Centre likely to extend tenure of Digital Competition law panel by a month

The Corporate Affairs Ministry (MCA) is likely to extend the tenure of the 10-member Committee on Digital Competition Law (CDCL) by one more month. 

Nearly a month has already passed since the earlier deadline of May 6 for submission of the report was missed by CDCL. With the Panel still continuing to deliberate on the contours of the proposed Digital Competition Law, the term of the CDCL is likely to be further extended for one more month (beyond June 6), sources said. The Panel had earlier given itself one month (till June 6) to wrap up the deliberations, but now further time may be taken to complete its work, it is learned.

For the first time last week, the CDCL meeting was attended by the newly appointed Competition Commission of India (CCI) Chairperson, Ravneet Kaur.

It may be recalled that the MCA, while setting up the CDCL on February 6, gave three months to the panel to submit the report and suggest a draft Digital Competition Act.

So far, this MCA-appointed committee, which also has six invitees from other ministries and government departments, has met seven times, with the most recent one on May 24.

CDCL has been tasked with examining the need for an ex-ante regulatory mechanism for digital markets through separate legislation. It has also been tasked with preparing a draft Digital Competition Act. 

The Panel will also have to review whether existing provisions in the Competition Act and the Rules and Regulations framed under it are sufficient to deal with the challenges that have emerged from the digital economy. 

The Centre is looking to frame a Digital Competition Act at a time when there is growing concern among policymakers around the world about the power and dominance of tech giants in the digital economy and the need to ensure a level playing field for all players in the market. 

Competition law experts are still divided on whether India needs a separate digital competition law or not. Some still contend that it would be premature for India to go in for an ex-ante framework through a separate law to prevent the anti-competitive conduct of Big Tech in digital markets.

In the meetings of CDCL so far, the panel has already heard representatives from various big tech companies, including Google, Apple, Amazon, and Netflix; industry associations, including digital news publishers; and digital start-ups.

India’s rapidly evolving digital economy, which is expected to touch $1 trillion by the year 2025–26.

Regulations in other countries

Even as India plans the enactment of a digital competition law, the enactment of such laws in developed countries has been a mixed bag. Some countries have made significant progress in this area, while others have been slower to act.

For example, the European Union has been at the forefront of digital competition law with its General Data Protection Regulation (GDPR) and its anti-trust investigations and fines against tech giants like Google and Facebook. Additionally, the EU has proposed new regulations, such as the Digital Markets Act and the Digital Services Act, which seek to create a more level playing field for businesses operating online.

The United States has also taken some steps towards digital competition law with the ongoing anti-trust investigations and lawsuits against companies like Google and Facebook. However, progress has been slower due to political and ideological divides.

In contrast, countries like Japan and South Korea have been slower to enact digital competition laws, although they have started to take steps towards regulation in recent years.

Overall, the enactment of digital competition laws in developed countries has been driven by a recognition of the increasing importance of the digital economy and the need to protect consumers and businesses from the negative effects of monopolistic practices in the digital space.