The proposed amendments, cleared by Parliament, to the Competition Act offers more powers to the Competition Commission of India (CCI) in pursuing what it sees as anti-competitive behaviour.
Recently, the National Company Law Appellate Tribunal (NCLAT) upheld a ₹1,337 crore superb imposed by the CCI on Google for the agency’s contracts with cellular producers.
The amendment to the Competition Act was cleared by the Rajya Sabha on Monday, whereas the Lower House had given its nod final month. The Bill, which amends the Competition Act, 2002 for the primary time since 2007, permits the CCI to penalise entities discovered partaking in anti-competitive behaviour based mostly on their world turnover, as opposed to their earnings in India alone. While this modification will not be worded to be unique to Big Tech corporations, companies like Google which have discovered themselves within the cross hairs of CCI investigations have excessive revenues exterior India, multiplying the potential impression on them.
The “introduction of provisions regarding computation of penalty on global turnover… has taken the legal fraternity as well as the business community by surprise, as they have been introduced without inviting any comments from stakeholders,” 5 attorneys from the agency IndusLaw wrote in a notice on the law in February.
The Act additionally empowers the CCI to cross orders in relation to anti-competitive agreements and the “abuse of dominant position”, by imposing a penalty that may both go up to 10% of the common earnings or turnover for the three previous monetary years.
Tech giants akin to Google or Meta report vastly smaller Indian turnovers as compared to their U.S. or European markets. While India has tens of millions of Internet customers, the share of income per consumer in greenback phrases tends to be a small fraction of the earnings in western markets.
The adjustments may also give the CCI a higher say in mergers and acquisitions, as entities could have to search its approval if offers are price more than ₹2,000 crore, and if each events have substantial enterprise operations in India.
