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CCI: Jurisdiction overlap ought to be harmonised for robust decisions

The CCI, in its key observations and findings of the telecom sector’s market study conducted by ICRIER, also notes the conflict between allowing access and protecting consumer privacy.

By: ENS Economic Bureau | New Delhi |
January 27, 2021 4:00:09 am
According to a senior CCI official, the competition regulator is likely to look at solutions such as data portability as a means of ensuring that a few companies holding significant amount of data does not result in entry barriers for fresh entrants into this growing sector.

The Competition Commission of India (CCI) has called for formal and informal lines of communication between the Telecom Department, telecom sector regulator Trai, the antitrust body and the envisaged Data Protection Authority to ensure robust and consistent regulatory decisions in a “complex data-centric converged” telecom industry.

The CCI, in its key observations and findings of the telecom sector’s market study conducted by ICRIER, also notes the conflict between allowing access and protecting consumer privacy.

The competition regulator said that abuse of dominance can take the form of lowering the privacy protection and, therefore, fall within the ambit of antitrust as low privacy standard implies lack of consumer welfare.

“Privacy can take the form of non-price competition. In the era of data aggregation, competition analysis must also focus on the extent to which a consumer can ‘freely consent’ to action by a dominant player,” the Competition Commission said in its report.

Further, according to a senior CCI official, the regulator is likely to look at solutions such as data portability as a means of ensuring that a few companies holding significant amount of data does not result in entry barriers for fresh entrants into this growing sector.

Additionally, for the digital sector, the CCI is looking to move away from a turnover-based threshold to a deal value-based threshold for companies to notify the regulator in case of a merger and/or acquisition (M&A).

The official said that in the digital sector, the asset/turnover-based notification thresholds have left potential enforcement gaps given that the companies being acquired may operate on a zero or low turnover, or an asset-light model.

To this extent, the competition watchdog has initiated another study on M&A deals in the digital markets to track the non-notified deals.

This is being done with an aim to identify trends and patterns of such transactions to provide an empirical basis for a legislative amendment to bring in the deal-value based threshold for the digital sector.

However, with regard to the telecom sector, the CCI has observed from the market study that the antitrust law framework is broad enough “to address the exploitative and exclusionary behaviour arising out of privacy standards, of entities commanding market power”.

“While overlapping jurisdiction between institutions cannot be completely eliminated, it ought to be harmonised through better regulatory design and improved lines of communication,” it noted, adding the CCI will remain the body to resolve antitrust and competition related issues.

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