Competition czar’s warning for tech giants

In December last year, Ms de Silva hit Google with a €150 million ($246 million) fine for abusing its market power through its Adwords platform.

It alleged the tech giant’s platform had opaque rules that were changed frequently, applied inconsistently and had the potential to discriminate against advertisers; the complainant in the case had its accounts summarily suspended by Google.

In addition to the fine, the Autorité hit Google with an injunction requiring it to make rule changes on the Adwords platform more transparent and objective.

Ms de Silva said this was an example of the way competition regulators needed to be innovative in the way they promote competition and protect consumers.

“Giving a fine is important in terms of deterrence, but in some cases, we must move a little bit more in terms of how you change the rules so that you find that competition works.”

Google is taking the decision to France’s Court of Appeal.

Ms de Silva said there was plenty of scope for the French watchdog to use existing laws against tech giants where necessary, and emphasised that big companies should not be demonised because of their size.

But she said competition regulators around the globe were grappling with what new tools were needed in the era of digital giants.

The Australian Competition and Consumer Commission released its landmark report into digital platforms last year and has established a special unit to police this part of the economy.

Ms de Silva said the traditional definition of market dominance – share greater than 50 per cent – might not hold true in a world where, for example, Amazon can have a smaller share of retail sales in a particular country but still have a great deal of power.

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The Autorité is also considering whether the definitions of “essential facilities” needs to be expanded beyond traditional areas such as ports and telecommunication networks to digital platforms.

It has also experimented with the use of interim orders against a company, to stop behaviour while an investigation is on-going.

Ms de Silva, who is in Melbourne for a meeting of the International Competition Network hosted by the ACCC, said co-ordinated action around digital competition issues is crucial.

“For me, it is really important to try and reach a global view on these matters because I think that one of the anxieties of the public is that we are not going to be able to tackle those giants because they’re so much bigger than states, or they seem to be more powerful than the governments. And I don’t think that is true… the more co-ordinated we are, the more effective we will be.”

A key subject for debate at the ICN meeting is likely to be how to scrutinise smaller acquisitions by technology giants which fall below current thresholds for examination by competition regulators, but which can have a detrimental impact on specific markets.

Ms de Silva said while it would be best for tech companies to seek approval for such mergers, an alternative is to allow competition regulators a year or two to retrospectively assess them.



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