Tech firms to be penalized for digital market rules breach in India
Digital economy giants may face a penalty for breaching a set of online behavioral norms in New Delhi, India.
Penalties are meant to protect the digital markets to remain competitive and to keep big companies from abusing their dominance if early discussions in government will make it into a new law.
Two parliamentary standing committees have looked into the need on which actions are prohibited and which factors are to be tolerated for digital economy firms, and discussions for a Digital Markets Act.
“Digital markets often result in ‘winner take all’ monopolistic outcomes due to the network effect. The ex-ante approach to competition regulation could pre-empt the natural tendency of the digital economy to move toward anti-competitive practices,” BJP leader Jayant Sinha said.
“Digital markets tip very quickly and result in monopolistic outcomes, and one needs to look at them ahead of the market tipping, not afterwards, because once the market tips, you cannot do much about it,” he added.
Furthermore, the proposed code of conduct is also expected to specify what digital economy firms must do in terms of their business practices. This is likely to include the interoperability of systems.
