On March 12, 2024, the Ministry of Corporate Affairs (MCA) published the Report of Committee on Digital Competition Law, which contains the bill for the Digital Competition Act, 2024 in Annexure IV. In particular, the MCA stated that the report and the bill will be under the E-Consultation module on the MCA's website on March 15, 2024, for stakeholder comments and suggestions up to April 15, 2024.

More specifically, the report provides a background on competition law in India, emerging international laws and practices, and key features of the bill. Notably, the bill proposes to identify 'systemically significant digital enterprises' and 'associate digital enterprises,' and to regulate their practices in the provision of core digital services, keeping in view the principles of contestability, fairness, and transparency.

What are the key provisions of the bill? 

In particular, the bill defines key terms such as 'enterprise,' 'systemically significant digital enterprises,' 'associate digital enterprises,' 'service,' and 'end user.'

According to the bill, an enterprise will be deemed to be a systemically significant digital enterprise in respect of a core digital service if:

• it meets any of the following financial thresholds in each of the immediately preceding three financial years:
  • turnover in India of not less than INR 40 billion (approx. $482.8 million);
  • global turnover of not less than $30 billion;
  • gross merchandise value in India of not less than INR 160 billion (approx. $1.9 billion); or
  • global market capitalization of not less than $75 billion, or its equivalent fair value of not less than $75 billion calculated in such manner as may be prescribed; and
• it meets any of the following user thresholds in each of the immediately preceding three financial years in India:
  • the core digital service provided by the enterprise has at least 10 million end users; or
  • the core digital service provided by the enterprise has at least 10,000 business users.

Provided that the enterprise does not maintain or fails to furnish the data mentioned above, it shall be deemed to be a systemically significant digital enterprise if it meets any of the thresholds as stipulated above. Notably, the Competition Commission of India may designate a systemically significant digital enterprise in respect of a core digital service, even if it does not meet the above criteria, if the Commission believes that such enterprise has a significant presence based on an assessment of the information available with it and based on any or all of the factors provided in the bill. 

What are the obligations under the bill?

The bill proposes certain obligations on significant digital and associate digital enterprises. Regarding data usage, the bill would obligate a systemically significant digital enterprise to not, directly or indirectly, use or rely on non-public data of business users operating on its core digital service to compete with such business users on the identified core digital service of the systemically significant digital enterprise.

Additionally, a systemically significant digital enterprise would not, without the consent of the end users or business users:

• intermix or cross-use the personal data of end users or business users collected from different services including its core digital service; or
• permit usage of such data by any third party.

The bill clarifies that end user consent would have the same meaning as per the definition provided in the Digital Personal Data Protection Act, 2023, while consent for business users will be specified. 

You can read the press release here and the report and bill here.