The Internet and Mobile Association of India (IAMAI) has raised concerns about the proposed Digital Competition Bill, claiming that it will negatively affect Indian startups and other digital firms.

IAMAI represents a wide range of digital industries, including large IT companies. In its submission on the subject, the organisation stated that the new restrictions prevent venture capital investments in technology companies.

IAMAI said, “The proposed ex-ante regulations can dry up venture investments in tech startups, as the thresholds under the draft bill would act as a ceiling to the potential scalability of businesses.”

The report was brought to the Center on May 15, which was the deadline for comments on the measure.

In an attempt to preserve fair competition and level playing fields in the digital market, the law, which was introduced in March, seeks to better govern news aggregators and other large digital enterprises.

This proposition proposes ex-ante competition laws for large tech giants such as Amazon and Meta. Furthermore, the proposed bill stipulates that Systemically Significant Digital Enterprises (SSDEs) that offer “”core digital services (CDS)”” must carry out other obligations, such as treating business users and end users equally. CDS would cover online intermediation services like news aggregators.

The Digital Markets Act (DMA) of the European Union (EU), which was enacted into law in March of this year after a four-year consultation period, serves as the foundation for this bill.