Large tech companies including Google, Apple, Flipkart, Amazon, and Uber have responded to the recommendations of the expert committee on digital competition law by opposing ex-ante regulation. While Paytm and Twitter are among those who support the laws, the latter stated in its stakeholder response that it supports the regulations only if they apply to large digital firms that reach a certain size.
Amazon noted in its stakeholder submission that it was already heavily regulated by the foreign direct investment policy, which requires that it can only act as an online marketplace and not as a seller and that it should provide fair terms to sellers, even though it stressed that ex-ante regulation for the e-commerce sector may be premature, excessive, and may lead to over- regulation.
The expert group has said that only businesses with a "significant presence" in India that can impact the country's digital market and provide a fundamental digital service should be subject to the draft Bill. The debate over the digital competition law is taking place amid widespread criticism of companies like Google, Apple, Facebook, Amazon, and others for allegedly abusing their market positions by utilizing large amounts of customer data.
The expert committee has recommended that the draft Bill should only regulate enterprises that have a ‘significant presence’ in the provision of a core digital service in India and the ability to influence the Indian digital market. The discussion around the digital competition law comes amid a global scrutiny of Google, Apple, Facebook, Amazon, and others for allegedly abusing their market position using chunks of user data.
According to the draft Bill, these businesses would have to set up clear and efficient processes for managing complaints and adhering to regulations, as well as report and conduct business with end users and business users in an equitable, non-discriminatory, and transparent manner.
In addition to not using or relying on private customer information of companies using its main digital service, SSDEs are prohibited from favoring in any way its goods, services, or business ventures, as well as those of affiliated parties.
In addition to the onerous limitations that these ex-ante rules place on tech companies, they may hinder innovation. This can have unforeseen repercussions like fewer options for consumers and increased costs.