Amid Polls, IAMAI Re-Nudges Govt Against The Proposed Digital Competition Regime

In another twist to the ongoing saga involving the Internet and Mobile Association of India (IAMAI) and startups, the industry body has claimed that its members have written to a government panel, opposing ex-ante regulations for digital markets.

Ex-ante norms look to identify issues and suggest measures before any competition-related issues arise in a market.

In its submission to the Committee on Digital Competition Law (CDCL), the industry body said that its members were of the view that the existing rules were sufficiently adept at addressing competition concerns in the sector. This comes a few days after it was reported that IAMAI had submitted its final arguments on the matter to the CDCL.

IAMAI added that scale-based applicability of ex-ante competition laws would limit the growth potential of startups and would impact the growth trajectory of larger players. It also said that such threshold-based norms would disincentivise Indian tech companies from scaling up, in order to avoid additional regulations.

The threshold essentially alluded to a Parliamentary Panel’s December 2022 report that called for defining the concept of Systemically Important Digital Intermediaries (SIDIs) based on certain parameters such as revenue, market capitalisation and end users of the big techs. It is this scale-based that IAMAI is opposed to.

Citing the Monopolies and Restrictive Trade Practices (MRTP) Act, 1969, IAMAI claimed that a similar size-based approach under the law had limited the growth and scaling up of Indian companies. 

“Notably, as part of various economic reform measures, India consciously moved away from an ex-ante regime under the MRTP Act. Taking competition policy for India’s digital sector back to the MRTP era will burden India’s most promising sector and inhibit its ability to scale, innovate and attract investments,” the IAMAI added. 

Speaking with Inc42, requesting anonymity, a startup cofounder said that the current leadership of IAMAI was represented by foreign players and the submissions to CDCL were nothing but masked opinions of the big tech players. 

“Less than 10% of IAMAI members are non-Indian MNCs, yet, they occupy 100% of the key positions within the IAMAI. As a result, a lot of startup founders have come together to imbibe one philosophy — Indian interests should be first and foremost,” the cofounder said. 

IAMAI In Disarray

This came on the second day of voting for IAMAI’s Governing Council. Earlier on May 15, IAMAI announced that 83 members of IAMAI were contesting the polls for a 24-member council. Among these, the top three nominees would then form the executive council, comprising chairperson, vice-chairperson and treasurer of the association.

The results are expected to be declared by the end of this month and the new governing council will take over the charge of the body post June 2023. 

A source told Inc42 that of the total nominees, 65 are Indian startups while the rest comprises big tech players and other MNCs. 

Meanwhile, as per sources, top startup executives, including the likes of MapmyIndia’s Rohan Verma, Shaadi.com’s Anupam Mittal, Dream11’s Harsh Jain, Rajesh Magow of Makemytrip,  Droom’s Sandeep Aggarwal, PhonePe’s Sameer Nigam of PhonePe, and InfiBeam Avenues’ Vishwas Patel, among others, were in the fray for the elections. 

This comes a week after infighting broke within the organisation after IAMAI publicly opposed the demand for a separate digital competition law in the country. In response, Indian startups claimed that the industry body was batting for big tech players and against the interests of the homegrown players.