The Autorité de la concurrence publishes study on competition and e-commerce

Digital technologies have considerably changed the way commerce and distribution work. Internet sales are growing exponentially. Numerous offline retailers are now marketing their products and services online, and “pure play” retailers, almost exclusively active in internet sales, have emerged.  At the same time, digital technologies (e.g. smartphones, tablets, augmented technologies) are increasingly forming part of the sale experience in physical stores, to the point that there is now a “phygital” (physical and digital) model. 

In this context, the French Autorité de la concurrence, one of the most dynamic competition authorities when it comes to digital markets, published a study on the impact of e-commerce on competition policy, addressing the following question: how does the growth of online commerce impact the competitive dynamics in the markets and the behaviour of consumers and businesses? 

This study, which is only available in French at present (but will also be soon available in English), has two main aims.

First, by presenting the framework that the Autorité has used to analyse behaviour of companies in the field of e-commerce, it seeks to provide clarity to companies on their online practices and merger preparations. The study shows that in many cases, the Autorité must assess the extent to which online sales compete with in-store or agency sales. It may also need to adapt certain tools for assessing market power, such as calculating market shares, and may need to identify markets combining online and physical sales. 

Second, the study reiterates the interest of the French watchdog in adjusting its competition-enforcement tools in order to be able to deal effectively with challenges present in digital markets. This study thus forms part of a wider reflection led by the Autorité on the adaptation of its means of intervention to the specifics of these markets. The Autorité, inter alia, emphasizes the need for a wider use of interim measures and reinstates its willingness to consider the introduction of specific antitrust obligations and merger rules for large digital platforms.

The most interesting part of the study for companies involved in e-commerce (either as platforms and/or users) is Part II, which discusses a variety of potentially anticompetitive practices by market actors, including:

  • Conducts that can reduce the competitive pressure exercised by e-commerce, including price and non-price related measures.
  • Conducts that can distort competition between e-commerce platforms, including price-parity clauses in the hotel booking industry, exclusionary practices by dominant e-commerce platforms, etc.

The study also looks at regulatory frameworks than can harm the development of e-commerce, for instance in the transport and pharmaceutical sectors.

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