Market study in works to regulate big technology firms

New Delhi: The corporate affairs ministry has told a House panel that it has decided to adopt an evidence-based and adaptive approach in finalising the Draft Digital Competition Bill for bringing in a proposed law, with an ex-ante framework, to regulate big tech companies.

A market study is being conducted to assess appropriate qualitative and quantitative thresholds of companies that would be covered under the new law, review core digital services, and evaluate the impact of the proposed ex-ante framework on competition, innovation, and market entry, the ministry said. As per the initial draft digital competition Bill, firmed up by a government panel in 2024 along with a report, digital players that are designated as systemically significant - based on stipulated turnover and user thresholds - will be required to comply with a set of ex-ante regulations framed by the antitrust regulator. Most of the big tech companies had opposed such a law.

Ex-ante regulations aim to frame rules to keep businesses from engaging in problematic behaviour rather than punishing them after such an event. The government was supposed to assess the panel's draft Bill and the report before firming up its own Bill after due process of consultations. The ministry's replies are part of a report of the Parliamentary Standing Committee on Finance, which was submitted in Parliament on Monday.