weeks ago about this battle for supremacy where several prominent leaders representing Indian companies had claimed that the apex body’s notes to the government around digital law was opposed to the consumer’s interest. 

An article published by ET quotes from the dissent note to suggest that IAMAI’s submissions ignore the fundamental reality of why debate over ex-ante regulations are taking place around the world. The status quo has failed and is failing to constrain the power and conduct of the dominant digital gatekeepers that control commerce. 

The note said ex-ante regulation is a need of the hour for India’s digital sector’s growth which would benefit from a new regulatory framework that improves competition in this sphere. Currently, the protracted nature of traditional antitrust litigation is expensive and extensive, the note has said. 

The law is for the entitled few, they say

The group, which represents Indian companies and startups at the IAMAI also noted that the case-by-case approach of adjudicating on violations by select gatekeepers in the digital ecosystem has encouraged uncertainty, besides providing privileges to some while depriving others from participating in a fair manner. 

The dissent note has also recommended setting up systemically important digital intermediaries to identify such gatekeepers, which incidentally matches the recommendations of a Standing Committee on Finance in Parliament. Officially IAMAI had opposed these suggestions but when the formal submission was made to the government, it was struck off. 

On a side note, even Indian companies don’t seem to be seeing eye to eye on the matter with Sameer Nigam of PhonePe saying ex-ante regulations were a bad idea saying founders could be backing them for opportunistic reasons and may seek less regulation later. This appeared to be an indirect jibe at his competitor Vijay Shekhar Sharma of Paytm.