ANDREY TSYGANOV: REGULATIONS ON ACTIVITIES OF DIGITAL GIANTS WILL HELP TO ESTABLISH COMPETITION IN THIS SEGMENT

This point of view was expressed by the Deputy Head of the FAS Russia at the round table within the framework of the XV All-Russian science festival at the Faculty of Economics of the Lomonosov Moscow State University

During the discussion, experts talked about the dictatorship of digital giants: why their market power is growing and how to deal with it.

During his speech, Andrey Tsyganov, Deputy Head of the FAS Russia noted that in the top ten largest global firms seven are digital.

“According to many experts, leading digital companies are some of the most effective and ideal objects for investment. By 2030, if the economic growth of these companies continues, their share may reach about 2.5% of the country's gross domestic product. In this case, the possibility of political influence and other ways of influencing people will be much greater than it was a hundred years ago, - the representative of the Authority said. – But the companies that are at the top of this ten, suspiciously do not compete with each other. It seems that they have divided this market and at some points even help each other. This is a major monopolization of the sphere”.

Andrey Tsyganov noted that digital platforms are something without which it is absolutely impossible to imagine your life. These companies have made possible the level of globalization and the penetration of new technologies that exist now. But here is not only a positive side. Different groups of stakeholders operate in digital markets. Even if the final consumers are fully satisfied with the services of the largest digital companies, their relationships with smaller competitors, as well as with firms seeking to place their products on the basis of large platforms and other services, raise many questions from competition authorities around the world.

“It is necessary to move to the formation of reasonable tools for influencing digital companies in order to create comfortable conditions for all market participants. These rules are necessary. They will not bring anything fundamentally new to the companies ' activities. No one talks about structural separation and price fixing. So what should be done is to address issues related to macroeconomic assessments of the state of competition. For example, to understand why the rate of profit for some companies significantly exceeds the average rate of profit, which is formed in the economy as a whole,” the speaker stressed.

According to Andrey Tsyganov, experimental legal regimes (“regulatory sandboxes”) should include elements of antimonopoly regulation. At the same time, the development of rules of conduct for digital giants should allow them to take advantage of the potential of these companies and avoid freezing investment and slowing down technological progress.

The Deputy Head of the FAS Russia also emphasized that in the digital world there are three main categories of resources that digital market participants compete for: investors’ money, intellectual property, and consumer data. In his opinion, market assessments and calculations that are necessary for understanding the market power of companies should include an assessment of quality parameters. This will be the answer to the following questions: Why can one company attract billions of investment money, while others cannot? How many patent pools have digital giants created, and how many of the registered patents do they use, and how many are the dead weight so that no one gets them?

Andrey Tsyganov noted the relevance of existing approaches to the application of Antimonopoly legislation:

“There is a well known postulate that says: big does not mean bad… First of all, we do not evaluate the size of companies, but their behavior. And we do this according to clear criteria that are based on framework approaches that have developed in the theory of competition and are actively used in practice in many countries, and according to the rules that society and the state consider acceptable in order to ensure a balance of interests of all market participants,” he said.

The speaker believes that modern regulatory and law enforcement practices should be formed in cooperation with all market participants.

“Even if there are no such large-scale digital companies in Russia, nevertheless, processes are taking place, including the monopolization of the market. Dialogue with companies that are interested in having rules for regulating their activities in the Russian segment of the global digital market will help to promote competition in this area,” concluded Andrey Tsyganov.