Apr 22, 2020

Recent developments in big tech regulation in India


India has emerged as a hub for digital and technology markets in a relatively short space of time, with a series of government initiatives providing necessary stimulus.[1] This rapid development has been accompanied by keen regulatory interest, particularly from the CCI.

Like its counterparts in other jurisdictions, the CCI is currently grappling with the larger debate of whether its intervention in digital markets is justified where evidence of harm empirically exists, or to revise the existing framework of the Competition Act, 2002 in anticipation of potential concerns with digital market practices. A review of the CCI’s big tech decisions seems to suggest it is wary of using the Act as a primary tool in regulating access to Big Data by technology companies.[2] Although it is closely scrutinising this sector,[3]  thus far, the CCI appears to have opted for a ‘wait and see’ approach over active interference.[4]

In this article, we examine the CCI’s decisions in practice with a view of discerning future enforcement trends in digital and technology markets. In particular, we examine whether competition regulation is leaning towards equipping the Act with new theories of harm to govern perceived concerns with market power in platform markets or decidedly focusing its enforcement on maximising consumer welfare.

Antitrust and the digital sector: a review of the CCI’s decisions in practice

The concern with big tech appears to be largely on account of concentration of market power in the hands of a few. As a result, the CCI’s enforcement practice in the digital and online markets has primarily been under provisions governing abuse of dominance. In India, this analysis is made more complicated by the language of the Act, which identifies certain conduct by a dominant enterprise as a per se violation, regardless of whether the conduct actually harms competition. That said, more recently the CCI appears to have included an ‘effects analysis’ in its abuse of dominance decisions.[5] This is examined in greater detail below.

Market definition

Although the CCI has examined practices of digital platforms, its approach to market definition and in particular, online platform markets, continues to evolve. In the Flipkart case,[6] the CCI considered the two-sided nature of Flipkart’s business to define the market as ‘services provided by online marketplace platforms’. Yet, in Matrimony.com v Google[7] (Google Search case), despite noting that Google operated in a two-sided platform market, where one side (search) would not exist without the other (advertising), the two-sided nature of Google’s search and advertising model was rejected in favour of two separate relevant markets of ‘online general web search services’ and ‘online search advertising services’.

In doing so, the CCI further distinguished between online and offline markets. Most recently, in RKG Hospitalities Pvt Ltd v Oravel Stays Pvt Ltd (‘Oyo Rooms’),[8] which concerned allegations of abuse of dominance against Oyo Rooms, an online budget hotel aggregator, the CCI defined a ‘single side’ of the market, i.e., for ‘franchising services for budget hotels’, this time, including both online and offline companies. Notably, while each of these decisions involved players functioning in online platform markets that exhibited a sufficient degree of indirect network effects, the CCI’s closure decisions in Flipkart and Oyo concerned emerging home grown tech companies. Given this background, it may be difficult to predict the likelihood that the CCI will define a single product market based on the extent of network effects exhibited.

Evolving metric for establishing ‘market power’ and dominance

In the tech sector, the competition regulators’ go-to proxy of using ‘market shares’ to assess dominance[9] has been replaced by user data. In the Google Search case, the CCI noted that Google is compensated by ‘eyeballs’, that is, user data acts as consideration for its search services.[10] The CCI likened ‘data’ to the value of ‘oil’ in the 20th century. While the CCI, like most antitrust enforcement agencies, identifies access to user data as a key driver in digital and platform markets (see Google Search case), the CCI’s concern with access-related market power appears somewhat allayed in cases where there is evidence of sufficient multihoming by users. For example, in separate allegations of abuse of dominance against WhatsApp[11] and domestic cab aggregator, Ola,[12] the CCI held that users regularly and seamlessly multihome between multiple service providers. Per the CCI, this ease of multihoming, exercises sufficient competitive constraints to counter concerns with data aggregation. The CCI is also not averse to examining competitive constraints from offline players when examining dominance of online players.[13]

Significantly, while the CCI has increasingly noted the role of data and related network externalities, Big Data and its nexus with abuse of dominance is yet to become a central theme in a CCI final order.

Is big tech exploitation per se an antitrust issue?

As with other antitrust statutes, the Act proscribes certain ‘exploitative’ (imposition of unfair terms, predatory and excessive pricing) and ‘exclusionary’ conduct (denial of market access, leveraging) under its abuse of dominance provisions. However, the CCI appears to have more recently applied a different infringement standard for both sets of conduct, that is, a per se standard of harm for exploitative conduct and an additional ‘effects analysis’ when reviewing cases of exclusionary conduct. Below, we examine the implications of this two-fold approach in digital markets.

In the Google Search case,[14] the CCI found that: (1) the position of the commercial unit for Google Flights at the top of the page affects the visibility (and subsequent performance) of other search/travel websites; and (2) the ‘more search results’ link at the foot of the unit leads users to Google’s specialised search results page, depriving them of additional choices. The CCI’s remedy was to direct Google to label the ‘more search results’ link adequately, as leading to a Google result page. Despite the CCI’s first finding and to some extent its second finding specifically identifying exclusionary conduct/harm, the CCI found Google liable only under the provision proscribing exploitative conduct. Notably, the minority dissent order disagreed with the majority order on account of lack of any evidence of users being misled.

