As artificial intelligence (AI) advances, there are not only opportunities for innovation, but also risks. Different Lithuanian institutions monitor the development of AI and assess how it can change the application of rules. Competition institutions are one of them. If an anticompetitive result is created by AI, can its use help the company defend itself against accusations of competition law violations? The answer to this question would depend on several conditions. One of them is whether the company operated independently or not, he says Simona Liuimienė, managing lawyer of law firm COBALT.
The competition rules state that agreements between companies that restrict competition are illegal. True, S. Liuimienė admits that today’s lawyers face the problem that it is difficult to prove such anti-competitive agreements between companies.
“Nowadays it is not necessary to meet and clearly agree on the coordination of certain actions. Just by observing a competitor’s actions in the electronic space, it may be possible to predict what strategy or pricing he applies,” says the leading lawyer.
Nevertheless, S. Liuimienė emphasizes that although it is becoming more and more difficult to prove anti-competitive activities in the electronic space, in principle, DI has not changed the general conditions of application of liability for competition rules. So, even as technology advances, the universality of competition rules makes it possible to ensure that actions that restrict competition and harm consumers are stopped, she says.
The lawyer mentions a public case more than a decade ago, when Eturas, the administrator of the travel search and booking system “E-turas”, together with other 30 travel agencies, coordinated with each other the size of the discount given to users for trips sold online. According to this mutual agreement between the companies, consumers could receive a maximum of 3 percent when buying online. travel discount. The discount limit in this case was determined using the “E-tour” system.
With this agreement, travel agencies avoided the need to compete by offering discounts, but consumers lost the opportunity to take advantage of competition. It is also important to note that at that time “E-turas” was the first electronic travel purchase platform in Lithuania.
Eturas UAB“ and other travel agencies violated the Competition Act, which prohibits agreements restricting competition, and received then a solid 5 million. litas fine, says the lawyer.
According to experts, these were the first “berries” of artificial intelligence, and such cases and challenges due to the development of artificial intelligence are increasing with time.
What is the liability?
COBALT’s chief legal officer says that it is first and foremost important to understand that AI is an algorithm or program that a person develops and trains to achieve certain results. Currently, AI cannot and is not capable of operating fully autonomously, regardless of settings. This means that the responsibility for legal violations committed by AI rests with its user. Therefore, if the company uses AI for its own purposes, for example, to determine the price under market conditions, the full responsibility for the proper use of AI rests with the company.
In terms of competition law infringements, it should be noted that liability should not apply for the fact that a company has used AI to monitor the public prices of its competitors and set its own pricing accordingly. If different AI algorithms, acting autonomously, determine the same prices, such actions are not prohibited.
“Violations of competition law occur when companies do not act independently. As in the aforementioned Eturo case. For example, if different companies agree to determine the price of a product using the same algorithm, or jointly create a separate AI algorithm, such agreements would be illegal,” – she emphasizes.
A company may also be held liable if it uses artificial intelligence algorithms to set unfairly high prices for consumers or discriminatory prices for its customers by taking advantage of its dominant position. Such actions may constitute abuse of a dominant position by a company, which is prohibited.
The message was published by: Aistė Audickaitė, Communications agency “23:45 agency”
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