Digital market distortions need prompt correction

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Digital market distortions need prompt correction
Digital market distortions need prompt correction

CCI is in the process of setting up a Digital Markets and Data unit (DMDU) as a centre of expertise for digital markets

Distortions in digital market need to be corrected promptly as India is emerging as one of the biggest and fastest digital economies, Competition Commission of India chairperson Ashok Kumar Gupta said on Saturday.

“With control over used data and online real estate, the digital platforms are in a unique position to shape and influence consumer choices on one hand and steer consumer traffic to their businesses to the other,” Gupta said while addressing the Annual Conference on Competition Law and Practice organised by the Confederation of Indian Industry (CII) along with Competition Commission of India (CCI).

Over their competition and contestability, the gatekeeper position of these platforms is giving rise to concerns, he noted.

By the opacity in policies and the data advantage they have over both business users and potential competitors, the impact of these ‘so-called ecosystems’ is compounded, said Gupta.

“While India emerges as one of the biggest and fastest growing digital consumer bases, market distortions need to be corrected promptly. To address the challenges of enforcement and policy in this regard, the regulatory framework needed to adapt and reflect digital market complexities, reframe classic categories and concerns around personal and non-personal data and add other dimensions of quality and privacy, identify issues early on and cause faster remedial interventions,” he added.

The challenges are multi-dimensional, and to reflect digital market complexities, the antitrust, analytical and conceptual framework need necessary adaptations, he said.

Another challenge is that the data related conduct not only requires reshaping the classic antitrust around personal and non-personal data as the relevant asset but adding other dimensions of competition such quality and privacy, he stated.

Adding that the challenges for policy makers and regulators is to keep abreast of the development in these markets and continue to evolve and refine the tools, he said, earlier identification of faster remedial interventions are of paramount importance even though the digital market is prone to tipping.

With respect to proposed amendments in the new Competition Amendment Bill, introduced in Lok Sabha on August 5, he said it aims to provide regulatory certainty, faster market corrections and trust-based business environment.

The Bill is expected to bring in commitment and settlement framework, and the leniency plus regime apart from introducing deal value threshold and facilitating faster-review of merger notifications.

Gupta said the Bill broadens and deepens the scope of inter-regulatory consultations – a crucial area for reforms to avoid regulatory overlaps.

With the proposed introduction of a limitation period of three years for filing information or reference before CCI for anti-competitive agreements and abuse of dominant position, Gupta assured that it would bring certainty to markets and business and those very old cases will not be re-opened.

Including e-commerce, telecom, and pharmaceutical, among others, the commission has been also conducting a host of market studies on various sectors, he said.

To engage with stakeholders, provide inputs on policy issues and support data analytics, CCI is also in the process of setting up a Digital Markets and Data unit (DMDU) as a centre of expertise for digital markets, he said.

On filing information, confidentiality provisions, leniency provisions, and merger regulations, CCI has come out with a list of FAQs for the benefit of stakeholders, Gupta said.

CCI will have a regional office in Mumbai soon to provide further ease of access to stakeholders, he added.

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