Competition Commission of India Initiates Market Study on AI's Impact on Competition

CCI ropes in agency to conduct market study on AI

Even as regulators around the world are grappling with the rising threat of Big Tech firms, the Competition Commission of India (CCI) on Friday has chosen Management Development Institute Society (MDIS) to conduct market study on artificial intelligence (AI) and competition. The terms of the contract with MDIS includes understanding of certain key AI systems, stakeholders, value chains, and market structures, etc. "The objectives of the study is to examine the emerging and potential competition issues in these markets, and to study the scope and nature of AI applications, and assess associated opportunities, risks and ramifications from a competition standpoint," the official statement said. In April this year, the competition watchdog had invited proposals for the study. "The transformative capabilities of AI have significant pro-competitive potential, both on the supply and the demand side. At the same time, there may be concerns with regard to potential competition risks stemming from the use of AI. The proposed study will be a knowledge building exercise to develop an in-depth understanding of the emerging competition dynamics in the development ecosystems of AI systems and implications of AI applications for competition, efficiency and innovation in key user industries," the tender notice said. Meanwhile, rise of Big Tech is forcing regulators around the world to re-look at their existing laws. For instance, in the EU, the Digital Markets Act, AI Act, Digital Services Act are being designed to regulate tech firms. In India too, the ministry of corporate affairs (MCA) is in the process of framing the digital competition bill that will look into anti-competitive conduct of the Big Tech with an ex-ante approach.

CCI Ropes In MDIS To Conduct Market Study On Impact Of AI On Competition

Findings will help guide India's regulatory decisions, balancing AI innovation with fair competition The Competition Commission of India (CCI) has roped in Management Development Institute Society (MDIS) to conduct a market study to ascertain the impact of artificial intelligence (AI) on competition. In a statement, the antitrust regulator said that it formalised the partnership with MDIS after floating a request for proposal (RFP) in April 2024. Subsequently, an agreement was signed between the two parties on September 9, 2024. The study will cover six primary objectives, including examining competition issues in AI markets and understanding existing regulatory frameworks in India and other key jurisdictions. Specific areas of focus include how AI applications influence competition through aspects such as pricing, mergers and acquisitions, and personalised services, which could either benefit or harm consumer welfare. The findings from the study are expected to guide regulatory decisions in India, shaping the future of AI in terms of fostering innovation and maintaining fair market practices. The study will encompass six objectives: The CCI's RFP had underlined AI's "substantial procompetitive potential," affecting both the supply and demand sides of various industries. It, however, also flagged concerns, including bias in algorithms and new forms of collusion made possible by self-learning AI systems. "The study will examine how AI-driven personalised recommendations, services, and pricing influence consumer choices," the CCI said in the RFP. The CCI previously also emphasised the need to address the dual nature of AI, noting its potential to enhance efficiency but also posing risks of anti-competitive outcomes if left unchecked. Bidders for the study were invited to submit proposals by June 3, with technical presentations taking place soon after. This comes at a time when the CCI has increased its focus on digital markets, including recent investigations into digital market companies such as Google, Flipkart, Amazon India, among others. This is part of a growing trend among regulators worldwide. Countries like the United States and the European Union are also investigating how AI affects competition and exploring new regulatory frameworks to address these challenges.

Competition Commission of India engages Management Development Institute Society for market study on artificial intelligence and competition

