Digital economy needs separate competition law, says PCC

The government’s competition watchdog wants a separate law to address emerging challenges in the digital realm, particularly in areas such as advertising and other virtual transactions.

In the Philippine Competition Commission’s (PCC) 34-page report entitled “Digital Platforms and Online Advertising: A Guide for Competition Policy,” it suggested the measure as one of three solutions for the country to keep up with ever-changing technologies.

“There is a need to rethink the possibility of enacting a separate law to tackle competition cases in the digital economy,” read a part of the report penned by PCC policy research officer Jestoni Olivo.

“This signals that the country is one with other jurisdictions in stripping away global dominant players’ market power,” it added.

The report took note of a case study on technology giant Google and its $3.1-billion acquisition of online advertising firm DoubleClick in December 2007, leading to the former becoming an advertising powerhouse.

“Google’s ad business is now a focus of wide-ranging investigations by the (United States’ Department of Justice). The studies aim to uncover whether the company choked off competitors and shortchanged advertisers and publishers to build an ad empire,” the report read.

Double Click was estimated to have had a 40-percent market share at most before the acquisition, cited the report.

PCC also highlighted a 2017 European Commission decision saying the results of product searches made using the tech giant’s search engine platform positioned and displayed more favorably those from its comparison-shopping service.

The PCC report said digital transactions transcended geographic boundaries and that digitalization integrated all operations in an industry’s value chain, necessitating the need for the government to establish a regulatory framework that facilitated digital trade and safeguards the competitive process.

Aside from the law, the report also suggested building relationships with more advanced jurisdictions to address cross-border competition issues.

The report also recommended strengthening the implementation of the Philippine Competition Act by developing a comprehensive guideline for investigating competition cases in the digital economy. —Alden M. Monzon