CCI chief D K Sikri today pitched for revisiting the uniform threshold framework under competition law for M&As, saying the current system based on assets and turnover of companies might have a "blind spot" when it comes to deals in the digital space.
He also said the regulator would be writing to the government proposing changes in the threshold framework for M&A transactions.
Mergers and acquisitions beyond a certain threshold require approval from the Competition Commission of India (CCI). At present, there is a uniform criteria across sectors in terms of deciding on whether a particular deal need the regulator's nod.
Sikri said that a firm legal framework for data protection is the foundation on which data-driven innovation and entrepreneurship can flourish while also keeping personal data of citizens secure.
"Merger between companies that hold big data would allow the resultant entity to have even more tools to profile individuals and invade privacy. It is well known that many large tech companies require other companies with the primary objective of having access to data owned by that firm. In most of these cases, the deal size is strikingly high, reflecting essentially the value of the data owned by the target company," he said at a conference here.
According to him, since data is not accounted for as an asset, "the traditional asset (and) turnover criteria under competition law might fail to capture those transactions during review. That is our worry".
"This is because targets in these sectors have limited actual turnover or physical assets. That is asset, turnover base notification threshold which we have in force in the country, in the digital sector they may have a blind spot. If relied on solely, we will not be able to take stock and evaluate them in mergers," the CCI chairperson said.
Speaking at a conference organised by industry body Assocham, Sikri also noted that probably time has come to revisit the desirability of uniform threshold across sectors and pitched for sector-wise thresholds.
"We are just proposing... We are writing to the (Corporate Affairs) Ministry," he told PTI on the sidelines of the conference.
The regulator comes under the administrative control of Corporate Affairs Ministry.
Stressing that there needs to be a balance in terms of embracing social benefits of big data and avoiding harm to individuals, Sikri said, "transparency, accountability and informed consent are going to be the key words".
He also said that rapidly evolving data landscape and more and more data centric businesses are posing colossal challenge. "They are altering the traditional parameters of regulation. They are making the regulators develop innovative perspective on how to apply the existing instruments and devise new tools wherever necessary," he added.
Emphasising that regulations and regulators have to work in tandem, Sikri said there could be potential abuse of dominance case, which might also involve breach of data protection issues.
"There should be then appropriate remedies which could address both anti-competitive practices and data (issues). Authorities responsible for data protection in the digital economy will have to have a continuous dialogue to ensure that a cohesive regulatory architecture is in place for most efficient digital markets. In this quest, industry will have a significant role to play," he said.
In his address, Law Secretary Suresh Chandra said that by creating a good data protection law, India could extend well beyond being a mere supplier to the world's multi-national corporations.
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