10 ASIAN LEGAL BUSINESS – INDIA E-MAGAZINE MARCH-APRIL 2024 In March, the Committee on Digital Competition Law in India released its report, which included the draft Digital Competition Bill, 2024 (DCB). However, the proposed regulatory approach envisioned in the DCB is raising more concerns than it aims to alleviate. Legal experts and policy groups say it increases compliance, stifles innovation, reduces market access for smaller companies and fails to address the key issue: Delays in the Competition Commission of India’s (CCI) investigation mechanism and adjudication process. WHY IS THE EXISTING COMPETITION ACT BEING OVERHAULED? Citing the inadequacy of the expost, or the post-violation investigation, mechanism under the current Competition Act (CA) in dealing with the increasing pace of digital markets, the committee’s report has suggested a new law, the DCB, to monitor anti-competitive conduct of certain “systematically significant digital enterprises” (SSDEs), in an ex-ante manner i.e. regulation of conduct to prevent any potential anti-competitive conduct. The committee found that the CA is not designed to facilitate speedy redressal of anti-competitive conduct given the extensive fact-finding and tiered adjudicatory process, leading to prolonged enforcement proceedings. It noted that because of the prolonged proceedings, there is a possibility of the markets tipping in favour of the dominant digital player. IS A NEW LAW NEEDED TO GOVERN DIGITAL MARKETS? But instead of creating a new law, these issues could easily be addressed within the scope of the CA legal experts say. “The existing competition law framework is sufficiently broad and malleable to address concerns arising in the digital economy, and the introduction of the exante legislation is likely to create legal uncertainty and operational challenges for digital players,” says Akshayy Nanda, a New Delhibased competition partner at Saraf and Partners. “It is the delay by the appellate bodies in final adjudication of competition cases and prolonged litigation that needs to be addressed, which may also become a similar challenge under the new ex ante legislation,” Nanda adds. Market tipping concerns can be effectively addressed by re-examining the power given to the CCI to pass interim orders during the course of an investigation. “The report does not discuss or deliberate on how the power to pass interim orders is inadequate to address the issue of the market tipping in favour of the large digital player during the course of an investigation,” Nanda explains. Image: TippaPatt/Shutterstock.com u u WHY DCB’s EX-ANTE APPROACH MAY NOT BE RIGHT TO ADDRESS BIG TECH CONCERNS BY NIMITT DIXIT Explainer
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