10 anti-competitive practices Big Tech companies must avoid: Parliament Panel

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The Indian parliamentary Standing Committee on Finance in its report ‘Anti-Competitive Practices by Big Tech Companies’ has identified 10 practices by the Big Tech companies which create unfair conditions for smaller businesses in a digital market.

Anti-steering, which essentially means restricting access to third-party apps on their platforms, deep discounting, self-preferencing in online listings, exploiting personal data for advertising and unchecked acquisitions among others are the key issues highlighted by the panel.

The Committee recommends defining leading digital firms as ‘Systemically Important Digital Intermediaries’ (SIDIs) or gatekeepers and subject them to ex-ante regulations to curb anti-competitive practices in Indian digital markets.

Here are the ten don’ts for the SIDIs recommended by the Committee:

  1. A SIDI should not condition access to its platform for third-party apps or assign preferred status or placement for its own apps when users use products or services which are not intrinsic to its platform.
  2. When it comes to listing companies on digital platforms, a SIDI must not favour its own offers over the offers of its competitors and refrain from pre-installing its own offers on devices.
  3. A SIDI should not force business users or end users to subscribe to or sign in for its additional services as a condition for accessing any of the platform’s core services.
  4. SIDIs should not indulge in processing, combining or cross-using personal data of end users accessing third-party services or those using platform’s core services for online advertising services. It must also refrain from compelling users to sign in for additional services to access personal data unless user consent is provided.
  5. When it comes to mergers or acquisitions, a SIDI cannot go ahead until the Competition Commission of India (CCI) is notified of such acquisitions in the digital sector. The CCI must be informed prior to the implementation of an agreement and the announcement of a public bid.
  6. Regarding deep discounting and pricing by Big Tech companies, the Committee suggests that a SIDI must not prevent business users from offering the same products and services through third-party online intermediation services or their own direct channel at varying prices.
  7. A SIDI must avoid exclusive tie-ups that may constrict competition and end up favouring certain businesses in terms of offering the same products and services through third-party or direct channels.
  8. A SIDI must not treat specific businesses favourably in providing access to fair, reasonable and non-discriminatory terms to search-engine related operations such as ranking, click, query and others.
  9. A SIDI should enable the installation of third-party software applications or stores using or interoperating with its operating system. The only exception may be made in case of preventing data from the SIDI or another business user from being transferred to the government of a foreign adversary.
  10. A SIDI should not process users’ personal data for online advertising services using third-party services. Advertisers and publishers must be able to carry out their independent verification of the advertisements inventory of aggregated and non-aggregated data.

Why does it matter?

With reference to the Competition legislations of the European Union, United States of America, Germany and Australia, the Indian parliamentary panel in its report lays out specific practices that lie at the crux of antitrust cases against the Big Tech such as Google, Apple, Meta and Amazon in several countries.  Addressing these issues can expedite the regulatory process and remedial measures concerning Big Tech Competition cases in India too.

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