ANDREY TSARIKOVSKIY: WHAT IS COMPETITION TODAY?

Participants of the VI BRICS Competition Conference discussed competition support on automotive markets

“We live in rather interesting time. Looking at the entire agenda, we see the huge significance of digitalization. It also concerns the automotive sector. In 2020, compared to 2015, the level of costs for digitalization in the automotive industry increased more than twofold, reaching over $82 billion.  The automotive industry is transforming into digital”, started his speech Stats-Secretary, Deputy Head of FAS Andrey Tsarikovskiy.

Today, the automotive industry is under a colossal crisis due to sales drop down all over the world. Moreover, the trend can continue: sociological studies shows that the young population today is becoming more mobile and give up property rights, particularly for cars.

“We frequently observe that cars increasingly often transform from property into a service”, says Andrey Tsarikovskiy. That is why totally “unorthodox” competitors – global digital companies such as “Google” and “Yandex”  have entered the car manufacturing market, traditionally operated by powerful car concerns.

Another trend pointed out by Deputy Head of FAS is that “like in many other industry sectors, alliances are being formed in the automotive sector. On the one hand, companies combine their efforts and technological achievements. On the other, a question emerges, whether they violated competition?”

Further discussing the trends towards companies association, Andrey Tsarikovskiy mentioned that recently antimonopoly bodies all over the world have been facing plenty of challenges to competition protection.

“We must strongly reconsider our work. We used to see competition and scientific-and-technological progress as inseparable. But what is competition today?” – wonders the speaker.

He reminded a story when two leading world aviation concerns emerged – “Boeing” and “Airbus”. It “decreased the number of market players, but at the same time we had competition for many years, resulting in technological progress and overall benefits for consumers. The same will happen in car manufacturing. But we must understand, where such associations of companies lead: to consumer benefits, scientific-and-technological progress or violations of competition”.

Andrey Tsarikovskiy emphasized that with new trends on the market the approach of the antimonopoly body to mergers. Considering mergers recently, FAS has judged from consumer benefits and development of scientific-and-technological progress.

He pointed out that “today FAS agrees to deals that we would not agree before. In these cases we issue multi-page orders to maintain the balance and competition on the market”.

Finally, Stats-Secretary, Deputy Head of FAS emphasized the importance of the so-called “soft regulation. He underlined:

“Applying the law is good and pleasant; it is nice to feel like a judge. However, the less and more careful is intervention of regulators in the economy, the more accents will be shifting from the efforts to eliminate violations to the actions to prevent them, the better and more efficient it will become”.