Anindita Nayak
Bhubaneswar, 29 May
A US lobby group representing tech giants Google, Amazon, and Apple has urged India to reconsider its proposed EU-like competition law. In a letter, the group argues that regulations on data use and preferential treatment of partners could increase user costs.
In response to the growing market dominance of a few major digital companies in India, a government panel proposed in February the imposition of new obligations under a fresh antitrust law. This new legislation is intended to complement existing regulations, which the panel described as “time-consuming” to enforce.
India’s “Digital Competition Bill,” modeled after the EU’s Digital Markets Act 2022, targets major tech companies. It applies to firms with a global turnover exceeding $30 billion and digital services with at least 10 million local users. The bill aims to prevent these companies from misusing users’ non-public data and favoring their own services over competitors. It also seeks to remove restrictions on downloading third-party apps, aiming to create a fairer digital marketplace.
In a May 15 letter to India’s Corporate Affairs Ministry, the US-India Business Council (USIBC), part of the US Chamber of Commerce, expressed concerns about the new law. They argued that restricting these strategies, which companies use to launch new features and enhance user security, would hinder their plans. The letter also stated that the draft Indian law is “much further in scope” than the EU’s.
“Targeted companies are likely to reduce investment in India, pass on increased prices for digital services, and reduce the range of services,” it says.
The Indian panel is of the opinion that the new law is necessary because a few large digital companies wield immense control over the market. Similar to the EU, it suggests penalties of up to 10% of a company’s annual global turnover for violations.
The Competition Commission of India (CCI) has been investigating big tech firms for years. In 2022, the CCI fined Google $161 million, demanding it stop preventing users from removing its pre-installed apps and allow downloads outside its app store. Google denies any wrongdoing, claiming these restrictions enhance user security.
Amazon is under antitrust investigation for allegedly favoring certain sellers on its Indian platform, which it denies. Apple is also being investigated for allegedly abusing its dominance in the app market. Meanwhile, a group of 40 Indian startups supports the new law, believing it will tackle monopolistic practices and create fair competition for smaller companies.
