Call for evidence outcome

Digital Competition Expert Panel

Updated 13 March 2019

1. Introduction from the Panel

The Chancellor of the Exchequer has asked us to conduct an independent review of the state of competition in the digital economy, and consider what the opportunities and challenges are for policy, both in the UK and internationally. The Terms of Reference set the basis for our work.

This is an issue many advanced economies are now choosing to examine carefully. In addition to our own analysis, we hope to draw on lessons from the work of others when thinking about how the UK competition system might itself adapt. We in turn hope our work will help the UK lead the way internationally in developing approaches to an issue central to ensuring that consumers and the economy benefit fully from the tremendous potential of digital technology.

Our work will be grounded in evidence and we intend to engage with a wide range of experts and interested parties, within the short time available. By responding to this Call for Evidence you will contribute to the range of evidence that we will consider. Our work will be helped by receiving the best quality evidence from the widest range of people and organisations.

We will draw on the evidence gathered to prepare our report recommending any changes that may be needed. We intend to present this to the government in early 2019. The report’s recommendations will inform the work of HM Treasury, the Department for Digital, Culture, Media and Sport, and the Department for Business, Energy and Industrial Strategy, particularly the Competition Law Review. We value your contribution to our work and look forward to considering your response.

2. How to respond

The consultation period will run between 12 October 2018 and 7 December 2018. Copies of this document may be found on gov.uk.

Please send responses to any, or all, of the questions below to: dcep@hmtreasury.gov.uk.

Please indicate if you are responding in a personal capacity or on behalf of a company or organisation. You must disclose all financial or other links between you or your organisation, and any company operating in a sector in, or connected with, the scope of our review. This should include a stating whether any research you have ever conducted has received commercial funding from a company of this kind.

If you do not have access to email, you can write to:

Digital Competition Expert Panel Secretariat
HM Treasury
2nd Floor, Orange
1 Horse Guards Road
London SW1A 2HQ

Please ensure that your response reaches us before the closing date.

Respondents are strongly encouraged to keep their submissions to a limit of 5,000 words. Annexes and supplementary information may be provided in addition to this, if required.

The Panel may choose to publish responses in full or in summary form. If you would not like all or part of your response to be published, please explicitly mark it as ‘not for publication’ and it will remain private.

Please note the important information following the questions that sets out how your response will be treated and how any personal data you provided which identifies you or third parties will be handled.

3. Questions

3.1 Understanding the effects of digital markets

1.What are the emerging benefits and harms from digital markets such as social media, e-commerce, search, and online advertising tending towards only one or a small number of big firms?

We would particularly welcome evidence on:

• the extent to which some digital markets appear to tend towards only one or a small number of firms;

• the key drivers of this trend (if present), and whether they relate to inherent features of these markets;

• the benefits or harms which are associated with concentration in digital markets; and

• the degree to which large market players enable or inhibit wider innovation and investment.

We would welcome evidence on the positive or negative economic impacts of all of the above, for example on prices, quality, choice, innovation or privacy. The Expert Panel was asked to focus on the impacts on competition: please do not provide evidence relating to impacts on (for example) harmful content available online, or the impacts of digital markets on the availability of a range of news media which are beyond the scope of our review or being considered elsewhere. Please be explicit about the sources of evidence for your view, where possible.

2.What are the emerging benefits and harms of the same small number of digital firms becoming present across a broad range of digital markets?

We would particularly welcome evidence on:

• the extent to which the same small number of digital firms are becoming present across a broad range of digital markets;

• the key drivers of this cross-market presence

• the benefits or harms associated with cross-market presence.

We would welcome evidence on the economic impacts of the above, along the same lines set out under question one.

3.What effect can the accumulation and concentration of data within a small number of big firms be expected to have on competition?

We are particularly interested in whether data may constitute a ‘barrier to entry or expansion’ for companies seeking to compete in the digital economy. Please provide any evidence for your view.

4.What is the economic impact of the acquisition of smaller firms with relatively small market shares by much larger ones and is this different in the digital space than in other sectors?

