A committee tasked with shaping digital competition law has proposed a proactive approach to address the potential anti-competitive behavior of large digital corporations. In a draft report unveiled on Tuesday, the committee suggested the enactment of ex-ante legislation tailored specifically for major digital entities, complementing the existing Competition Act.
The proposed ex-ante law aims to enable proactive monitoring of the conduct of large digital enterprises, allowing the Competition Commission of India (CCI) to intervene before instances of anti-competitive behavior occur. Under this framework, the law would focus on regulating a pre-identified list of Core Digital Services susceptible to concentration, drawn from the CCI’s enforcement experience, market studies, and global practices.
Furthermore, the committee suggests that the Digital Competition law should only apply to enterprises with a significant presence in providing Core Digital Services in India and possessing the ability to influence the Indian digital market. To identify such players, the committee proposes two tests based on financial strength and market spread, requiring companies to conduct self-assessments and report to the CCI accordingly. Non-compliance could result in substantial fines of up to 10% of global turnover, ensuring adherence to regulatory requirements.
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