NEW DELHI : Digital economy enforces violating provisions of an upcoming competition law to govern them may be penalized up to 10% of their global turnover, a top government panel recommended.
The corporate affairs ministry panel led by its secretary Manoj Govil on Tuesday proposed a new set of compliance obligations for influential digital economy firms such as Google, Apple and Meta.
The proposed new requirements to ensure fair play in the digital economy will govern systemically significant digital enterprises (SSDEs), which will be identified on the basis of factors such as their India turnover, global turnover, gross merchandise value, global market capitalization or equivalent fair value at an enterprise or group level, and the number of end users in India.
The ministry will accept feedback on the proposals on the draft bill by April 15.
The new norms will govern search engines, social networking services, video-sharing platforms, interpersonal communications services, operating systems, web browsers, cloud services, advertising services and online intermediation services, the expert panel said in its report.
“The committee proposes that a monetary penalty for non-compliance with ex-ante obligations is restricted to a maximum of 10% of the global turnover of the SSDE in line with the penalty regime under the Competition Act,” said the report.
In cases where the firm is part of a group of enterprises, the committee recommended that the ‘global turnover’ cap is calculated in relation to the turnover of the entire group.
The panel proposed that for the purpose of identifying a systemically significant digital enterprise, a base value of ₹4,000 crore of Indian turnover may be considered. For global turnover, the panel recommended $30 billion. For gross merchandise value, it proposed ₹16,000 crore (about $1.95 billion).
The committee also recommended adopting a base value of $75 billion for global market capitalization. The panel recommended that 10 million end users or at least 10,000 business users in India as a benchmark for the reach of the business.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it’s all here, just a click away! Login Now!
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 12 Mar 2024, 11:21 PM IST