Does the potential for acquisition of smaller firms provide an efficient source of capital and exit or does it affect innovation? Does acquisition of smaller firms raise the value of their innovations as they get incorporated into larger platforms or does it forestall potential future competition? Does the tax system or other policy features create biases that lead to more or less acquisitions than would be the case with a neutral policy regime?

5.To what extent is it relevant for any identified benefits and harms that consumers receive ‘free’ services, paid for through their data? How does this affect competition in associated markets, such as the market for online advertising?

Please provide any evidence for your view.

6.How do technologies such as artificial intelligence (AI) and machine learning affect competition and what are their implications for competition policy? Does algorithmic pricing raise new concerns about competition?

We are interested in any evidence on the implications of AI, machine learning and algorithms for competition. In particular we would welcome any evidence on whether prices set algorithmically but without explicit collusion can interact or converge in ways that would disadvantage consumers.

3.2 Policy and implementation solutions

7.What tools does competition policy need to deal with issues in the digital economy in a sufficiently timely, effective and far-sighted manner? To what extent are these in place in the UK?

Specifically:

A. What is the appropriate approach to mergers and takeovers in digital markets – what are the key challenges and how should they be addressed?

B. What is the appropriate approach to antitrust enforcement (cartels, vertical restraints and abuse of dominance) in digital markets – what are the key challenges and how should they be addressed? We would welcome specific proposals for changes to institutions, policy or its implementation under any of these headings. Please provide any evidence for your views demonstrating how changes would benefit consumers and the economy in response to these questions.

8. Are there other policy changes beyond traditional competition tools that could facilitate entry and thus improve competition and economic outcomes?

For example, you may wish to consider options for sector-led initiatives or regulation to make data more open, portable or interoperable between different platforms, or standardised in format if these would enable more effective competition in digital markets?

Again, in relation to policy changes beyond traditional competition tools, we would welcome specific proposals for changes to institutions, policy or its implementation. Please provide any evidence for your views demonstrating how changes would benefit consumers and the economy in response to these questions.

9. What approaches are being considered and developed by governments and competition authorities in other major economies? What needs to be done internationally and what can be done at the UK level?

We are interested in positive experiences of other jurisdictions in policy making in the digital economy and would welcome evidence on this. We are also interested in understanding what policy changes would be appropriate within the UK and what would need to be made at an international level. We are also interested in what policies would require or benefit from international coordination.

Please provide any evidence for your view.

10. Are there other issues you consider that the review should be considering, given its focus on competition in the digital economy?

4. Digital Competition Expert Panel call for evidence on competition in the digital economy - Processing of Personal Data

This notice sets out how the Digital Competition Expert Panel and HM Treasury (who are the joint data controllers) will use your personal data for the purposes of this consultation on competition in the digital economy and explains your rights under the General Data Protection Regulation (GDPR) and the Data Protection Act 2018 (DPA).

Your data (Data Subject Categories)

The personal information relates to members of the public, parliamentarians, and representatives of organisations or companies.

The data that the joint controllers collect (Data Categories)

Information may include the name, address, email address, job title, and employer of the correspondent, as well as their opinions. It is possible that respondents will volunteer additional identifying information about themselves or third parties.

Legal basis of processing

The processing is necessary for the performance of a task carried out in the public interest. The task is requesting evidence or obtaining opinion data in order to develop good effective proposals and recommendations to government.

The Digital Competition Expert Panel or HM Treasury may use the contact details provided to contact respondents during the consultation period in order to request clarification or further information regarding the response provided where this is deemed necessary.

Special category data

Although not being requested, it is possible that special category data may be processed if it is volunteered by the respondent.

Legal basis for processing special category data

Where special category data is volunteered by you (the data subject), the legal basis relied upon for processing it is: the processing is necessary for reasons of substantial public interest for the exercise of a function of the Crown, a Minister of the Crown, or a government department.

This function is consulting on departmental policies or proposals, or obtaining opinion data, to develop good effective policies.

Purpose

Any personal information will be processed for the purpose of obtaining evidence from members of the public and representatives of organisations and companies, about; departmental policies, proposals, or generally to obtain public opinion data on an issue of public interest.

