Govt Mulling Behavioural Norms For Tech Giants, Violations To Lead To Penalty

The government is reportedly mulling coming out with behavioural norms for tech giants in the digital markets, and violations of the norms may lead to imposition of penalty.

The government is looking at framing the behavioural norms to ensure that the digital markets remain competitive and prevent abuse of dominance by established companies, Mint reported.

Two parliamentary standing committees have looked into the need for ‘dos and don’ts’ for digital economy firms, the report added.

The law – Digital Markets Act – will cover large businesses in the digital economy across sectors like search engines, ecommerce platforms, social media platforms, the report said. The organisations will be identified based on their reach.

The norms, discussions for which are in initial stages, may restrict various actions such as “self-preferencing” by e-commerce platforms, promotion of private labels, and use of business users’ data. 

The penalty for violation will be decided based on the revenue earned by the companies during the years in which they were at fault.

The norms would be finalised based on the reports of the two parliamentary standing committees.

The development comes at a time when the government is looking to strictly regulate and punish violations by tech giants. The mergers and acquisitions in the digital business space could soon come under the ambit of the Competition Commission of India (CCI).

In August, the government also began an inter-ministerial dialogue for consultations on legislation to regulate data collection and data usage policies of big tech companies. Representatives from the Ministry of Corporate Affairs, the Ministry of Electronics and Information Technology, and the CCI participated in the discussions.

Besides the proposal to formulate a new Digital Markets Act, the panel also suggested introducing certain guidelines in the Competition Act to address concerns surrounding the new-age digital companies.

The government is planning to introduce at least three more legislations to take the country’s digital regulatory system at par with the global standards, Telecom Minister Ashwini Vaishnaw said recently.

From WhatsApp to Google to Amazon, a number of foreign tech giants are under scrutiny in the country for alleged violations of laws and resorting to anti-competitive practices.