The largest Russian digital companies and business associations have announced that they are preparing to join the concept of "Principles of interaction between participants in digital markets", approved by the Federal Antimonopoly Service (FAS) in 2021. This is stated in a letter addressed to the head of the FAS Maxim Shaskolsky, signed by representatives of the Association of Internet Trade Companies (including Ozon and Avito), Yandex, Wildberries CIAN and other market participants. The editorial office of Izvestia has the document.
The basic principles of interaction include five points:
- reasonable openness of digital platforms (in particular, free access to information about how search results are ranked);
- ensuring the independence of platform users when interacting with them;
- neutral attitude towards all parties of the market;
- participants should avoid "expansive and ambiguous" language in the rules of operation of digital platforms;
- participants should also help to ensure the rights of platform users, including by considering their requests and providing them with full answers.
The basic principles take into account the peculiarities of digital markets and their innovative development. They aim to create an institution of self-regulation, when market participants voluntarily, guided by the principles, do not carry out unfair practices in relation to consumers, competitors and other persons. In addition, the principles focus not only on the risks associated with competition but also on consumer protection. According to the Antimonopoly Service, the combination of state regulation and self-regulation is currently the most effective in digital markets.
The actual application of antitrust laws to anticompetitive practices, including by digital platforms, remains an important aspect of regulating digital markets, the FAS stressed.
“It is very good that the FAS has achieved a proactive position from the business. It's very good that the Federal Antimonopoly Service got businesses to take a proactive stance. The very fact that the major players came together on one platform and began discussing the principles of their own work is already a big breakthrough. The wall of silence and rejection that has long blocked the discussion about the regulation of digital platforms has been broken”,
said Alexey Ivanov, director of the BRICS Competition Law and Policy Centre.
Ozon believes that to create an open business environment, the activities of digital platforms should be based on the general rules of reasonableness and good faith, already enshrined in the "Principles of interaction between participants in digital markets." This document can consolidate the main fair and unfair practices in digital markets, as well as the mechanism for considering certain contentious issues on the basis of the FAS Expert Council, the company notes.
Alexey Ivanov stressed that the firm position of digital giants used to be that they do not need any special regulation to protect competition and do everything efficiently and correctly for the benefit of society and consumers.This presumption broke a few years ago, and discussions began around the world about what the antitrust regulatory mechanism for the digital economy should be, to curb the uncontrolled growth of market power of digital players and to stop manipulative practices against consumers. “The result of this growth could be the replacement of the digital marketplace with a digital Gosplan — planning and control, no longer by the state, but by private monopolies”, noted the expert.
Last November, Yandex entered into a settlement agreement with the Federal Antimonopoly Service and a coalition of IT companies in the case of SERP features - interactive widgets that appear on the search results page. According to the companies that applied to the antimonopoly department, the holding mainly showed its own services in the SERP features, making them more visible to users.
SERP features are used for interactive responses to user requests. Technically, they can be configured for use not only by Yandex-owned services. However, according to market participants, third-party companies are not given access to them.
“Virtually all key jurisdictions are reviewing their approaches to regulating the digital economy, from the U.S. to the European Union and China. In the U.S., the package of laws that was initiated by the Biden administration is now confidently passing Congress. China has passed a package of regulations, some of which are similar to the proposals we formulated back in 2018 as part of the Fifth Antitrust Package. In the European Union, the Digital Markets Act and Digital Services Act have already been approved by the European Parliament”,
said the director of the BRICS Competition Centre.
Alexey Ivanov believes that it is important to understand that these principles are not enough for the regulator to work with the new forms that market competition is taking on in the digital economy. "Principles alone are not enough to play "long-term" and protect competition in digital markets, which are becoming increasingly complex and have serious potential for negative consequences for sustainable economic development. The prescriptive, albeit basic and flexible, but accepted by business principles for organizing the digital economy, broadcast by the regulator, is a serious step forward, because the discussion on the Fifth Antitrust Package continues", stressed the expert.
In August 2020, Avito, IVI, Profi.ru, Zoon, Drome, Cyan, Tutu.ru and 2GIS applied to the FAS with a complaint about the restriction of competition. Yandex claimed that widgets are an international industry standard and do not have advantages over regular search results.
In April 2021, the FAS opened a case against Yandex for failure to comply with the requirements for search results tools.
On January 19, 2022, the FAS, the plaintiffs in the antimonopoly case and Yandex entered into a settlement agreement. Earlier on the same day, it became known that third-party services began to appear in enriched responses - special dedicated Yandex blocks - SERP features. The company has already tested the integration of e-books from Litres, mybook and book24, service announcements from Profi.ru and YouDo, hh.ru vacancies, films from Okko.