Google, Amazon, and Apple lobby group rejects India’s proposed antitrust regulations similar to those in the EU

NEW DELHI: A US lobby group representing tech giants Google, Amazon, and Apple has urged India to reconsider its proposed EU-like competition law. In a letter, the group argues that regulations against data use and preferential treatment of partners could increase costs for users.

Citing the increasing market dominance of a few major digital companies in India, a government panel proposed in February to impose new obligations on these firms under a fresh antitrust law. This law aims to complement existing regulations, which the panel described as “time-consuming” to enforce.

India’s “Digital Competition Bill” is modeled after the EU’s landmark Digital Markets Act of 2022. It targets major firms, including those with a global turnover exceeding $30 billion and digital services with at least 10 million local users, thereby encompassing some of the world’s largest tech companies.

The bill proposes to prohibit companies from exploiting users’ non-public data and from promoting their own services over those of rivals. It also seeks to eliminate restrictions on downloading third-party apps.

Companies use these strategies to introduce new product features and enhance security for users. Curbing these practices will affect their plans, the US-India Business Council (USIBC), part of the US Chamber of Commerce, stated in a May 15 letter to India’s Corporate Affairs Ministry, which is working on the law.

The draft Indian law is “much further in scope” than the EU’s, according to the letter, which has not been made public but was seen by Reuters.

“Targeted companies are likely to reduce investment in India, pass on increased prices for digital services, and reduce the range of services,” it says.

The USIBC, which has requested India to reconsider the planned law, did not respond to Reuters’ queries, nor did the Corporate Affairs Ministry, Apple (AAPL.O), Amazon (AMZN.O), or Google (GOOGL.O).

India, with its population of 1.4 billion people and an expanding affluent class, represents a lucrative market for big tech companies. Apple CEO Tim Cook recently stated that the company achieved a “revenue record” in India during the March quarter, despite a 4% decline in its overall global revenue.

The Indian panel asserts that the new law is necessary because a few major digital enterprises “exert immense control over the market”. Similar to the EU, it is recommending a penalty of up to 10% of a company’s annual global turnover for violations.

For years, the Competition Commission of India (CCI) has been conducting investigations into major tech firms.

In 2022, the CCI imposed a fine of $161 million on Google, instructing it to cease the practice of restricting users from uninstalling its pre-installed apps and to permit downloads without the requirement of its app store. Google denies any wrongdoing, contending that such restrictions are essential for enhancing user security.

Amazon is currently under an antitrust investigation for allegedly favoring select sellers on its India website, an accusation it denies. Similarly, Apple refutes allegations but is under investigation for purportedly abusing its dominant position in the apps market.

A group of 40 Indian startups has voiced support for the new Indian law, stating that it could help tackle monopolistic practices by dominant digital platforms and foster a level playing field for smaller companies.

While there is no fixed timeline, the Indian government will proceed to review feedback on the proposal before seeking parliament approval, whether with or without changes.