AI may enable collusion; regulators need a forward-looking approach: CCI

Artificial intelligence is a driving force in modern markets that also has the potential to enable collusion, including algorithmic discrimination under the garb of dynamic pricing, CCI chief Ravneet Kaur said on Sunday.

She also emphasised the need to adopt a forward-looking approach as well as trust-based regulations.

Delivering the special address at the 10th National Conference on Economics of Competition Law in the national capital, Kaur said Artificial Intelligence (AI) is a driving force in modern markets.

AI shapes pricing strategies, decision-making, and operational efficiencies across industries but also presents risks, she noted.

According to the Competition Commission of India (CCI) Chairperson, AI can enable new forms of collusion such as "cartels without human communication, price coordination without explicit agreements, and algorithmic discrimination under the garb of dynamic pricing".

The fair trade regulator is already conducting a study on AI and competition.

While mentioning that traditional enforcement models, built on adversarial approaches, are no longer sufficient in addressing evolving market complexities, Kaur said the future demands a more collaborative regulatory strategy.

"Today's competitive landscape is defined by platform economies, network effects, and algorithm-driven decision-making," the CCI chief said and added that market power today is about data control, network effects, and platform reach.

The goal is to balance innovation with competition, ensuring fair and open markets, she noted.

At the conference, organised by the CCI, Union Minister of State for Corporate Affairs Harsh Malhotra pitched for real time monitoring of markets to ensure fair competition.

Since the enforcement of the Competition Act, 2002, CCI has received over 1,300 antitrust cases and out of them, 1,180 cases have been disposed of.

Last year, the regulator received 42 antitrust cases and prima facie violations were found in 8 cases, leading to detailed investigations.

As many as 19 cases were closed at the prima facie stage due to no violation, and 15 cases are pending at various stages of inquiry.

In 2024, the watchdog received 128 combination notices and 126 cases were disposed of, Kaur said, adding that in 2 cases, approvals were granted with remedies to safeguard competition.