The ADIF Bulletin: CCI's crackdown on Google, DPIIT's move to decriminalize minor offences, and more

The ADIF’s monthly newsletter on all happenings in the Indus Valley Ecosystem and beyond. Share your feedback and comments with us at office@adif.in

DPIIT to seek cabinet approval for a bill to decriminalize minor offences

02.10.22

The Department for Promotion of Industry and Internal Trade (DPIIT) is expected to seek approval from the cabinet for a bill to decriminalize minor by rationalizing related provisions under different ministries to ensure ease of doing business. As per the officials citing PTI, the department targets introduction of the Ease of Doing Business and Ease of Living (Amendment of Provisions) Bill, 2022 in the winter session of the parliament and is in the final stages to approach the Cabinet for the same. The official added that "The bill seeks to decriminalize imprisonment provisions related minor offences to trivial procedural violations from 35 Acts. About 110 such provisions are proposed to be amended through this one bill. The idea is to replace imprisonment with penalties or graded punishment,". A few proposals include removal of a jail term of up to a year and a fine increase from Rs 5,000 to Rs 25,000 for failing to file returns or maintain records or registers under the Legal Metrology Act of 2009, as well as removal of a jail term of up to a year and a fine increase from Rs 5,000 to Rs 25,000 for failing to comply with orders restricting or controlling the import or export of marine products under the Marine Products Export Development Authority Act of 1972.

ONDC structuring rules on personal info protection, grievance resolution

03.10.22

The Open Network for Digital Commerce (ONDC), the government entity, is in the process of establishing regulations for the privacy protection and complaint handling for buyers, sellers, and gateways using its network. According to a consultation paper published by ONDC on Thursday, a comprehensive set of rules would be included in the ONDC network policy including a set of guidelines for the protection of personal information and the establishment of grievance resolution mechanisms. The policy also has rules on issues like branding guidelines, code of conduct and ethics, business rules, and onboarding and certification requirements.

CCI may adopt OECD standards for digital companies

06.10.22

India’s antitrust regulator, the Competition Commission of India (CCI), might adopt some of the prescribed standards by The Organization for Economic Co-operation and Development (OECD). The CCI is keeping a close eye on the dominance of the market by digital companies and will be undertaking preventive steps. As per sources, steps such as issuance of interim orders along with employing data analytics and conducting extensive market studies are being explored. Regulatory interventions take time to get implemented, which is why ex-ante powers are being considered. In this regard, the best practices published by OECD in 2021 comes in handy to help competition regulators all over the world to stay ahead of the curve.

DPIIT announces credit guarantee scheme for startups; invites suggestions for ease of doing business

08.10.22

The Department for Promotion of Industry and Internal Trade (DPIIT) has notified credit guarantee scheme for startups for providing collateral-free loans. “The central government has approved the 'Credit Guarantee Scheme for Startups (CGSS) for the purpose of providing credit guarantees to loans extended by member institutions (MIs) to finance eligible borrowers being startups,” the DPIIT said. The government would establish a trust or fund, run by the Board of National Credit Guarantee Trustee Company Ltd as the Fund's Trustee, to guarantee payment against default in loans or debt provided to eligible borrowers. A management committee will be established by the department to handle the trust's business.

The DPIIT has also invited suggestions from businesses and citizens on issues faced while starting a business and prospects of decriminalisation of minor offences under different provisions/sections. “The aim is to make ‘New India’ a preferred investment destination across the globe and ensure hassle-free service delivery to the ultimate beneficiary,” it said in a statement.

Ecommerce user base in India to overtake US in the next couple of years: Bain report

11.10.22

According to a report by consulting firm Bain & Co and homegrown e-tailer Flipkart, ecommerce in India is expected to grow at a rate of 25–30% annually for the following five years, with a steady increase in user base that is predicted to surpass the second largest ecommerce shopper base – the United States – in the next two years. The number of online shoppers in India, which was 180–190 million in 2021, will rise to 400–450 million by 2027, when it is projected that the industry will be worth more than $150 billion. According to the report, the e-commerce market will be worth $50 billion this year, up 40% over the previous year. “With the pace of growth we are talking about, we are very soon going to be the second largest shopping base, only behind China,” said Manan Bhasin, partner, Bain & Co. As online commerce evolves across the nation, it is anticipated that the mix of categories will change, with rising demand for food, fashion, and other categories. According to Bhasin, the proportion of fashion in overall ecommerce sales will probably rise to 25–30% from 20–25% today.

CCI orders fresh investigation against Google, clubs all complaints from news publishers

13.10.22

In light of the complaints from various organizations against Google, the custodian of fair competition in India, the Competition Commission of India (CCI), has directed the DG to club together all the investigations. This directive came on the 6th of October after the News Broadcasters & Digital Association (NBDA) raised allegations against the tech behemoth. Earlier this year, the Digital News Publishers Association (DNPA) and the Indian Newspaper Society (INS) filed similar allegations.

