The Evolution of Antitrust in the Digital Era: Essays on Competition Policy – Vol. 2, David S. EVANS, Allan AO FELS, Catherine TUCKER (dir.)

David S. Evans, Allan Ao Fels, Catherine Tucker (dir.)

This section selects books on themes related to competition laws and economics. This compilation does not attempt to be exhaustive but rather a survey of themes important in the area. The survey usually covers publication over the last three months after publication of the latest issue of Concurrences. Publishers, authors and editors are welcome to send books to catherine.prieto@univ-paris1.fr for review in this section.

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The digital economy is expanding like the universe, as digital technologies spread to all areas of the traditional economy. The study of the digital economy must include an analysis of its competitive forces, both in legal and economic terms.

This book is a compilation of articles tracing the evolution of competition law and economics in the digital age. Edited by three economists, David S. Evans, Allan Fels AO and Catherine Tucker, it consists of two volumes. Only the second volume will be discussed in this article.

The book begins by putting into perspective the ultimate mission of competition law in the development of competition between digital businesses structured as platforms. From the outset, Jonathan B. Baker identifies the competitive forces at work and the obstacles arising from the presence of ultra-dominant platforms that can seize the competitive process. A synthesis between competition law and economic regulation seems to be preferred to reinvigorate current competition in digital markets.

The digital economy and its competitive aspects are examined by Pierre Régibeau, chief economist at DG Competition. He describes the organic characteristics of the digital economy and the economic challenges facing competition authorities, both in theory and in practice (pp. 77-86). A new conceptual area that is occupying competition authorities is that of the use of algorithms and the ensuing consequences in terms of cartels. John Moore, Étienne Pfister and Henri Piffaut, respectively economist, chief economist and vice-president of the French Competition Authority, demonstrate the validity of these potential risks and the solutions that can be found at this stage of knowledge (pp. 87-98). Two authors, Antonio Capobianco and Gabriele Carovano, revisit the current debate about the digital economy by linking it to digital technologies such as blockchain and explain how part of the authorities’ response to the challenge of competitive regulation (market surveillance, remedies) could come from integrating the latter into their toolbox (pp. 99-115)

The question of the conceptual framework of big data occupies a prominent place in the developments of the various authors. The empirical observation of the competitive practice of platforms and the mutations of digital markets is carried out with a sharp eye on how the business models of digital companies are deployed around digital data. Professors Lesley Chiou and Catherine Tucker demonstrate the relevance of the idea that the concentration of personal data could give their holders an exorbitant competitive advantage in online search markets (pp. 21-29). In the same vein, Alexander Elbittar and Elisa V. Mariscal undertake a substantive analysis of data capture in different digital markets. They intend to have identified the nature of the problems affecting competition in markets where algorithms act as competitive weapons in that their power to process and exploit data, not always accessible, is likely to generate unjustified dominant positions in the markets in question (pp. 193-209). As for the consideration of big data in non-horizontal merger cases, it is, in a limpid manner, dealt with by Professor Andy C. M. Chen, who tries to discuss the scenarios of harm to competition in the light of several data-driven mergers (pp. 229-257).

The platformization of digital markets undoubtedly generates negative externalities (censorship, hate speech, harassment, etc.) that affect not only platform users, but also third parties and society as a whole. David S. Evans addresses this thorny issue by focusing on the public and private regulation of such dysfunctions. He draws his reasoning from the economic theory of platforms but also from empirical observation of the behaviour of agents in the digital space. Platforms integrate these risks by means of internal regulation of the economic and social interactions that take place within them. However, as this regulation is not sufficient, the author believes that it should be supplemented by the public intervention necessary to overcome the limits of self-regulation (pp. 39-75). Three other authors focus on all the externalities of market digitalisation. They illustrate this through the example of the online advertising market (pp. 131-143). One of the typical cases of the innumerable negative externalities of the economic activity of digital platforms concerns the abuse of dominant position by Google and Facebook in their relationship with the Australian media (pp. 145-161).

Another area of debate is the possible under-enforcement of competition rules in digital markets, and more specifically in the case of mergers pursued by dominant digital entities. Robert Klotz (pp. 117-129) and Stephen P. King (pp. 163-179), in two separate but complementary articles, examine the truth of the assertion that there are gaps in the current provisions and implementation of competition law. In this way, they outline various avenues to be explored for a genuine reform of merger law adapted to the digital age.

The book is littered with foreign experiences from different legal traditions (for the case of Brazil, see pp. 181-191; for Japan, see pp. 219-228). However, they demonstrate that the rigorous test that authorities undergo in the theoretical understanding and regulation of digital markets remains more or less the same in all continents. Since the economic laws that govern and drive digital market players are universal and have effects that do not respect physical borders, an international response through close cooperation between competition authorities is required. It is on this condition that emerging countries could, in a world of globalized and interdependent economies, reap the expected benefits of the promises of digitalization (pp. 21-218).

The second volume of The Evolution of Antitrust in the Digital Era succeeds in bringing out the extreme complexity of the debate on competitive regulation in the digital economy. Simplistic solutions and prescriptions do not seem to convince the authors, who show great moderation as to the means of action to be mobilized in order to restore open, fair and practicable competition in digital markets.

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Author

  • University of Paris I Panthéon-Sorbonne

Quotation

Farouk Er-razki, The Evolution of Antitrust in the Digital Era: Essays on Competition Policy – Vol. 2, David S. EVANS, Allan AO FELS, Catherine TUCKER (dir.), May 2021, Concurrences N° 2-2021, Art. N° 100231, pp. 262-263

Publisher Competition Policy International

Date 1 February 2021

Number of pages 271

ISBN 978-1-9507-6968-1

Visites 497

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