CCI Chair Urges Companies to Audit AI Use for Competition Compliance
Boards and management of companies utilizing artificial intelligence tools for business growth are being called to action by the Competition Commission of India (CCI) to conduct thorough audits of their AI deployments. The chairperson of the CCI, Ravneet Kaur, emphasized the necessity of ensuring compliance with fair market conduct rules during her address at a recent event organized by the Confederation of Indian Industry (CII).
The Importance of Self-Audit
In her speech, Kaur highlighted the potential risks associated with AI usage that could lead to unintentional breaches of market conduct regulations. She stressed that company management can play a crucial role in the initial assessment phase of AI adoption.
“Can the boards and management of various industries that are adopting AI for business growth also look at the potential anti-competitive outcomes which may occur knowingly or unknowingly?” Kaur questioned, underlining the importance of self-audit as the first step in the AI implementation process.
Identified Risks of AI Usage
Citing a study conducted by the CCI on the challenges posed by AI from a competition law perspective, Kaur identified seven distinct risks associated with AI usage:
- Algorithmic collusion
- Unilateral conduct
- Price discrimination
- Network effects
- Buying and bundling
- Strategic mergers and acquisitions
Although the Commission has identified these risks, Kaur noted that specific prescriptions for addressing them have yet to be developed.
Balancing Deterrence and Innovation
In her remarks, Kaur reiterated the CCI’s goal of maintaining a balance between strong deterrence against anti-competitive conduct and fostering an innovation-driven market environment. She mentioned the critical role of the Deal Value Threshold (DVT) as a regulatory measure designed to capture high-value digital acquisitions.
Dialogue and Regulatory Clarity
Kaur underscored the significance of ongoing dialogue to understand market realities, ensure regulatory clarity, and promote compliance. The CCI is actively refining its analytical tools and enforcement strategies to adapt to the evolving landscape of AI and competition law.
As companies navigate the complexities of AI adoption, the call for self-audit and compliance with fair competition standards becomes increasingly vital to safeguard market integrity.
