Startups sometimes faces challenges in growing due to big digital firms like Google, Apple, Facebook, Amazon and Microsoft as these companies do not operate in a neutral manner, said Ansuman Pattnaik, director general (IRS), Competition Commission of India.
He said that whenever required, the commission takes action in such cases to help start-ups. He assured startups that the commission is available for them to help them grow.
“Startups do face problems from the big digital firms. They are popularly said GAFAM, Google, Apple, Facebook, Amazon and Microsoft,” he said while speaking at a panel discussion on the regulatory landscape for start-ups during the Startup Mahakumbh in New Delhi on Saturday.
Pattnaik said that the big digital giants are very powerful due to access to huge data resources. They sometime do not perform in a neutral manner and resort to practices like self referencing in which they promote their products more in comparison to the products of the small firms.
“Because these firms are very powerful and they have rich resources of data, start-ups sometimes face difficulty in growing. That is a major challenge. They will promote their products rather than startups’ products. They will not allow start-ups to talk to each other directly. They do not perform in a neutral way. There are issues of platform neutrality also,” he said.
Pattnaik said that the commission has taken action in cases involving Google and Whatsapp. While Google was not allowing alternate payment processes through its app, Whatsapp was sharing all the data of its users and businesses to its principal firm Meta.
The commission has taken action in both the cases, he said, asking startups to reach out to the commission if they feel that they are being neglected, OR not given proper business processes by the big firms.
Raman Chopra, joint secretary (TPL-1), Central Board of Direct Taxes, said that giving tax incentives to start-ups is not in conflict with the government’s interest. Tax benefits help the companies grow and turn profitable. He said that if start-ups grow, they will ultimately contribute to taxes.
Prasenjit Singh, director general (investigation), Income Tax, was also present during the panel discussion. He said that the government is giving tax benefits to start-ups to reduce compliance burden.
