Breaking digital competition law may cost up to 10% of global turnover
NEW DELHI : Digital economy firms violating provisions of an upcoming competition law to govern them may be penalized up to 10% of their global turnover, a top government panel recommended. The corporate affairs ministry panel led by its secretary Manoj Govil on Tuesday proposed a new set of compliance obligations for influential digital economy firms such as Google, Apple and Meta.
The proposed new requirements to ensure fair play in the digital economy will govern systemically significant digital enterprises (SSDEs), which will be identified on the basis of factors like their India turnover, global turnover, gross merchandise value, global market capitalization or equivalent fair value at an enterprise or group level, and the number of end users in India. The ministry will accept feedback on the proposals on the draft bill by 15 April.
The new norms will govern search engines, social networking services, video-sharing platforms, interpersonal communications services, operating systems, web browsers, cloud services, advertising services and online intermediation services, the expert panel said in its report. “The committee proposes that a monetary penalty for non-compliance with ex-ante obligations is restricted to a maximum of 10% of the global turnover of the SSDE in line with the penalty regime under the Competition Act," said the report.
In cases where the firm is part of a group of enterprises, the committee recommended that the ‘global turnover’ cap is calculated in relation to the turnover of the entire group. The panel proposed that for the purpose of identifying a systemically significant digital enterprise, a base value of ₹4,000 crore of Indian turnover may be considered.
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