The National Economic Prosecutor’s Office (FNE), Chile’s competition authority, has announced (29 November) a comprehensive market study to evaluate the competitive dynamics of e-commerce in the country.
This initiative will examine the sale of durable goods to end consumers and the roles of key stakeholders, including advertisers, suppliers, logistics providers, and digital marketplaces.
The study, prompted by the rapid growth of e-commerce, aims to identify potential market failures or practices that may hinder competition. With annual e-commerce sales projected to surpass USD 11.5 billion in 2024—equivalent to 3.7% of Chile’s GDP and 15% of retail sales—the sector has become a vital driver of the economy.
Key Objectives
The FNE’s primary goal is to ensure competitive fairness within e-commerce, benefiting businesses, consumers, and the broader economy. National Economic Prosecutor Jorge Grunberg emphasized the importance of maintaining a competitive digital marketplace, noting that e-commerce fosters innovation and provides opportunities for entrepreneurs.
If the study identifies anticompetitive practices, the FNE may propose regulatory amendments or issue guidelines to economic agents.
Potential Risks to Competition
Drawing on international examples, the FNE highlighted risks that could harm competition, including:
- Most-favored-nation and price parity clauses: These can entrench dominant platforms, deterring new entrants.
- Self-preferencing: Platforms prioritizing their own products to the detriment of others.
- Costly contractual obligations: High fees or bundled service requirements imposed on sellers.
- AI and algorithm use: While enabling efficiencies, these tools can facilitate collusion or discriminatory pricing.
Such practices, if left unchecked, could consolidate market power, reduce consumer choices, and create barriers for emerging players.
Proactive Approach
The FNE advocates a precautionary stance, especially given the network effects and data processing capabilities that enable digital marketplaces to quickly dominate markets. The organization aligns with OECD recommendations emphasizing market studies as crucial for addressing competition challenges in digital sectors.
Bridging Information Gaps
A significant motivation for the study is the lack of reliable data on Chile’s e-commerce sector, which impedes an in-depth understanding of its competitive landscape. By addressing this gap, the FNE aims to develop actionable insights for policymakers and stakeholders.
FNE’s Track Record
This e-commerce analysis marks the FNE’s tenth market study, following investigations into sectors such as pharmaceuticals, gas, and higher education. The effort underscores the authority’s commitment to fostering transparent and competitive markets.
With this initiative, Chile aims to position its e-commerce sector as a robust and fair marketplace for all participants.
Source: https://www.fne.gob.cl/en/fne-inicia-estudio-de-mercado-sobre-comercio-electronico/
