Metadata by TLF: Issue 18

Welcome to our fortnightly newsletter, where our reporters Harsh Jain and Harshita Lilani put together handpicked stories from the world of tech law! You can find other issues here, and you can subscribe to Metadata by TLF here.

Streaming platforms and online news portals brought under the purview of the I&B Ministry

The Cabinet Secretariat issued a notification on November 11, 2020 granting the Ministry of Information and Broadcasting authority over streaming platforms and online news portals. Simply put, this means that platforms such as Netflix, Hotstar, Amazon Prime, etc. will now be under the jurisdiction of the I&B Ministry. While the I&B Ministry cannot regulate these platforms without specific laws being passed towards that end, the notification signals the intent of the government to bring out a regulatory code in the near future. Such a move was expected after Amit Khare, the Secretary of the I&B Ministry, expressed the Ministry’s intent to bring content streamed over OTT platforms under its purview. The online content sector, unlike radio, cinema and television, has till now remained free of censorship. In August 2020, more than a dozen OTT platforms operating in India such as Netflix, Zee5, Voot, Jio, SonyLiv, etc. had signed a self-regulation code aimed at empowering consumers with tools to assist them in making informed choice with regard to viewing decisions for them and their families but the I&B Ministry had refused to support the same.

Further Readings:

  1. Priyanka Sharma & Sampada Sharma, OTT platforms come under govt purview, content creators criticise move, The Indian Express (November 11, 2020).

  2. Statement: Today’s notification on online news media and OTT platforms will require greater vigilance #LetUsChill, Internet Freedom Foundation (November 11, 2020).

  3. Sushovan Sircar, Why Censorship Shadow Looms Over Online News & OTT Under I&B Min, The Quint (November 11, 2020).

  4. Aroon Deep, Summary: IAMAI's self-regulation code for Online Curated Content Platforms, Medianama (September 5, 2020).

WhatsApp gets the go ahead to start its UPI payments service

The National Payments Corporation of India allowed WhatsApp to start its UPI payments service, in India in a graded manner. Currently, the UPI ecosystem in India is dominated by two players, PhonePe and Google Pay, who control 80% of the market share. With a market base of over 400 million users and tie ups with ICICI Bank, HDFC Bank, Axis Bank, State Bank of India, and Jio Payments Bank, WhatsApp has the ability to dominate the other players in the ecosystem. However, at the same time that it gave the nod to WhatsApp, the NPCI also introduced a market share cap of 30% on UPI players beginning from January 1, 2021. This means that neither WhatsApp neither any of the existing platforms will be able to handle more than 30% of the total UPI transactions by volume starting 2021.

Further Readings:

  1. Pranav Mukul, Explained: What WhatsApp payments means to Indian users; who can use WhatsApp Pay?, The Indian Express (November 8, 2020).

  2. Advait Palepu, NPCI introduces market share cap of 30% on UPI players, Medianama (November 6, 2020).

  3. Advait Palepu, NPCI allows WhatsApp to roll out UPI services in a graded manner, Medianama (November 6, 2020).

  4. Neil Borate, WhatsApp Pay: Five things to know, LiveMint (November 6, 2020).

China unveils draft rules to curb monopolistic practices among internet giants

China unveiled new draft rules to root out monopolistic practices in the internet industry. The move comes in the backdrop of the EU and the U.S. also seeking to curb the power of internet giants. The new draft rules, unveiled by the State Administration of Market Regulation in a 22-page document, will attempt to stop companies from sharing sensitive consumer data, teaming up to squeeze out smaller rivals and selling at a loss to eliminate competitors. Under these rules, violators may be forced to divest assets, intellectual property or technologies, open up their infrastructure and adjust their algorithms. Local internet giants including Ant Group, Alibaba and Tencent could be amongst the firms that are most affected.

Further Readings:

  1. Zheping Huang & Coco Liu, China's clampdown on big tech puts more billionaires on notice, Bloomberg, (November 11, 2020).

  2. Staff, China to clamp down on internet giants, BBC News (November 11, 2020).

  3. Liza Lin, China Targets Alibaba, Other Homegrown Tech Giants With Antimonopoly Rules, The Wall Street Journal (November 10, 2020).

