Over a dozen top startups including Zomato, Myntra and Nykaa commanding millions of users and large revenues are likely to face stricter compliance standards under the new legal regime governing digital competition. Besides global entities such as Alphabet and Meta, these local companies too may be identified as digital gate-keepers with significant influence over the market, independent estimates showed. The upcoming Digital Competition Bill which aims to ensure fair play in digital markets sets specific thresholds, which are expected to cover these companies.
The draft Digital Competition Bill prepared by an expert committee and released for feedback by the corporate affairs ministry earlier this year proposes to identify influential digital economy companies, to be called ‘systemically significant digital enterprises’ or SSDE, who will be required to follow certain ‘dos and don’ts’ called ex-ante regulations and file annual compliance reports to the Competition Commission of India (CCI). Businesses violating the law could be penalized up to 10% of their global turnover. Apart from top food delivery, streaming and fashion platforms, the new law will also cover some companies in delivering medicines, booking rail tickets and offering digital payments, showed a study by CUTS Institute for Regulation and Competition or CIRC, a think-tank working in the areas of economics and law.
CIRC’s analysis is based on publicly available information on these companies. In comp.
