An Update On India’s Proposed Digital Competition Law

India’s proposed Digital Competition Law has evolved through several stages, from the 2022 Parliamentary Committee report and the 2024 Committee on Digital Competition Law’s draft Bill, through a 2025 government reconsideration, to renewed Parliamentary backing for an ex-ante framework in August 2026. Drawing on comparative experience from the EU, UK, and Japan, this article argues that legislative reform must be matched by a strengthened Competition Commission of India if ex-ante regulation is to work in practice.

BACKGROUND:

India’s proposed Digital Competition Law has travelled through several stages. It began with a Report in December, 2022 by the Parliament’s Finance Committee² with the following recommendations/observations, namely:

1. Digital markets are in many ways different from traditional markets and that these markets inter-alia have a trait of increasing returns to size i.e. big and bigger returns as the size of business increases primarily driven by network effects. The utility for users grows as the number of users grow. They also benefit from economies of scale, extensive data collection, strong ecosystem effects and low marginal costs. These characteristics enable a successful platform to expand rapidly into adjacent markets;
2. The Report recommended that India identify leading players in digital markets, to be designated as Systemically Important Digital Intermediaries (SIDIs) or ‘gatekeepers’ based on their revenue, market capitalisation and number of end users and business users;
3. The competition law regime needs to be enhanced by enacting a separate Digital Competition Law to regulate digital markets and this new law should also be implemented/enforced by the existing Competition Commission of India (CCI). It also recommended the strengthening of the CCI and also suggested the establishment of Digital Markets Unit within it;
4. The conventional competition law enforcement mechanism is primarily ex-post. It intervenes after potentially anti-competitive conduct has occurred and after an investigation establishes the relevant market, dominance and competitive harm, the market is corrected/remedied. In digital markets, however, delay may be decisive. By the time an investigation is completed, the market may have “tipped” permanently towards one platform, making restoration of competition difficult or impossible. It therefore recommended a preventive, ex-ante framework under which designated digital gatekeepers would be subject to specified obligations before harmful conduct occurred. The proposed approach is not intended to regulate every digital enterprise. It was directed at large platforms capable of influencing the competitive conditions of digital ecosystems.
5. An identified high-tech giant or gatekeeper ought not to be allowed to perform dual role namely (a) providing the platform and (b) competing on the platform as a supplier of goods/services. These SIDIs should be prohibited from restricting third-party applications, bundling/tying and giving access to the platform conditional on purchase/use of other products that are not part of the platform. Restriction should be imposed on cross-using personal data collected from different services without meaningful user choice.

The 2022 Parliamentary Report thus established the basic policy architecture to:

• Identify a limited class of powerful digital platforms;
• Impose mandatory conduct obligations in advance;
• Supplement those obligations with stronger CCI capacity; and
• Preserve ordinary competition-law enforcement for conduct outside the ex-ante framework.

2. THE CDCL AND THE DRAFT DIGITAL COMPETITION BILL, 2024

In the wake of Parliamentary report, the Ministry of Corporate Affairs in the Government of India constituted a Committee on Digital Competition Law (“CDCL”) in February 2023³. Its mandate was to examine whether the existing competition framework was sufficient for digital markets and to suggest a draft law if a separate framework was required.

The CDCL submitted its report on 12 March 2024 along with a Draft Digital Competition Bill, 2024 with the following features⁴:

2.1 Systemically Significant Digital Enterprises:

The draft Bill proposed the designation of “Systemically Significant Digital Enterprises” or “SSDEs”. An enterprise would be capable of designation where it provided one or more identified core digital services and satisfied specified quantitative (turnover/gross merchandise value or market capitalisation) or qualitative criteria assessed through the number of business users/end users. The Bill also introduced the concept of Associate Digital Enterprises (ADEs) i.e. associated/affiliated companies of SSDEs which participated in providing relevant CDSs and that these ADEs will also be subject to the same obligations as SSDEs.

2.2 Core digital services:

The Bill contemplated regulation of providers of specified “core digital services” (“CDSs”) and these included online search engines, social networking services, operating systems and web browsers. The broader framework also contemplated online intermediation services, advertising services and cloud services.

2.3 Conduct obligations:

The draft Bill proposed prohibiting SSDEs from engaging in several practices, including:

• Favouring their own products or services, or those of related parties;
• Using non-public data generated by business users to compete against those users;
• Restricting the installation or operation of third-party applications; requiring or incentivising users of one core service to use another product or service of the SSDE;
• Imposing tying or bundling arrangements; and
• Preventing business users from communicating alternative offers to their customers.

2.4 Enforcement and penalties:

The draft Bill proposed using the existing investigative structure under the Competition Act, including the Director General. The CDCL recommended a significant expansion of the CCI’s technical and economic capacity to detect and determine digital-market violations.

It also recommended a separate NCLAT bench for speedy disposal of appeals involving digital competition matters.

Contraventions were to be addressed through civil penalties rather than criminal sanctions. The draft contemplated using global turnover for calculating the penalty and proposed a maximum penalty of up to 10 per cent of the SSDE’s global turnover.

