Big Data and Regulation (selected literature)
Autorité de la concurrence and Bundeskartellamt (2019)
Algorithms and Competition
Algorithms are among the most important technological drivers of the ongoing digitalization process. They are becoming more and more important, enabling firms to be more innovative and efficient. However, debate has arisen on whether and to what extent algorithms might also have detrimental effects on the competitive functioning of markets. In their joint conceptual project – Algorithms and Competition – the Autorité de la concurrence and the Bundeskartellamt studied potential competitive risks that might be associated with algorithms. They elaborated on the concept of algorithm as well as on different types and fields of application. In their study, the two authorities focused in particular on pricing algorithms and collusion, but also considered potential interdependencies between algorithms and the market power of the companies using them as well as practical challenges when investigating algorithms. Isabelle de Silva, President of the Autorité de la concurrence: “Algorithms are used constantly in the digital economy, and are at the very core of how some fast growing businesses operate: online travel agencies, e-commerce, online advertising, to name only a few. It is essential that we look into how these algorithms work. We need to determine if there is a risk that algorithms might facilitate or permit behaviours that are contrary to competition law. With this joint study with the Bundeskartellamt we aim at reaching a common view on these matters and at starting a debate with stakeholders.” Andreas Mundt, President of the Bundeskartellamt: “The joint study is another proof of the continuing cooperation between our agencies. As digital markets keep evolving, we expand our expertise on algorithms in an exchange with each other. This is in line with our efforts to devote more resources to the digital economy with the clear-cut aim to enforce competition law also in the era of platform economy and digital business models.” Algorithms and competition are also the topic of an accompanying conference hosted by the Autorité de la concurrence and the Bundeskartellamt that is taking place in Paris today. Several renowned speakers, including business representatives, researchers and competition enforcers, are discussing potential business applications for algorithms, pricing algorithms and the risk of horizontal collusion, as well as ways to address the challenges raised by algorithms.
Foreign countries - selected documents
Finnish Government (2019)
Framework for innovation-friendly regulation
Radical innovations and break-through technologies are desperately needed in solving to-day’s difficult societal challenges, such as those created by climate change or ageing demographics. However, addressing complex societal challenges requires elaborate systemic planning, determined investments and often also, visionary and brave decisions by the legislators and regulators. While radical innovation may bring much needed economic benefits and solutions to pressing societal challenges, they can also generate new risks and ethical dilemmas. Hence, today’s legislators are faced with difficult questions in trying to foresee an optimal legal framework, which would sufficiently leave space for and encourage new solutions, but at the same time would ensure safe conditions and fair benefits to everyone. In light of the above, increased attention is paid to developing innovation-friendly regulatory approaches and practices. The introduction of European Commission’s Innovation Principle, as well as several national initiatives (such as regulatory sandboxes and regulation roadmaps), are good examples of such development. So far, there has not been a common definition, nor a comprehensive framework to grasp the different aspects of innovation-friendly regulation approaches and practices. Developing such framework has been one of the main objectives in Finnish government commissioned study on “Impacts of regulation on innovation and new markets”. This Policy Brief presents some first findings and introduces a draft framework for innovation-friendly regulation.
Big Data and Regulation (selected literature)
NESTA (2019)
Decision-making in the Age of the Algorithm
Frontline practitioners in the public sector – from social workers to police to custody officers – make important decisions every day about people’s lives. Operating in the context of a sector grappling with how to manage rising demand, coupled with diminishing resources, frontline practitioners are being asked to make very important decisions quickly and with limited information. To do this, public sector organisations are turning to new technologies to support decision-making, in particular, predictive analytics tools, which use machine learning algorithms to discover patterns in data and make predictions. While many guides exist around ethical AI design, there is little guidance on how to support a productive human-machine interaction in relation to AI. This report aims to fill this gap by focusing on the issue of human-machine interaction. How people are working with tools is significant because, simply put, for predictive analytics tools to be effective, frontline practitioners need to use them well. It encourages public sector organisations to think about how people feel about predictive analytics tools – what they’re fearful of, what they’re excited about, what they don’t understand. Based on insights drawn from an extensive literature review, interviews with frontline practitioners, and discussions with experts across a range of fields, the guide also identifies three key principles that play a significant role in supporting a constructive human-machine relationship: context, understanding, and agency.
EU: selected document
European Commission (2019)
Study supporting the interim evaluation of the innovation principle
The European Commission has recognised the importance of a more innovation-oriented EU acquis, gradually exploring the ways in which EU rules can support innovation. The ‘innovation principle’ was introduced to ensure that whenever policy is developed, the impact on innovation is fully assessed. However, as further discussed in this Study, the exact contours of the innovation principle have been shaped very gradually within the context of the EU better regulation agenda: originally advocated by industry in the context of the precautionary principle, the innovation principle has gradually been given a more articulate and consistent role, which aims at complementing the precautionary principle by increasing the salience of impacts on innovation during all phases of the policy cycle. This Study presents an evaluation of the current implementation of the innovation principle, limited to two of its three components, i.e. the Research and Innovation Tool included in the Better Regulation Toolbox, and the innovation deals. As a preliminary caveat, it is important to recall that the implementation of the innovation principle is still in its infancy, and thus the Study only represents a very early assessment of the extent to which the innovation principle is being correctly implemented, and whether changes would be required to make the principle more effective and useful in the context of the EU better regulation agenda. The main finding is that the innovation principle has the potential to contribute to the quality and future-proof nature of EU policy, but that significant changes and effort will be needed for this potential to fully materialise. The most evident areas for improvement are related to the lack of a clear legal basis, the lack of a widely acknowledged definition, the lack of awareness among EU officials and stakeholders, and the lack of adequate skills among those that are called to implement the innovation principle. As a result of these problems, the impact of the innovation principle on the innovation-friendliness of the EU acquis has been limited so far. The Commission should clarify in official documents that the Innovation principle does not entail a de-regulatory approach, and is not incompatible with the precautionary principle: this would also help to have the principle fully recognised and endorsed by all EU institutions, as well as by civil society, often concerned with the possible anti-regulatory narrative around the innovation principle in stakeholder discussions. Apart from clarifications, and further dissemination and training, major improvements are possible in the near future, especially if the innovation principle is brought fully in line with the evolving data-driven nature of digital innovation and provides more guidance to the Commission on how to design experimental regulation, including inter alia so-called ‘regulatory sandboxes’. Finally, the Commission should ensure that the innovation principle is given prominence with the transition to the Horizon Europe programme, in particular due to the anticipated launch of ‘missions’ in key domains.