The CCI’s interpretation above seems to suggest that any form of conduct by a dominant entity which may be viewed as exploitative of users is likely to fall foul of the Act, without necessarily testing for empirical evidence of harm. In a recent decision,[15] the CCI explicitly stated that when dealing with cases involving exploitative conduct inflicted on a consumer, ‘the mere existence of such conduct’ may be sufficient to qualify as abuse of dominance under the Act. Going forward, this may introduce some degree of uncertainty particularly for digital and platform markets that experiment with varied business models. For example, for a two-sided platform, conduct on the B2B (business- to-business) side, in relation to suppliers or advertisers, may be viewed as exploitation on the B2C (business-to-consumer) side, for example, deprivation of choice.

Regulating big tech in the absence of ‘single player’  dominance

Absent ‘dominance’ by any one entity, any other potential conduct may be scrutinised as ‘anti-competitive’ agreements, that is, either vertical arrangements (that also requires the existence of market power) or cartel arrangements. The Act does not recognise the concept of ‘collective dominance’.

A majority of digital and platform markets in India involve duopolies or close- knit oligopolies. Absent dominance by any one entity, alleged anti-competitive practices employed by two or more of these entities may be investigated under the cartel provisions of the Act, which in turn must involve an element of collusion. For instance, in a complaint against the two most popular ride hailing apps,[16] absent any empirical evidence of collusion, the CCI rejected allegations that cross shareholdings in Ola and Uber led to tacit collusion in conduct. Similarly, against other allegations[17] that Ola and Uber were independently acting as hubs to facilitate collusion among their driver-partners (spokes) by way of algorithmic pricing, the CCI rejected this allegation for lack of any evidence of collusion.

On the other hand, the CCI has examined restraints involving platform markets purposefully to ensure that they don’t escape scrutiny where required. In Jasper Technologies v KAFF Appliances,[18] when examining allegations of resale price maintenance on an e-commerce platform company, the CCI held that sellers on an online marketplace are part of a distribution chain. Accordingly, while there may not be a traditional buyer-seller relationship between the seller and the e-commerce platform for a ‘re-sale’ to exist,[19] they are nevertheless ‘vertically linked’.[20] Any such restriction in allowing discounts on e-commerce platforms may therefore legitimately be scrutinised as resale price maintenance restrictions under the Act.

Reconciling disruptive technology with exclusionary effects

More recently, the CCI appeared to have adopted a ‘duty to deal’ approach while directing an investigation against Intel, mindful of its position in the market for the supply of processors in India.[21] The CCI took objection to Intel failing to provide design files to the informant while making them available to at least one other well-established OEM (original equipment manufacturer). The CCI preliminarily held that Intel had denied market access and limited the development of technology. The CCI’s decisional practice, particularly when examining exclusionary conduct in digital markets, appears to be driven by policy: encouraging the development of home grown ‘unicorns’ and examining the extent of existing consumer benefit.[22] It also tends to take a more conservative view when examining the conduct of integrated technology players, assuming that such markets are ‘tipping’ markets.

While some conduct may well be deserving of intervention, an approach that assumes all forms of strategic/vertical integration, expansion or development to be anti-competitive or exclusionary when taken by established players, without empirically testing for harm to competition or consumers, may well come at the cost of innovation.

Take for instance, concerns over ‘killer acquisitions’. This is a strategy employed by digital giants to thwart any challenge to their market position and the consequent debate involving the introduction of a new set of thresholds to catch such acquisitions that currently escape scrutiny on account of low turnover. To test this, consider Facebook’s acquisition of Instagram, where the latter’s popularity has only increased post acquisition. Moreover, the rapid growth of Facebook’s competing apps, such as ByteDance’s Tik Tok, gives pause to the call for premature blocking of tech acquisitions. The regulator is also not precluded from taking up post facto actions, should problematic acquisition(s) adversely affect competition.

Accordingly, as is the case with every other new industry, there is a need to evaluate the pace of antitrust intervention in the digital sector, given existing product and service dynamism, transitional consumer preferences and ability to multihome. Significantly, strong network effects are the very essence of platform markets. Accordingly, any theory of harm should be measured against conduct that actively or/ and unfairly seek to preclude challenges to creating an alternate network. Acquisitions that seek to strengthen such network effects, should not, in and of itself, be construed anti-competitive. On the other hand, regulators must stay vigilant to intervene when exclusionary conduct has the actual or likely effect of preventing competition.

The CCI has the challenging mandate of balancing antitrust enforcement without impeding innovation or growth in ‘India Tech’. Although it is important for any young regulator to imbibe and implement global best practices, it is equally critical for the CCI to be mindful of the peculiarities, stage of development  and competitive conditions of the Indian market. Given the CCI’s wide-ranging powers, it is imperative for the CCI to adopt an evidence-based approach when examining conduct. The CCI’s preliminary findings following its in-depth e-commerce market inquiry suggest it is leaning towards a cautious rather than interventionist approach.

This article first appeared in the December 2019 issue of Competition Law International (Vol 15, No 2), and is reproduced by kind permission of the International Bar Association, London, UK. © International Bar Association.