The draft Bill therefore combined a targeted ex-ante framework with existing CCI enforcement machinery. It did not propose replacing CA02.

3. THE GOVERNMENT’S 2025 RECONSIDERATION:

In July and August 2025, media reports indicated that the Government was reassessing the original design of the Bill⁵. The reported concern was that a prescriptive ex-ante regime might impose unnecessary costs on smaller businesses, reduce innovation and create uncertainty about the treatment of emerging technologies.

It was reported that a market study would be undertaken to examine, inter-alia, the following:

• The appropriate quantitative and qualitative thresholds for SSDE designation;
• Whether the proposed list of CDSs remained appropriate;
• Whether individual services should be added to or removed from the list; and
• Whether ex-ante regulation was necessary for all proposed categories of service.

The study was also reported to examine the impact of the proposed regime on competition, investment, innovation, start-ups and smaller enterprises.

It was also indicated that the Government was considering whether some digital-market concerns could be dealt with through CA02, especially after the introduction of settlement and commitment mechanisms by the Competition (Amendment) Act, 2023. Those mechanisms allow enterprises to offer commitments or settlements in appropriate cases, potentially enabling faster and more targeted intervention.

4. THE PARLIAMENTARY REPORT IN THE PUBLIC DOMAIN ON 10 AUGUST 2026:

The Parliamentary Committee report made public on 10 August 2026 has revived support for the ex-ante model⁶. Public reporting indicates that the Committee favoured proceeding with a Digital Competition Bill rather than abandoning the project.

The reported recommendations relevant to digital competition law include:

• Finalising and introducing the Digital Competition Bill⁷;
• Retaining an ex-ante framework for designated digital enterprises;
• Ensuring that designation is based on objective market and economic criteria;
• Keeping the list of CDSs under review;
• Considering whether emerging or strategically important digital services should be brought within the framework; and
• Avoiding regulatory gaps in markets dominated by a small number of large platforms.

The report also urges closer monitoring of concentrated or duopolistic digital markets. This is important in India, where some digital sectors have developed around two or a small number of major platforms.

The Committee’s position appears to be that the Government’s ongoing market study should improve the design of the law, not indefinitely postpone it. The need for evidence-based thresholds and a carefully defined CDS list is compatible with the adoption of an ex-ante statute.

4.1 Strengthening the Digital Markets Division (DMD):

The report also addresses the institutional capacity of the CCI’s Digital Markets Division. This is a particularly important recommendation because ex-post enforcement will remain necessary even if a Digital Competition Act is enacted.

The DMD would require:

• specialist economists, data scientists, technologists and sectoral experts;
• capacity to monitor market structure and business models continuously;
• access to high-quality market and user data; expertise in algorithms, artificial intelligence, cloud services, app stores and digital advertising;
• ability to identify emerging anti-competitive conduct before it becomes irreversible;
• coordination with the Director General, MeitY and other regulators; and
• faster investigation and case-management processes.

The Committee’s approach recognises that a formal ex-ante law cannot substitute for effective institutions. A statute may define prohibited conduct, but the CCI must still understand complex technology markets, assess objective justifications, distinguish innovation from exclusionary conduct and determine remedies that do not unintentionally damage competition.

4.2 Government response to Parliament Committee:

The Government’s response, as reflected in public reporting, is that the Digital Competition Law will be progressed and enacted at the earliest. The Government has not, however, indicated that every recommendation of the Parliamentary Committee or every provision of the 2024 draft Bill will be adopted without modification.

The Government has also indicated the importance of strengthening the CCI’s existing digital-markets capabilities. This suggests a dual-track model: a targeted ex-ante law for designated platforms and stronger ex-post enforcement under CA02 for the wider digital economy.

5. LESSONS FROM OVERSEAS:

5.1 European Union:

The European Union’s Digital Markets Act (“DMA”)⁸ is the principal international example of an ex-ante digital competition framework. It applies to designated “gatekeepers” providing specified core platform services. The designation process considers both quantitative thresholds and qualitative factors. The DMA also imposes obligations, provides for substantial fines and the possibility of structural remedies in cases of systematic noncompliance.

The recent implementation reviews⁹ have shown both the value and difficulty of ex-ante regulation. The reviews conclude that the existing law is fit for purpose. The framework has produced more rapid intervention than conventional antitrust proceedings, but compliance often involves technically complex negotiations, expensive monitoring and repeated clarification of the legal obligation.

The EU model also demonstrates that ex-ante regulation does not eliminate the need for ordinary competition law. The two regimes operate alongside each other.

5.2 The United Kingdom:

The United Kingdom adopted a different model through the Digital Markets, Competition and Consumers Act 2024 (“DMCC”)¹⁰. The Act gives the Competition and Markets Authority power to designate firms with “Strategic Market Status” in relation to a particular digital activity.

The UK model is more conduct-specific and potentially more flexible than a list of uniform prohibitions. The CMA may impose conduct requirements and pro-competition interventions adapted to the circumstances of the designated firm and activity.