Information and data provided to the joint controllers in response to this call for evidence will be used by the Digital Competition Expert Panel to support their considerations on “the potential opportunities and challenges the emerging digital economy may pose for competition and pro-competition policy, and make recommendations to government on any changes that may be needed”.

Here is the membership and terms of reference for the Panel.

Who the joint controllers share your responses with (Recipients)

Information provided to the joint controllers in response to consultations may be published or disclosed in accordance with the access to information regimes. These are primarily the Freedom of Information Act 2000 (FOIA), the Data Protection Act 2018 (DPA) and the Environmental Information Regulations 2004 (EIR).

In view of this it would be helpful if you could explain why you regard the information you have provided as confidential. If the joint controllers receive a request for disclosure of the information they will take full account of your explanation, but they cannot give an assurance that confidentiality can be maintained in all circumstances. An automatic confidentiality disclaimer generated by your IT system will not, of itself, be regarded as binding on the Digital Competition Expert Panel or HM Treasury.

The Digital Competition Expert Panel’s work will be independent of government. It will make a final report with its recommendations to the Chancellor of the Exchequer and the Secretary of State for Business, Energy and Industrial Strategy in early 2019. Its recommendations will inform the work of HM Treasury, the Department for Digital, Culture, Media and Sport, and the Department for Business, Energy and Industrial Strategy, particularly the Competition Law Review.

Where someone submits special category personal data or personal data about third parties, the joint controllers will endeavour to delete that data before publication takes place.

Where information about respondents is not published, it may be shared with officials within public bodies involved in this consultation process to assist them in developing the policies to which it relates. Examples of these public bodies appear on gov.uk.

As the personal information is stored on HM Treasury’s IT infrastructure, it will be accessible to HM Treasury’s IT contractor, NTT. NTT will only process this data for the joint controllers’ purposes and in fulfilment with the contractual obligations they have with HM Treasury.

How long we will hold your data (Retention)

Personal information in responses to consultations will generally be published and therefore retained indefinitely as a historic record under the Public Records Act 1958.

Personal information in responses that is not published will be retained for three calendar years after the consultation has concluded.

Your rights

You have the right to request information about how your personal data are processed and to request a copy of that personal data.

You have the right to request that any inaccuracies in your personal data are rectified without delay.

You have the right to request that your personal data are erased if there is no longer a justification for them to be processed.

You have the right, in certain circumstances (for example, where accuracy is contested), to request that the processing of your personal data is restricted.

You have the right to object to the processing of your personal data where it is processed for direct marketing purposes.

You have the right to data portability, which allows your data to be copied or transferred from one IT environment to another.

How to submit a Data Subject Access Request (DSAR)

To request access to personal data that the joint controllers hold about you, contact:

HM Treasury Data Protection Unit
G11 Orange
1 Horse Guards Road
London
SW1A 2HQ

dsar@hmtreasury.gov.uk

HM Treasury provides a secretariat function to the Digital Competition Expert Panel.

Complaints

If you have any concerns about the use of your personal data, please contact HM Treasury via this mailbox: privacy@hmtreasury.gov.uk.

If HM Treasury is unable to address your concerns to your satisfaction, you can make a complaint to the Information Commissioner, the UK’s independent regulator for data protection. The Information Commissioner can be contacted at:

Information Commissioner's Office
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF
0303 123 1113

casework@ico.org.uk

Any complaint to the Information Commissioner is without prejudice to your right to seek redress through the courts.

Contact details

The joint controllers for any personal data collected as part of this consultation are the Digital Competition Expert Panel and HM Treasury, the contact details for which are:

HM Treasury
1 Horse Guards Road
London
SW1A 2HQ
London
020 7270 5000

public.enquiries@hmtreasury.gov.uk

The contact details for HM Treasury’s Data Protection Officer (DPO) are:

The Data Protection Officer
Corporate Governance and Risk Assurance Team
Area 2/15
1 Horse Guards Road
London
SW1A 2HQ
London

privacy@hmtreasury.gov.uk