On October 30, 2020, RIA made a submission to the Competition Commission of South Africa in response to a call for comments on the digital economy. RIA’s submission engaged with the digital economy comprehensively as it relates to the following issues:
- Digital Economy and Competition Policy
- Digital Platforms
- Competition Law in Digital Markets
- Regulatory Issues in the Digital Economy
- Broader Economic Challenges
Read an excerpt from RIA’s submission on the broader economic challenges related to the digital economy and download the complete submission below.
Broader Economic Challenges
The accelerated digital transition has sector-wide disruptions that challenge existing competition policy frameworks, not only in terms of telecommunications policy—digitalisation also leads to challenging interplays between privacy, data protection, tax, innovation, sustainability, and competition policies, to name a few. The rules of engagement and enforcement in the digital economy are different from traditional competition policy and regulation and require a transversal dynamic framework guided by multi-stakeholder considerations.
Due to the evolving nature of the digital economy and its economy wide disruption, an appropriate digital competition policy and regulatory framework will need to be comprehensive i.e., across a sector and potentially also include regulation that impacts ancillary digital economy goods and services in sectors such as energy and electricity, transportation and logistics, and electronic waste recycling, among others. Furthermore, to navigate the fast-paced emergence and development of innovative technologies and business models, the Competition Commission of South Africa (CCSA) will also need to adopt an experimental, adaptive and innovative strategy that facilitates market-testing. This approach will enable authorities to simultaneously maintain the ongoing review of regulations that can be quickly adjusted should new risks arise.
Furthermore, the digital transformation is changing the world faster than many rules and regulations have evolved, reviewing existing competition regulations in the digital era should be a high priority. In addition, due to the unpredictability of the future, a flexible progressive transversal approach may be particularly appropriate during such reviews.
Beyond policy instruments which resemble previous industrial policy, the digital economy requires adapting well-established approaches to industrial policies that shape competition, including domestic licencing rules, localisation rules and partnership requirements with the creation of a unique set of policy tools regarding data blocking, data localisation, data protection frameworks, source code and algorithmic transparency, which could play a key role in allowing economies to keep up with the frontier productivity levels and harness the full potential of digital technologies for stronger growth that benefits all (UNCTAD, 2018).