EU files charges against Amazon for breaking competition rules

European Union (EU) regulators filed antitrust charges against Amazon accusing the e-commerce giant of using data to gain an unfair advantage over merchants using its platform. The EU said Amazon had used data on third-party sellers that use its marketplace to boost sales of its own-label goods. It also launched a fresh probe into the possible preferential treatment of sellers that use the tech giant's logistics services. This would not be the first time Amazon has been accused of using its position as an operator of a marketplace to benefit itself as a seller within it. The EU’s investigation into the practice reportedly goes back more than two years. Amazon has denied any wrongdoing claiming that no other company cares for small businesses more.

Further Readings:

  1. Staff, Amazon charged with abusing EU competition rules, BBC News (November 10, 2020).

  2. Kelvin Chan, EU files antitrust charges against Amazon over use of data, The Associated Press (November 10, 2020).

  3. Jon Porter, Amazon reportedly faces EU antitrust charges over use of third-party seller data, The Verge (June 11, 2020).

  4. Press Release, Antitrust: Commission opens investigation into possible anti-competitive conduct of Amazon, European Commission.

Google accused of illegally protecting its monopoly over search and search advertising

The U. S. Department of Justice (DOJ) filed a lawsuit against Google accusing the tech company of abusing its position to maintain an illegal monopoly over search and search advertising. Eleven Republican state attorneys general have joined the DOJ as plaintiffs. According to the DOJ, Google has used its monopoly power to keep competitors out of the search distribution channels they need to scale up by entering intro exclusionary contracts with giants such as Apple. Essentially, Google pays mobile phone companies, carriers and browsers to make the Google search engine a preset default. That blocks competitors from being able to access the kinds of queries and traffic they’d need to refine their own search engine. While it’s not illegal to be a monopoly under U. S. law, it’s a violation for a dominant company to engage in exclusionary conduct to protect or strengthen its market power.

Further Readings:

  1. Cecilia Kang, David McCabe and Daisuke Wakabayashi, U.S. Accuses Google of Illegally Protecting Monopoly, The New York Times (October 20, 2020).

  2. David McLaughlin, Google Monopoly Case by U.S. Sets Stage for Multi-Pronged Attack, Bloomberg (October 20, 2020).

  3. Lauren Feiner, Google sued by DOJ in antitrust case over search dominance, CNBC (October 20, 2020).

  4. Jonathan Shieber & Ingrid Lunden, The Justice Department has filed its antitrust lawsuit against Google, Tech Crunch (October 20, 2020).

  5. Gilad Edelman, Congress Unveils Its Plan to Curb Big Tech’s Power, Wired (October 6, 2020).

CCI orders investigation into Google’s payment policies and preferential treatment to Google Pay

The Competition Commission of India (CCI) ordered an investigation into Google for abusing its dominant position to force app makers to exclusively use its billing system for in-app purchases and for the pre-installation and prominence of Google Pay on Android smartphones. The investigation has been launched based on an anonymous complaint, which is similar to the one filed against Google before the European Commission (EC). In that case, the EC had fined Google $5 billion for forcing Android phone manufacturers to pre-install the Google search app and the Chrome web browser. If it’s found that Google violated rules by forcing app makers to exclusively use its billing system for in app purchases, it would be a major victory for Indian startups which have been protesting against Play Store’s decision to charge a 30% commission for in-app sales. The CCI has the power to impose a penalty of up to 10% of Google’s turnover in the last three financial years if it finds wrongdoing on Google’s part in its investigation.

Further Readings:

  1. Advait Palepu, Competition Commission orders investigation in Google's App Store and GPay, Medianama (November 9, 2020).

  2. Tech Desk, Google Pay probe over dominance: What Competition Commission is investigating, The Indian Express (November 10, 2020).

  3. Yatti Soni, The Many Sides Of Google Play Store’s 30% Commission & India’s Search For Alternatives, Inc42 (October 2, 2020).

  4. Press Release, Antitrust: Commission fines Google €4.34 billion for illegal practices regarding Android mobile devices to strengthen dominance of Google's search engine, European Commission (July 18, 2018).