(Shourya Mitra, Senior Editor at IELR)
Since the Digital Competition Bill (DCB) was released earlier this year for consultation, it has received significant pushback from various stakeholders, including MSMEs, for being potentially harmful to Indian companies. These criticisms appear to have reached the Ministry of Electronics and Information Technology (MeitY), which is now expected to discuss the ex-ante provisions with the Ministry of Corporate Affairs. While the bill is said to be significantly based on the Digital Markets Act (DMA), stakeholders suggest that it does not seem to introduce enough changes to make it conducive to the Indian economy. This includes various thresholds for the recognition of a Systemically Significant Digital Enterprise (SSDE). The monetary threshold for an enterprise's turnover is set at INR 4,000 crores, while the user threshold is proposed to be 1 crore end users. Both thresholds are considered very low, especially the latter, given India's active online population (820 million or 82 crores). These thresholds may be met by many companies that the law may not have intended to regulate. Additionally, the term “end users” for the user threshold does not differentiate between active and inactive users, significantly altering the provision's applicability. There are numerous other critiques of the bill, including ambiguous definitions and unclear terms.
Furthermore, there are concerns regarding the regulator’s capacity, as the DCB adds another legislation that the Competition Commission of India (CCI) must enforce alongside the already existing Competition Act, 2002. This is in addition to the anti-profiteering matters that the CCI has been tasked with handling since late 2022. While there are discussions about transferring the anti-profiteering cases to the GST Appellate Tribunal in the future, the CCI itself has expressed concerns over its anti-profiteering mandates, as this is not its primary function. Moreover, the budget allocated to the CCI has not increased significantly in the last few years (≈ 50 crores). Therefore, the DCB may further add to the burden of the regulator.
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