The Standing Committee on Finance’s has presented a report on ‘Anti-Competitive Practices by Big Tech Companies’ which was tabled in Parliament on December 22.
Key recommendations
- The committee has asked digital market entities to desist from “anti-steering”, “deep discounting”, “self preferencing”, “search & ranking preferencing” and other practices that will impact competition in the market.
- Anti-steering provisions are clauses whereby a platform prevents the business users of the platforms from ‘steering’ its consumers to offers other than those provided by the platform that may be cheaper or otherwise potentially attractive alternative in terms of a better interface.
- A Digital Competition Act is needed to ensure a fair, transparent and contestable digital ecosystem, which will be a boom not only for the country and its nascent start-ups economy but also for the entire world.
- The panel has called for classifying leading entities that can negatively influence competitive conduct in the digital ecosystem as ‘Systemically Important Digital Intermediaries’ (SIDIs) based on their revenue, market capitalisation and number of active business and end users.
- Further, the SIDI within certain fixed months of its online platform being designated as ‘Systemically Important Digital Intermediary’, and thereafter annually submit a report to CCI describing in a detailed and transparent manner the measures it has implemented to comply with its mandatory obligations.
- The Committee stressed on identifying SIDIs based on their revenues, market capitalisation and number of active business & end-users.
- The SIDI operator should also publish on its website a non-confidential summary of the report.
- A specialised digital markets unit should be established within Competition Commission of India (CCI) staffed with skilled experts, academics and attorneys.
- The said unit will closely monitor SIDIs and provide recommendations to the central government on designating SIDIs, among other activities, Putting ex ante obligations on SIDIs, the Committee recommended that SIDI should refrain from imposing anti-steering provisions upon business users of the platform.
