What is Digital Competition Bill

India has been actively considering various measures to regulate digital platforms and promote competition in the digital economy.

One significant development in this regard is the draft Personal Data Protection Bill (PDPB), which aims to regulate the collection, processing, and storage of personal data by both government and private entities. While the primary focus of the PDPB is data protection, it also contains provisions related to competition and the prevention of abuse of data dominance.

Some potential implications are:

· Self-Reporting Obligation: The Bill proposes that online entities, particularly large ones, will have to self-declare the fairness and transparency of their practices. This means they'll need to demonstrate that they don't restrict competition by limiting the functionality of third-party applications on their platforms.

· Focus on Openness: This provision aims to prevent situations where dominant players like Google or Facebook might favour their own services within their ecosystems, hindering competition from smaller players.

The rapid growth of the digital economy has led to increased scrutiny by the CCI. The Ministry of Corporate Affairs prepared a draft Bill containing the proposed regulations. This draft was submitted to the Committee on Digital Competition Law for consideration and feedback.

The Competition Commission of India is responsible for enforcing competition laws in India. The CCI has been closely monitoring the digital sector and has initiated investigations into alleged anti-competitive practices by major technology companies.

The digital entities who qualify as gatekeeper platforms or systemically important digital intermediaries would have to provide this declaration to the Competition Commission of India, according to the proposed Bill.

As per the source, with the amendments coming into force, the Competition Commission of India now has the power to impose a penalty of up to 10% of a company's global turnover for competition law violations.

The provision could have a larger impact on companies having multi-products or multi-services and also assumes significance as cases related to digital markets are being probed by the CCI.

With the new norms, the penalty that could be imposed for violations could be higher. As a result, companies and individuals are encouraged to opt for commitment and settlement options or leniency.

Going forward, Big tech players and companies having multi-products and multi-services will be impacted more, in case the CCI decides to impose penalties for competition law violations.

S Mohini Ratna, Editor, VARINDIA