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Competition Commission of India Aims to Tackle Digital Economy Challenges

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In a bid to safeguard consumer interests amidst the rapid evolution of the digital economy, the Competition Commission of India (CCI) is intensifying its focus on emerging areas within this realm. CCI Chairman Ravneet Kaur, speaking at the 15th Annual Day of the CCI, emphasized the necessity for the enforcement of competition law to adapt to the innovations in the digital space.

Kaur highlighted concerns over the “opacity of algorithms” and the “data dominance” wielded by digital firms, identifying these as potential challenges for regulators worldwide. She expressed worries about the role of algorithms in shaping user experiences and pricing decisions, stressing the difficulty regulators face in assessing their impact on competition due to their opacity.

The CCI chairperson also took aim at big tech giants, asserting that their control over vast amounts of online data could create significant barriers to entry for new players, potentially leading to market domination by a few companies. She underscored the tendency towards market concentration in digital markets, fueled by network effects where the value of services increases with user participation.

Moreover, Kaur raised concerns about business models prevalent in digital markets, where a single entity controls access to multiple services, potentially compromising platform neutrality. She noted growing apprehensions that digital platforms may unfairly favor their own services or products over those of competitors.

In response to these challenges, the CCI is gearing up to launch a market study on artificial intelligence (AI) to gain a deeper understanding of its implications on the digital landscape. This initiative aligns with the government’s efforts to formulate a new digital competition bill, with recent public consultations on the draft bill concluding on May 15. The Ministry of Corporate Affairs is poised to evaluate the feedback received and formulate the proposed regulatory framework accordingly.

As the digital economy continues to evolve, the CCI remains committed to fostering a competitive environment across all sectors while addressing the unique challenges posed by digital transformation.

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