SUMMARY
- CCI has appointed MDIS to carry out an in-depth Market Study on AI and its effects on competition.
- The purpose of the Market Study is to cover six key areas.
- The US and EU are also examining the impact of AI on competition and are developing new regulatory approaches.
On September 13, the Competition Commission of India (CCI) announced that it has chosen the Management Development Institute Society (MDIS) to carry out an in-depth Market Study on Artificial Intelligence (AI) and its effects on competition. This decision was made after issuing a Request for Proposal (RFP) in April 2024, which was finalized with an agreement with MDIS on September 9, 2024.
The purpose of the Market Study is to cover several critical areas:
– It will examine various AI systems, their market structures, and their ecosystems. This includes pinpointing the main players in AI, the necessary resources, the flow of value, and the factors that determine competition.
– The study will look into potential competition issues that may arise in AI markets and ecosystems, and how these could affect the market’s overall behavior.
– The use of AI and its various applications will be explored to assess the opportunities, risks, and the impact on competition.
– The study will review the current and changing laws and regulations that apply to AI systems and their use in India and other significant countries.
– It will seek input from relevant parties to get a comprehensive view of how AI intersects with competition, making sure all viewpoints are taken into account.
– The study will examine trends in AI to help the Commission decide on its enforcement and advocacy efforts concerning AI and its applications in the market.
The CCI’s Request for Proposals highlighted the significant competitive advantages offered by AI, impacting both the supply and demand aspects across various sectors. However, it also raised concerns, such as algorithmic bias and the emergence of new forms of cooperation enabled by AI systems that learn on their own.
The CCI mentioned in the RFP that the research will explore the impact of AI-powered personalized recommendations, services, and pricing on consumer decisions.
The CCI has previously stressed the importance of managing AI’s dual role, acknowledging its capacity to improve efficiency while also highlighting the potential for anti-competitive behavior if not properly controlled. Bidders for the research were asked to present their proposals by June 3, with technical demonstrations scheduled shortly thereafter.
This development comes at a moment when the CCI has ramped up its attention to digital markets, including recent probes into digital market entities like Google, Flipkart, and Amazon India, among others.
Nations such as the United States and the European Union are also examining the impact of AI on competition and are developing new regulatory approaches to tackle these issues.
The AI research is a component of the CCI’s broader strategy for overseeing new technologies. Not long ago, it implemented new regulations mandating that digital companies with substantial operations in India obtain approval for mergers and acquisitions involving deals exceeding Rs 2,000 crore.