The Competition Commission of India (CCI) has taken a significant step towards understanding the competition dynamics in artificial intelligence (AI) markets by appointing the Management Development Institute Society (MDIS) to conduct a comprehensive market study on AI and its impact on competition. This marks a strategic initiative by the CCI to delve into the rapidly evolving AI landscape, with potential implications for businesses and consumers alike. The selection of MDIS comes after a formal Request for Proposal (RFP) was issued earlier in April 2024, soliciting interest from leading institutions to lead the study. After a thorough evaluation process, MDIS was chosen, and a formal agreement was signed between CCI and MDIS on September 9. The study reflects CCI's ongoing commitment to ensuring fair competition in India's rapidly evolving digital and technology markets. Objectives of the AI Study The primary goal of the study is to provide a deeper understanding of how AI systems and related markets operate within India, focusing on key stakeholders, market structures, and the competitive dynamics involved. The study will focus on understanding the different AI systems, including the actors involved, essential resources, value chains, and the parameters that define competition within AI ecosystems. The CCI seeks to identify potential competition concerns in AI markets. With AI being integrated into various industries, there is a growing need to assess whether certain market structures or practices are hampering competition or creating monopolistic behaviour. Another critical focus will be to analyse the applications of AI and understand both the opportunities and risks it presents, particularly from a competition perspective. The study will explore how AI's growth may influence market behavior and competition. Also read Centre expands CCI's deal scrutiny window via new 'deal value threshold' provision India enforces mandatory CCI approval for M&As over ₹2,000 crore under new regulations Given AI's dynamic and global nature, the study will examine the regulatory and legal frameworks governing AI in India, as well as major international jurisdictions. This will provide insights into how Indian regulations compare globally, offering guidance for potential updates or reforms. The CCI will engage with relevant stakeholders, including industry players, policymakers, and consumer groups, to gain a comprehensive understanding of the competitive landscape shaped by AI. The study aims to track AI trends and patterns, enabling the Commission to establish clear enforcement and advocacy priorities in relation to AI applications. This will help the CCI stay ahead of potential competition issues in AI-driven markets. A Strategic Initiative Artificial intelligence is reshaping industries across the globe, raising critical questions about competition, consumer protection, and regulatory frameworks. This study signals the CCI's proactive approach to understanding and addressing the challenges posed by AI's growing influence in various sectors. The findings are expected to provide a foundation for the Commission's future policies and enforcement actions, ensuring AI innovation thrives in a competitive and fair marketplace. By engaging MDIS, one of India's leading research institutions, the CCI is reinforcing its dedication to safeguarding competition in an era of technological transformation. As AI continues to permeate industries such as healthcare, finance, e-commerce, and logistics, this market study will likely have far-reaching implications, shaping the future regulatory landscape. The study is expected to take a holistic approach, combining economic, technological, and legal perspectives to provide actionable insights. It is anticipated that the findings will support both the Commission's enforcement efforts and its advocacy initiatives as India continues to embrace AI-driven growth. With artificial intelligence set to play an increasingly pivotal role in shaping the future of industries, CCI's partnership with MDIS is a timely intervention aimed at understanding AI's influence on competition. The results of this study will provide a crucial roadmap for policymakers, businesses, and regulators to navigate the opportunities and challenges posed by AI in India's marketplace. For businesses and consumers, this move by the CCI offers a reassurance that emerging technologies like AI will be monitored closely to prevent any adverse effects on competition, while fostering innovation and growth in the Indian economy. SHARE Copy linkEmailFacebookTwitterTelegramLinkedInWhatsAppRedditPublished on September 13, 2024

CCI selects Management Development Institute to conduct market study on AI

Fair trade watchdog CCI has selected the Management Development Institute Society (MDIS) to conduct a market study on artificial intelligence and competition that will examine various aspects, including potential competition issues in the AI ecosystems. In April this year, the Competition Commission of India (CCI) had issued a request for proposal to conduct the market study on Artificial Intelligence (AI) and Competition. Click here to connect with us on WhatsApp The Gurugram-based MDIS has been engaged to conduct the study that will seek to understand certain key AI ecosystems, including stakeholders, resources, value chains, market structures and parameters of competition, CCI said in a release on Friday. It will also examine the emerging and potential competition issues in these markets/ecosystems as well as look at the scope and nature of AI applications/use cases, and assess associated opportunities, risks and ramifications from a competition standpoint. Among other aspects, the study will focus on the existing and evolving regulatory/legal frameworks governing AI systems and applications in India and other major jurisdictions. Earlier this year, in an interview to PTI, CCI Chairperson Ravneet Kaur said AI and machine learning can drive efficiency and innovation but also raise concerns related to market concentration and potential anti-competitive behaviour. Also Read CCI gives nod to Dixon Technologies to acquire stake in Aditya Infotech Digital firms with Rs 500 crore turnover must seek CCI approval for M&As M&A deal value of over Rs 2,000 crore comes under Competition Act CCI gives nod to $8.5 bn Disney-Reliance media assets merger deal Aiming to enhance efficiency, CCI proposes changes to recruitment rules