The Competition Commission of India (CCI) feels that competition law remains a key instrument for addressing AI-driven anticompetitive practices.
Mergers, acquisitions, and other partnerships in the artificial intelligence (AI) ecosystem may need to be scrutinised for their "likely effect on competition", India's antitrust watchdog said in a market study of the AI sector released on Monday.
"The AI ecosystem is also witnessing partnerships amongst players across layers in the AI stack. These partnerships can spur growth and innovation by facilitating access to critical inputs, technologies etc. However, such partnerships in the AI space may also raise competition concerns under certain conditions,"
the CCI said.
It added that, for instance, exclusive partnerships might distort the competitive landscape by foreclosing access to essential resources, and that even non-exclusive agreements could create dependencies and lock-in due to high switching costs, thereby resulting in exclusionary outcomes.
The Management Development Institute Society (MDIS) was engaged to conduct the study. The objective of the work was to carry out a comprehensive analysis of key AI ecosystems, including stakeholders, resources, value chains, market structures, and parameters of competition.
According to the study, the adoption of AI in India is growing rapidly and is influencing market structures, business processes, and regulatory policy. The CCI has proposed several initiatives, including a conference on AI and regulation, advocacy workshops, and the establishment of a think tank focused on digital markets.
The study states that global regulatory responses to AI-driven competition issues are evolving to address both emerging and potential challenges. It adds that, since competition law is sector- and technology-agnostic, it is capable of addressing various AI-driven anti-competitive practices.
The report also recommends stronger inter-regulatory coordination, enhanced AI infrastructure access, and self-audits by companies to ensure competition compliance.
"Lack of transparency with respect to deployment of AI in decision making can harm competition and consumers. The enterprises are thus encouraged to adopt transparency measures to reduce information asymmetry,"
the study said.
Source: CCI