Aditi Gopalakrishnan, Partner
Hemangini Dadwal, Partner


1. For example, the government has introduced the Digital India Initiative to improve internet connectivity, and digitise several government  services.

2. Unlike other jurisdictions, the CCI is yet to examine privacy as an antitrust concern.

3. CCI has investigated several big tech companies, including a five-year long investigation against Google, case Nos 7 and 30 of 2012, available at: https://www.cci.gov.in/sites/default/files/07%2%2%2030%20of%202012.pdf; and a recent initiation of investigation against Android, case No 39 of 2018, available at: https://www.cci.gov.in/sites/default/files/39-of-2018. pdf; cab-sharing services, Uber and Ola case Nos 6 and 74 of 2015, available at: https://www. cci.gov.in/sites/default/files/6%20&%2074%20of%202015.pdf; and online marketplace, Snapdeal, case No 61 of 2014, available at:  https://www.cci.gov.in/sites/default/files/61-of-2014.pdf. Further, the CCI is currently undertaking a market study on e-commerce in India, see https://www.cci.gov.in/sites/default/files/press_release/ccipress.pdf.

4. In All India Online Vendors Association v Flipkart (Flipkart case), case No 20 of 2018, available at: https:// www.cci.gov.in/sites/default/files/20-of-2018.pdf, the CCI noted that ‘the marketplace based e-commerce model is still a relatively nascent and evolving model of retail distribution in India and […] any intervention in such markets needs to be carefully crafted lest it stifles innovation.’

5. M/s ESYS Information Technologies Pvt Ltd v Intel Corporation (Intel case), case No 48 of 2011, paragraphs 8.3.6, 19, available at: https://www.cci.gov.in/sites/default/files/482011_0.pdf; Bharti Airtel Ltd v Reliance Industries Ltd, case No 3 of 2017, paragraph 22, available at: https:// www.cci.gov.in/sites/default/files/3%20of%202017.pdf; Tata Power Delhi Distribution Ltd v NTPC Ltd, case No 20 of 2017, paragraph 33, available at: https://www.cci.gov.in/sites/default/ files/20%20of%202017.pdf.

6. Paragraphs 20–24.

7. Case No 7 and 30 of 2012, paragraph 97. In the interest of transparency, the authors represented Google before the CCI, and presently before the appellate tribunal.

8. Case No 3 of 2019, paragraphs 35–40, available at: https://www.cci.gov.in/sites/default/ files/03-of-2019.pdf.

9. Belaire Owners’ Association v DLF Ltd, case No 19 of 2010, paragraph 12.78, available at: https:// www.cci.gov.in/sites/default/files/DLFMainOrder110811.pdf; HT Media v Super Cassettes, case No 40 of 2011, paragraph 178, available at: https://www.cci.gov.in/sites/default/files/C-2011-40_0.pdf; Ramachandran v JSW Cements, case No 76 of 2017, paragraph 14, available at: https://www.cci.gov.in/sites/default/file/Case%20No.%2076%20of%202017.pdf.

10. Paragraph 84.

11. Vinod Kumar Gupta v WhatsApp Inc (‘WhatsApp case’), case No 99 of 2016, paragraph 10.

12. Fast Track Call Cab Pvt Ltd v ANI Technologies, case Nos 6 and 74 of 2015, paragraph 94.

13. Cloudwalker Streaming Technologies Private Ltd v Bennett, Coleman and Co Ltd, case No 46 of 2015, paragraph 14.

14. Google Search Case, paragraphs 420(b) and 422.

15. Indian National Shipowners’ Association v Oil and Natural Gas Corporation Ltd, case No 1 of 2018, available at: https://www.cci.gov.in/sites/default/files/01-of-2018.pdf.

16. Meru Travels v ANI Technologies (‘Ola’) and Uber India (‘Uber’), case No 25-28 of 2017.

17. Case No 37 of 2018, available at:   https://www.cci.gov.in/sites/default/files/37of2018.pdf.

18. Case No 61 of 2014, (‘Jasper case’), available at: https://www.cci.gov.in/sites/default/files/61- of-2014.pdf.

19. The new rules for e-commerce, introduced in February 2019, prevent marketplace platforms from selling products through companies, and of companies, in which they hold an equity stake.

20. The Jasper case.

21. Notably, the conduct related to Intel’s refusal to supply designs files adequately to manufacture server boards (in which Intel is not dominant) to make them compatible with Intel processors. The CCI defined the relevant market as processors, holding that the market should be one ‘where the actual conduct took place, and not one where the ultimate effect may be caused.’ Strangely, the conduct was also concerned with the non-supply of designs for manufacturing server boards.

22. The informant claimed to be the only indigenous player looking to enter the market to manufacture server boards in India.





These are the views and opinions of the author(s) and do not necessarily reflect the views of the Firm. This article is intended for general information only and does not constitute legal or other advice and you acknowledge that there is no relationship (implied, legal or fiduciary) between you and the author/AZB. AZB does not claim that the article's content or information is accurate, correct or complete, and disclaims all liability for any loss or damage caused through error or omission.