This post is authored by Kshitij Sethi, a third-year student of B.A. LL.B. (Hons.) at Dr. Ram Manohar Lohiya National Law University, Lucknow.

Image from www.shutterstock.com


With a cloud of antitrust looming over Google in the U.S., many competitors are questioning its multiple roles in the vertical chain of its relevant product market. Reportedly, Google has quite recently banned many apps from circumventing its app store’s payment system to ask users to pay directly. Platforms like Google and Apple derive a 30% commission on the transactions that users make on apps of third-party developers. In response, developers such as Spotify and Epic Games, among others, have come together to form a coalition against tech giants such as Apple and Google which host app platforms in demand for a level playing field against the services offered by the hosting platforms themselves.

Similar trends in the online market may soon affect competition in the Indian context and a volley of antitrust cases might ensue. As a nascent market, the Indian online/e-commerce space is definitely too vulnerable to anti-competitive trends which may not be explicitly ruled out even after the potential enforcement of the Competition (Amendment) Bill, 2020 (‘the 2020 Bill’). The author also highlight the fact that in the absence of a data protection regime, the situation may get even worse with users paying unjust considerations vis-a-vis the services they may avail.


Google’s evolution from an internet search provider to something that is swallowing the web is concerning in the sense that, unlike previously, when it showed links to other sites on search, now, it displays the information that you search for from its own database, thus keeping you within its digital walls. Instead of being a doorway to a free and neutral web, it has now taken up the role of the house itself. The antitrust framework in India has only recently recognised the value of data in the age of information, but still, the 2020 Bill lacks the mention of data as being equivalent to price as a consideration. By controlling the information that you may be exposed to, companies like Google enjoy an unregulated leeway to control the equivalent of price in a supposedly competitive market.

On the other hand, companies like Amazon prioritise the display of ‘sponsored’ products in search results. This leads to a vicious cycle as the users tend to focus on top listings, and consequently, the most downloaded apps or the most visited websites get filtered to appear on the top in a search query. Unless users have the proper tools to lift the corporate veil, so to speak, they will continue to be robbed of their free choice in an online market. Such concerns regarding platform neutrality emanate when online platforms serve both as the marketplace and as competitors within the same.

Apart from harming platform neutrality, competition issues may also arise from other trends such as platform-parity clauses in agreements between sellers and platforms, tie-in arrangements, exclusive dealing agreements, and using dominant bargaining positions and countervailing power as intermediaries to impose conditions on sellers for providing deep discounts.

Another alarming trend is emerging in contravention of section 4(2)(e) of the Act in the face of many enforcements gaps in the competition regulatory framework as well as the merger control regime in India. Given that the Indian online market is in its nascent stage, the competitive significance of data increases manifold. For example, with respect to the potential lawsuit facing Google in the U.S., the Department of Justice is also scrutinising its advertisement business. It is to be noted that much of its dominance in the advertising industry comes from acquisitions, including the 2008-buyout of the ad-tech firm DoubleClick. The problem ensues when competition regulatory authorities undermine the significance of non-price factors such as data in mergers the clearance of which could potentially monopolise data as well as raise privacy protection concerns.

The recent purchase by Facebook of a nearly 10% stake in Reliance’s Jio Platforms raises similar concerns where both platforms enjoy a massive user base in the respective product markets. The U.S. Department of Justice stopped the merger of Bazaarvoice and PowerReviews in its tracks using the same line of reasoning. Not to mention, the recent battle between TikTok and the Trump administration in the U.S. has opened a Pandora’s box of issues related to users’ privacy protection with respect to companies with servers based in foreign jurisdictions. Where users may have opted to use a free service provided by a company in exchange for the data regarding their online behaviour and preferences, it may not be explicit whether they agree to reveal the same to other third-party stakeholders in the same.

As to the nascency of the Indian market, since the tech industry majorly operates on economies of scale, acquisition of small start-ups by dominant firms may not raise urgent antitrust issues given the small scale at which such start-ups operate, and thereby escape the watch of regulators, but such combinations are bound to potentially restrict competition. Added to that, while dominant firms acting as intermediaries focus largely on growing user base over profitability, the friction between their business model and those of the sellers which operate on them, largely including small-scale start-ups, causes the latter to get filtered out.

As mentioned before, this trend is also in striking contravention of section 4(2)(e) of the Act since the dominant companies may leverage their massive install base and incrementally add new products and services such as ride-sharing, food delivery, and payment services (eg. WeChat being termed a ‘super app’ in China).


Section 2(b) of the Act defines ‘agreement’ as “any arrangement or understanding or action in concert.” This definition is restrictive in the sense that it does not explicitly mention agreements made in a hub-and-spoke arrangement. In such a case, the algorithm of a ‘hub’ may serve to enable cartelisation by facilitating price determination, inter alia, and thereby, adversely affect the competition. Due to the lack of an explicit categorisation of such a cartel as being illegal per se, the NCLAT upheld CCI’S view in Samir Agrawal v. CCI & Ors. and ruled that algorithms of cab aggregators such as Uber and Ola do not result in the creation of an automatic cartel. It is the author’s strong opinion that in an age where AI-driven algorithms are imminent, hub-and-spoke cartels in the online market have to be identified using the ‘rule of reason’. Declaring them illegal per se would only serve to impede the growth of the online market by limiting innovation. While the 2020 Bill does expand the scope of the definition beyond vertical and horizontal agreements, hub-and-spoke agreements still do not find mention.

Sections 2(f)(ii) and 2(o) of the Act lack an explanation where personal data should be mentioned to be included as part of the consideration (non-price factor) paid to a company by users. Additionally, factors such as ‘control over data’ may be added as part of section 19(4) for determining the dominant position of a firm.

While the potential lawsuit against Google in the U.S. may be politically motivated due to the presidential elections, in India, especially in view of the above-mentioned enforcement gaps and its nascent online market, it is imperative that such lacunae must be addressed as soon as possible since any such anti-competitive trend if allowed to continue, or any acquisition or combination of any sort which may have the potential to monopolise data, which may not be alarming now, will potentially harm the competitive spirit of the online marketspace irreparably.


The author believes that it is high time to enforce regulation instead of solely relying on self-regulatory measures. We must strive to reform the antitrust process to reflect the changed reality of the digital market era where data collection and market power are irrefutably intertwined. Not to mention that as an effect of the lockdown, we will largely be dependent on the online marketspace in a post- COVID world.

Internet search providers like Google must display relevant search parameters to enable transparency in an age of information asymmetry, along with their policy on data collection and sharing of such data with its related entities or third parties. Other than that, search providers must not restrict users to their own services, but shall ensure that users may enjoy equal access to third-party links as well.

With the growing adoption of AI in algorithms, the challenge in identifying collusive behaviour due to tacit agreements would only increase. Although legislative intervention for ruling out autonomous algorithmic collusion is the need of the hour, care must be taken not to restrict innovation and technological advancement. Lastly, as far as the data protection of users goes, statutory agencies such as the proposed Data Protection Agency must necessarily coordinate with antitrust authorities in areas of mutual interest through consultation. In a market which is increasingly dependent on data to fuel growth, the current lack of a data protection regime in India poses many risks in the antitrust process.

Rajiv Gandhi National University of Law, Punjab

Sidhuwal - Bhadson Road,  Patiala, Punjab - 147006

ISSN(O): 2347-3827

© Rajiv Gandhi National University of Law Punjab, 2020

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