Panel urges competition law, code of conduct for tech cos

New Delhi: The Parliament’s Standing Committee on Finance, led by Jayant Sinha of Bharatiya Janata Party, on Thursday recommended implementing the Digital Competition Act and stipulating a code of conduct for the guys. technology giants to prevent them from abusing their market power to stifle competition.

In its report titled “Anti-competitive practices by Big Tech companies” presented to Congress on Thursday, the committee listed undesirable behaviors observed in the tech economy. digital and said that there should be a rule of behavior based approach (previous approach) for digital. The market winners are known as digital market gatekeepers. Unsolicited market practices highlighted by the board include e-commerce platforms that push their own brands above third-party brands sold within the platform, using their personal data. customers to stay ahead of the competition and pack different products and services.

Earlier this month, the council submitted its report on the Competition Amendment Bill 2022 to Parliament.

mint reported on August 18 that the government is considering an advance approach to regulating competition in digital markets that the Digital Markets Act is contemplating based on similar lines of law in EU.

This is to “ensure a fair, transparent and competitive digital ecosystem that will benefit not only our country and the nascent economy, but also the whole world.” world,” the panel said in its report. Digital businesses tend to reduce marginal costs quickly, and grow and scale quickly, resulting in a winner-take-all market. As a result, the digital market quickly explodes and one or two winners or leading players emerge in a short period of time.

By the time policies can be formulated or anti-competitive practices are adjudicated, the market will move in one direction and a winner will emerge. Therefore, competitive behavior needs to be assessed before the market comes to an end of monopoly rather than the latter assessment being carried out today, the panel said.

The forward approach is forward-looking regulation as opposed to initiating an investigation after an anticompetitive act has been committed.

The panel said that the systemically important digital market gatekeepers, which can negatively affect competitive behavior in the digital ecosystem, should be identified based on sales, capitalization as well as the number of businesses and their end users. A code of conduct should be applied to them.

It highlights ‘anti-driving’ provisions in e-commerce platforms that prevent business users from directing their customers to cheaper or more attractive alternatives. It also marks the practice of ‘self-inspection’ or no platform neutrality in the e-commerce business. This refers to an e-commerce platform that prioritizes its own or its subsidiary’s products or services over the products or services of other business users within the platform. This happens when the platform has a private label.

“The Committee specifically recommends that a systematically significant digital intermediary (SIDI) not prioritize its own preferences over that of a competitor when intermediating supply market access. supply and sales,” said the workshop. are pervasive across sectors in the digital market, allowing leading players to leverage their market power from one core platform service to another.

The Commission recommends that large e-commerce companies should not exploit the personal data of the platform’s end users in certain ways for advertising in order to ensure a level playing field.

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