Digital Competition Bill: Big Tech company may face heavy fine

Digital Competition Bill: To prevent big tech companies like Meta, Amazon, and Google from acting arbitrarily, the Central Government proposed the Digital Competition Bill (DCB) last year. To accomplish this, the government formed a 16-member inter-ministerial committee on February 6, 2023, under the Ministry of Corporate Affairs (MCA). This committee prepared the draft of the bill and submitted its report to the government.

Digital Competition Bill

The Digital Competition Bill includes provisions for hefty fines, potentially up to 10 percent of the global turnover of tech companies.

The Corporate Affairs Ministry (MCA) formed the 16-member inter-ministerial committee due to the expanding digital economy. The committee’s task was to create a digital competition law by revising the existing Competition Act 2002.

The new Digital Economy Bill addresses challenges faced by the digital economy in the existing competition law. The committee, known as CDCL, also submitted a 236-page report to the Finance Ministry along with the draft of the Digital Competition Bill. This new bill follows the framework of the European Union’s Digital Markets Act (DMA).

The committee, led by Corporate Affairs Secretary Manoj Govil, emphasized in its report the importance of actively monitoring the behavior of big digital companies. It suggested that the Competition Commission of India (CCI) should intervene before incidents of anti-competitive conduct occur, rather than after, as per the existing law.

The Committee Recommended Several Actions

  1. Identifying large digital companies based on financial strength and expansion.
  2. Companies falling under this scope should conduct self-evaluation and report to CCI.
  3. Strengthening CCI’s Digital Markets and Data Unit with IT sector experts to match the rapid growth of the digital market.
  4. Establishing a separate bench to expedite appeals against CCI orders, especially those related to digital markets.
  5. Stakeholders have until April 15, 2024, to propose amendments to the draft bill. Afterward, the bill may be sent to Parliament for approval.

Failure to comply with the recommendations could result in heavy fines for digital companies, potentially up to 10 percent of their global turnover. These regulations will notably impact companies like Google, Apple, Amazon, and Meta.

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I am an Indian blogger, journalist, author and entrepreneur. I am working in digital marketing and IT sector for more than 10 years.