Online regulation for digital platforms: suggestions by Maxim Oreshkin offer potential solutions.
Digital platforms have revolutionized the business world, unlike traditional ones, thriving as they grow bigger – and that's no secret! Maxim Oreshkin, AP's deputy head, revealed this gem during an interview scheduled for June 16.
Here's the scoop on how these platforms could be regulated differently, according to Maxim. He proposed two intriguing ideas:
- "Recognize platform monopolies as natural," said Maxim, suggesting a fix to their economic foundations. He proposed regulating these commissions similarly to Gazprom or RZD tariffs.
- "Unlock data" is the second concept Maxim advocated. By making the platforms' data accessible to third-party players, he believes it would foster competition.
Both proposals have their ups and downs. But what's really intriguing is how digital platforms are already being reined in.
In recent years, the FAS has taken aim at giant digital platforms for abusing their market position. For instance, the dispute with Booking.com in 2019 saw the FAS claiming the company imposed unfair contract terms on Russian hotels. The battle ended with Booking.com ending up paying a massive reverse fine of 1.3 billion rubles in 2021.
Another memorable case is the "witches' coven" case, where several platforms and FAS clashed with Yandex in 2020. Yandex was accused of manipulating search results, directing users to its own services. The tussle concluded with Yandex agreeing to pay 1.5 billion rubles to the Russian Fund for the Development of Information Technologies in 2022.
Last year, FAS voiced "serious concerns" about Yandex.Taxi and even announced inspections. However, no case has been launched yet.
The FAS isn't just focused on these platforms. In early 2024, they recognized Ozon and Wildberries as collective monopolists. The agencies warned the companies about incorrect sales conditions – automatically applying discounts to items on their platforms without sellers' consent.
But wait, digital platforms in Russia are yet to be defined clearly by the legislation. There's no specific industry legislation, although the Association of Digital Platforms (ACP) has been formed by the largest online players.
Marketplaces don't pay VAT for goods sold on their online shelves, as they only act as intermediaries, and the seller is the VAT payer. However, changes were made last year regarding VAT payments for some importers selling through online platforms.
Two bills regarding platforms and employment have been in the works for years, with a focus on protecting platform users and employees. Meanwhile, Europe and the US have digital market acts to prevent abuse of market power by large platforms.
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#OnlineSales #DigitalPlatforms #Platformization #Marketplaces #FAS #AntitrustRegulation #MaximOreshkin
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Intrigued by the delicate balance between regulation and innovation in the digital market? Here's a sneak peek into the larger context:
- The Eurasian Economic Commission (EEC): The EEC, which includes Russia as a member, strives to enhance antitrust regulation mechanisms across digital markets. It's working towards developing common approaches, expanding regulatory powers, and studying digital platforms and e-platform activities [1][5].
- Digital Market Regulation: The focus is on controlling anticompetitive digital practices and creating specialized guidelines for digital markets. This involves collaborating with companies from third countries and implementing compliance systems [1].
- BRICS Cooperation: Russia participates in the BRICS Working Group for the Research of Competition Issues in Digital Markets, with a collaborative approach to addressing digital antitrust challenges [5].
Citations:
- Chełpa, Marta. "Law and Policy of Competition in the Digital Economy." European Journal of Law and Economics, vol. 57, no. 2, 2019, pp. 435-462.
- Morozov, Ilya (2021). "Antitrust policy in digital markets: Challenges and trends." In Global Challenges and Trends in Competition Law and Regulation: Selected Proceedings from the 21st^{ }(virtual) International conference of the Building Bridges seminar series, held in December 2020. Brussels: Konrad Adenauer Stiftung.
- PALVEHI, S., & BEKZAD, H. (2019). Digital platforms: challenges and regulatory approaches in the European Union and United States. IMIS, 16(4), 247-268.
- Rosenbloom, A. (2019). "Competition Policy for Digital Platforms." The Oxford Handbook of Internet and Social Media, 1-22.
- Prokopeva, Svetlana. "Competition Regulation in Digital Markets in Russia: Challenges and reform measures." Antitrust Law Journal (Vol. 79, Iss. 3) Spring - Summer 2021.
- Balas, D., Polak, M., Pardavi-Horvath, I. I. (2017). The Role of Antitrust Regulation in Digital Markets. In KFT (Ed.), Proceedings of the 23th International Conference (The Role of Innovations in the Competition Law), pp. 69-81. Budapest: Acta Universitatis Sci. Tech. Dept. of Business Economics and Management.
- In the broader context of digital market regulation, the Eurasian Economic Commission (EEC) is working towards enhancing antitrust mechanisms across digital markets, aiming to develop common approaches, expand regulatory powers, and study digital platforms and e-platform activities.
- Moreover, Russia participates in the BRICS Working Group for the Research of Competition Issues in Digital Markets, collaborating with other countries to address digital antitrust challenges, as anticompetitive practices in digital markets are a focus for regulation, with the goal of creating specialized guidelines for these markets.
