Data as the New Currency? Excessive Data Collection and Leveraging as Non-Price Abuses of Dominance in South Africa's Digital Economy

Policy Paper 60

Abstract

The rise of the internet has brought with it significant complexities, even for the economy. Not only do we have physical brick and mortar markets, but we also now have digital markets. Digital markets present a significant challenge to competition law. This is because, for instance, dominant firms can extract significant value from users, not through monetary prices, but via the collection and downstream use of personal data. This notwithstanding, to date, the South African abuse of dominance framework has not yet extended its price-centric and foreclosure-based analytical tools to data as a competitive input, which leaves unresolved the question as to how data-driven harms should be addressed under the existing doctrine. Accordingly, this paper aims at responding to this challenge by considering specifically how excessive data leveraging and excessive data collection as non-price-based abuses of dominance are dealt with under the Competition Act 89 of 1998. Methodologically, the paper analyses the existing framework with respect to abuse of dominance and considers digital relevant proceedings such as market inquiries to determine how data collection and data aggregation have been dealt with by South African competition authorities. More importantly, the paper also draws comparative insights from the Indian and German jurisdictions which serve as a contextual benchmark. As part of its findings, the paper observes that there is currently no need for legislative amendments to accommodate non-price-based harms. Rather, what is needed is an evolution in the interpretive approach. Herein, data is recognised as a non-monetary form of consideration and a strategic competitive input.