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UNCTAD Calls for more Global Cooperation to Enforce Competition Within the Digital Economy

As online platforms are global in nature, more regional and international cooperation is needed for effective enforcement of competition law in cross-border cases in the digital economy according to  an UNCTAD experts meeting on competition law and policy held from 7 – 9 July. This followed a survey by UNCTAD which found that the major challenges include definition of the relevant market and determination of dominance in digital markets. The Survey maps several areas of challenge. It says the dynamic structure of digital markets, zero-price services, network effects, market tipping, lock-in effects and multihoming are among the factors that require careful consideration when defining markets and determining market power.

The Survey also pointed out the lack of data available to competition commissions, and even when data can be collected, it is difficult to analyse digital market data, which requires special skills and expertise. For UNCTAD, this and other innovative ideas need to be fully explored to ensure open, competitive and fair digital markets for developed and developing countries. EFSA believes this argument cuts both ways, pointing to the ongoing SA Competition Commission’s market inquiry on the main SA ecommerce players which lack data to show the small size of the market compared to the total retail sector.

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Alastair Tempest

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