The nature of concerns raised in all the 3 complaints was similar, which revolves around how Google is using its dominant position in the market to engage in unfair practices. Some of the concerns include lack of negotiating power of app developers while entering into a contract with Google, Google’s influence in the news ecosystem by means of their strong algorithms, and improper compensation to the news websites.

SC dismisses pleas by Meta Platforms Inc against CCI probe into WhatsApp's privacy policy

15.10.22

The Supreme Court dismissed the pleas by Meta Platforms Inc challenging the probe ordered by the Competition Commission of India (CCI) into WhatsApp's updated privacy policy of 2021. A bench of Justices M R Shah and Sudhanshu Dhulia stated that "We've heard the counsel. No interference of this court is required to be called for. The CCI is an independent authority to consider any violation of the provisions of the Competition Act of 2002 and cannot be dissuaded from investigation and alleged violation of Competition Act, 2002," Based on news reports, the CCI made the independent decision to investigate WhatsApp's amended privacy policy in January of last year.

The antitrust watchdog had stated that their investigation concerned WhatsApp's anticompetitive sharing of user data with Facebook. It also justified the opening of an investigation into Facebook in relation to WhatsApp's privacy policy, claiming that the latter is the holding company for the messaging service and might potentially misuse the data shared.

India working towards tech-driven regulatory framework for cryptocurrency: FM Nirmala Sitharaman

16.10.22

India is working towards coming up with standard operating procedures for cryptocurrency during its G20 presidency next year, Finance Minister Nirmala Sitharaman has said. She has emphasized that all countries want the technology to survive but not be misutilised. To combat the issues of money laundering and terror funding, Sitharaman has been pushing for global regulation of cryptocurrencies. Noting that organisations like the World Bank and the G-20 are conducting their own analyses and research on issues pertaining to cryptocurrencies or other digital assets, she added "We would definitely want to collate all this and do a bit of study and then bring it on to the table of the G-20 so that members can discuss it and hopefully arrive at a framework or SOP, so that globally, countries can have a technology driven regulatory framework."

Rules and frameworks need to be calibrated to address risks from big tech – RBI report

18.10.22

As per a report by RBI, to address the risks emerging from the interlinkages between big tech companies and their role as essential service providers for financial institutions, the Reserve Bank of India and other international financial market regulators must calibrate regulatory frameworks with a combination of entity- and activity-based rules. The challenge is to balance between promoting efficiency, protecting data privacy and ensuring financial stability, as regulators always have the additional challenge of catching up with the technologies and innovations of the Bigtech companies.

Tech, talent, and startups to help India’s Web3 rise: Nasscom report

19.10.22

According to a report by the IT industry group Nasscom, India's quick uptake of new technologies, its expanding startup scene, and the prospective pool of highly qualified digital workers, are the ideal foundations for the country to become a critical player in the global Web3 landscape. According to the report “The India Web3 Startup Landscape: An Emerging Technology Leadership Frontier”, there have been over 450 Web3 startups in India as of the first half of the year, with more than $1.3 billion invested in Web3 since 2020. “One-third of these startups have come up in the past year alone, and several of them have a B2B model. A lot of them are also working on areas outside cryptocurrency like DeFi (decentralised finance) and entertainment,” said Achyuta Ghosh, senior director and head- insights, Nasscom. Web3 startups in India have grown about six times since 2015. India's economic, demographic, and technology adoption factors place it well to become a high-growth Web3 market, even though the response to Web3 globally is still in its early stages.

Google slapped with a Rs 1338 crore fine for “anti-competitive practices”

19.10.22

The Competition Commission of India (CCI) announced a penalty of Rs 1338 crore on Google. This is mainly due to the abuse of the tech giants’ dominant position in the market in multiple domains such as mobile OS, web browser, play store, search, and video sharing amongst others. CCI noted that Google is resorting to unfair practices in many ways, including, mandatory pre-installation of Google Mobile Suite (GMS, which include apps by Google such as Maps, Gmail, YouTube etc.) by virtue of agreements with OEMs, and restrictions on uninstallation of these apps. In addition to this, the antitrust regulator also put out a list of measures which the company needs to comply with and has barred Google from carrying out unfair business practices.

Google fined Rs 936 Cr by CCI due its Play store policies

25.10.22

The Competition Commission of India (CCI), India's antitrust watchdog, fined Google Rs 936.44 crore on October 25 for abusing its dominant position with regards to its Play Store policy. The petition for this allegation was filed by the Alliance of Digital India Foundation (‘ADIF’) against the tech behemoth.

Based on its assessment from all the allegations, the Commission came up with a set of conclusions, which states that mandatory usage of GPBS for paid apps and in-app purchases, not using GPBS for its own applications i.e., YouTube, and integration of its own UPI app in relation to other rival UPI apps with the Play Store, are violations as per the Competition laws. The Commission issued a cease-and-desist order for Google from indulging in anti-competitive practices and ordered 8 corrective measures, which include allowance of usage of any third-party billing/payment processing services for app creators, maintenance of complete transparency when engaging with app developers about the services offered and associated costs, and laying out a clear and transparent policy about the data that is collected on its platform, its usage, and whether it will share that data with app developers or other parties, including related entities.