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Does EU’s Digital Markets Act suit India’s digital market regulation needs? #NAMA

India’s Committee on Digital Competition Law (CDCL) is expected to study international best practices for regulating digital markets

In 2022, the European Union brought into effect its Digital Markets Act (DMA) which seeks to address unfair practices by companies that act as gatekeepers in the online platform economy. Just like the EU, India is also in the midst of deciding whether it needs a DMA or not. To that effect, it has created a Committee on Digital Competition Law (CDCL) which is expected to study international best practices for regulating digital markets. This leaves one wondering: Would the EU’s DMA be factored into India’s digital market regulation? And would it even be applicable to Indian circumstances?

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The context of the EU’s DMA

“The point of the [EU] DMA and something that is very evident from the text of the provisions that are out there is that it flows from cases that the European Commission has litigated and continues to litigate, investigations that they continue to do, market studies that they continue to do,” said Shruti Aji Murali legal counsel at Axiom5 Law Chambers discussing the act during the “Regulating Marketplaces: E-commerce and App Stores” panel at MediaNama’s MarketsNama conference held on May 19. She says that a lot of the obligations or prohibitions being enforced under the EU’s DMA are a byproduct of 10 years of debate around digital markets. 

Issues with its application in India

“For India, one major difference is the kind of market we are the stage of development at which we are right. India is very different obviously from the EU. Internet penetration levels are different, growing but different familiarity of Indian consumers with digital platforms is growing but still different and our preferences are different,” she added. 

It is also worth noting that the EU has put in ex-ante regulations for digital markets, which means that it has put in place pre-emptive controls on big tech companies from engaging in practices that hinder competition. The question of ex-ante regulation is also being debated in India with people expressing both positive and negative opinions on such regulation. “ I’m not sure that the same ex-ante prohibitions might play out in the same way. In India if you introduce rule a and say thou shall not do X, it may work in the EU context or in the US context. Simply because that has been perceived to be a problem in say nine out of ten cases,” Aji Murali shared. She believes that India’s DMA needs to be created with the country’s businesses and consumers in mind.

Another panelist, Abir Roy, co-founder of Sarvada Legal and a competition law expert agreed to Aji Murali’s take and said “Everything has to be tested on the ground realities as exists in that country in the first place. So, I think every law is different every application of the law would be different. Even our Constitution may be taken from a foreign constitution, but it has to be applied on the ground reality.”

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“We need to think, why did the Europeans in their digital strategy say that we made a data protection law, we tested the competition law, and these don’t work and maybe gatekeepers are the nature of a digital market,” a participant at the discussion commented. 

This post is released under a CC-BY-SA 4.0 license. Please feel free to republish on your site, with attribution and a link. Adaptation and rewriting, though allowed, should be true to the original.

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