SERGEY PUZYREVSKY: FAS HAS IDEAS ON COUNTERING MONOPOLIZATION OF DIGITAL MARKETS

The Antimonopoly Service emphasizes that importance of adopting the fifth “digital” antimonopoly package, establishing antimonopoly restrictions for digital giants

Speaking online at the special Petersburg International Legal Forum 9½: Rule of Corona, Deputy Head of FAS Sergey Puzyrevsky pointed out that to exclude market monopolization, the unity of economic space and free movement of goods, especially socially significant goods much be ensured to prevent shortage and monopolization.

Since the pandemic and its consequences are an additional incentive for developing e-commerce and strengthening the market power of digital platforms, adopting the fifth “digital” antimonopoly package of amendments to the Federal Law “On Protection of Competition” becomes especially urgent under these conditions.

The draft law bans monopolistic activity of the persons that own the largest digital platforms.

Deputy Head of FAS informed also about the importance of making amendments to the Federal Law “On Protection of Competition” in the part of setting antimonopoly requirements to agreements and actions for granting and using the exclusive rights on intellectual property items.

The document is drafted to protect competition on the markets in Russia and the interests of consumers in case of digital giants (the right-holders) abusing their exclusive rights. It proposes to apply the norms of the antimonopoly law to actions and agreements that lead or can lead to restricting competition and abusing dominance, as specified in Article 10 of the Civil Code of the Russian Federation.

“A complex of such measures will help us handle the economic situation without considerable monopolization of markets”, concluded Sergey Puzyrevsky.

Director of the Institute of Law and Development, Higher School of Economics – Skolkovo, Alexei Ivanov pointed out:

“Now, when all activities are moved online, digital companies are rapidly accumulating resources and becoming important players on all markets, catching more and more territories. We used to talk about the role of natural monopolies; now, under the pandemic a new type of natural monopolies is emerging – digital platforms – which is replacing the old ones. Their role is becoming increasingly more important in the modern economy, which has rapidly overcome the last mile of digital transformation in the course of the pandemic, and such strengthening of the online-element requires a completely different approach from regulators. If we miss the moment when digital giants become so powerful that we cannot already move them from the dominating position, we will lose as both the society and the civilization. We will be forced to live under the conditions of digital state planning. It will be an advantage for monopolists who will be able to build up their revenues, while consumers will lose.

It is essential to understand that competition is not simply an economic phenomenon; it is a constitutionally protected value and a set of ethical principles. Solving tactical tasks that we face due to the pandemic, we cannot “throw out” these key principles of a democratic economic system “with bathwater”.

Reference:

The Civil Code of the Russian Federation. Article 10. Limits of civil rights effectuation (as revised in № 302-FZ Federal Law of 30.12.2012) 1. Civil rights cannot be exercised exclusively with an intention to harm another person, circumventing the law to illegal purposes, as well as other knowingly mala fide effectuation of civil rights (abuse of rights).

Civil rights cannot be exercised for the purposes of restricting competition as well as to abuse the dominant market position.