The UK’s experience in cloud services is particularly relevant to India. The CMA’s cloud market investigation¹¹ examined concerns involving data egress charges, interoperability, software licensing and switching barriers. The experience suggests that regulators should distinguish between:

• Competition problems requiring immediate intervention;

• Problems that can be addressed through commitments or interoperability measures.

5.3 Japan and other jurisdictions:

Japan has traditionally relied more heavily on its existing competition-law institutions, sectoral regulation and targeted legislation. Its Mobile Software Competition Act¹² addresses concerns associated with dominant mobile operating systems and app distribution, particularly in relation to Apple and Google.

Japan’s approach illustrates the value of service-specific regulation. Rather than treating all digital markets identically, it focuses on specific bottlenecks such as mobile operating systems, app stores and payment systems.

5.4 United States:

The United States continues to rely primarily on antitrust litigation and sector-specific enforcement, although legislative proposals for digital gatekeeper regulation remain part of the policy debate. Australia has pursued sectoral codes and targeted digital-platform regulation. The United Kingdom and Japan therefore provide useful examples of flexible, activity-specific regulation, while the EU provides the clearest example of a comprehensive ex-ante framework.

CONCLUSION:

India’s proposed Digital Competition Law is now at a more mature stage of policy development. The 2022 Parliamentary report supplied the basic justification for ex-ante regulation. The CDCL translated that justification into the concepts of SSDEs, ADEs, CDSs and mandatory conduct obligations. The ongoing market study is expected to suggest necessary refinement of thresholds, the service categories, the flexibility of changing the core digital services list as market conditions change and the effects on innovation, investment and harm. The August 2026 Parliamentary report has renewed the call for legislation while emphasising that the CCI’s Digital Markets Division must be strengthened.

The Government’s promise to enact the law should therefore be understood as a commitment to complete the legislative process, not as a commitment to reproduce the 2024 draft unchanged.

Footnotes

^{1 G R Bhatia is Senior Partner & Head of Competition Law Practice, Corporate Professionals Advisors & Advocates, New Delhi.  He is former Additional Director General of the Competition Commission of India (CCI) and the erstwhile Monopolies & Restrictive Trade Practices Commission (MRTPC), Government of India.  The views expressed are personal and he can be reached at gbhatia@indiacp.com.} 

^{2 Standing Committee on Finance, Seventeenth Lok Sabha, Fifty-Third Report, ‘Anti-Competitive Practices by Big Tech Companies’ (22 December 2022), Lok Sabha Secretariat:}

^{https://prsindia.org/files/policy/policy_committee_reports/Report_Summary-Anti-Competitive_Practices_by_Big_Tech_Companies.pdf}

^{3 Ministry of Corporate Affairs, Report of the Committee on Digital Competition Law (12 March 2024), Annexure II – Order Constituting the Committee (6 February 2023):  https://www.mca.gov.in/bin/dms/getdocument?mds=gzGtvSkE3zIVhAuBe2pbow%3D%3D&type=open}

^{4 Draft Digital Competition Bill, 2024, Ministry of Corporate Affairs (12 March 2024): https://www.medianama.com/wp-content/uploads/2024/03/DRAFT-DIGITAL-COMPETITION-BILL-2024.pdf}

^{5 MediaNama, reporting Moneycontrol, ‘Centre May Drop Ex-Ante Rules from Digital Competition Bill’, 13 August 2025: https://www.medianama.com/2025/08/223-centre-ex-ante-rules-digital-competition-bill/}

^{6  Standing Committee on Finance, Eighteenth Lok Sabha, Thirty-Seventh Report, ‘Action taken by the Government on the Observations/Recommendations contained in the Twenty-Fifth Report... Evolving Role of Competition Commission of India in the Economy, particularly the Digital Landscape’ (presented to Lok Sabha 10 August 2026), Lok Sabha Secretariat (full text hosted via MediaNama): https://www.medianama.com/wp-content/uploads/2026/08/10Aug2026_ParliamentaryCommitteeFinanceReport.pdf}

^{7 Supra 6}

^{8 Regulation (EU) 2022/1925, the Digital Markets Act:  https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32022R1925}

^{9 European Commission, Report on the Functioning and Review of the Digital Markets Act, COM(2026) 178 final (28 April 2026): https://digital-markets-act.ec.europa.eu/document/download/b0994f7a-ac97-45d2-a741-7e287b4ac004_en?filename=DMA+Review+Report_COM_2026_178_1_EN.pdf}

^{10 Digital Markets, Competition and Consumers Act 2024, United Kingdom:  https://www.legislation.gov.uk/ukpga/2024/13/contents}

^{11 Competition and Markets Authority, cloud services market investigation: https://www.gov.uk/cma-cases/cloud-services-market-investigation}

^{12 Japan Fair Trade Commission, Mobile Software Competition Act materials: https://laws.e-gov.go.jp/law/506AC0000000058}

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The views expressed in this article are solely those of the author in her personal capacity and are based on her understanding of the applicable legal and regulatory framework. They do not necessarily represent the views, policies or practices of organisation with which the authors is associated.