The innovations brought by digitalisation have generated substantial consumer benefits in many markets, such as lower prices, greater accessibility and convenience, more variety and new products, but also concerns, in terms of different market structures, anticompetitive conduct and mergers giving rise to durable market power. While many core principles of competition law remain relevant to the new digital realities, competition authorities need to adapt their analytical tools to the uniqueness of digital markets which may require legislative changes and adapted processes, to match the speed of evolution in digital markets and ensure that potentially anticompetitive conduct is scrutinised.

The OECD Handbook on Competition Policy in the Digital Age highlights the key messages and resources from the extensive body of OECD work in this area on over 40 topics. It also contains OECD views on the road ahead for digital competition policy, including the need for co-ordination among jurisdictions as they transition from diagnosing concerns, to implementing solutions.

Specific features of digital mergers, such as the prominent role of platform ecosystems relying on strong network effects, high quality algorithms, economies of scale and data-driven economies of scope, bring into question the ability of traditional theories of harm to reflect the real competitive harm that may result from mergers in these markets. The last few decades have witnessed a significant volume of acquisitions by the largest digital platforms, with markedly few resulting in any intervention by competition authorities. These acquisitions have contributed to the rise and expansion of large digital ecosystems through which platforms have extended their reach and influence into markets far beyond their core services. In 2023 the OECD Competition Committee explored the development of theories of harm for potentially anticompetitive mergers with a discussion on the topic.

Companies increasingly use algorithms to set prices and create or enhance new products and services. While algorithms can result in many efficiency-enhancing and pro-competitive effects, they can also be used by firms to restrict competition. Competition authorities should be aware of these risks, know how to investigate them, and addressing any possible harm to consumers.

Competition authorities are increasingly faced with cases that involve algorithms, and this trend is likely to only increase in the future. Many authorities are investing in the knowledge and skills to understand how they work and to identify harm. While still an emerging academic field, there have been considerable advances in methods related to algorithmic auditing and explainable AI.