Abstract
Personalized pricing can have negative or positive effects for consumers. Concerns are more likely to arise in circumstances where there is limited competition, or where consumers are unaware of, do not understand, and/or cannot avoid personalization. In some circumstances, personalization may be unfair or otherwise illegal under the Consumer Protection from Unfair Trading Regulations 2008 or other legislation. It may also distort competition and give rise to consumer harm and thereby infringe UK or EU competition law, or cause markets to not work effectively and therefore justify a market study or investigation by the Competition and Markets Authority (‘CMA’) under the Enterprise Act 2002. This article considers how the CMA will tackle personalized pricing that may distort competition in digital markets.
Highlights
Personalized pricing can have negative or positive effects for consumers
Concerns are more likely to arise in circumstances where there is limited competition, or where consumers are unaware of, do not understand, and/or cannot avoid personalization
Online markets increase the scope for personalization and, unlike markets offline, allow for traders to collect information about a consumer’s search behaviour without the consumer being able to see the pricing offers made to other consumers
Summary
Concerns are more likely to arise in circumstances where there is limited competition, or where consumers are unaware of, do not understand, and/or cannot avoid personalization. Competition Law Journal, 2019, Vol 18, No 1 an evidence-based assessment of the market and consider carefully the best form (if any) of intervention in a case at hand. This includes recognizing the risks of both inaction and significant interventions. The CMA, and previously the Office of Fair Trading (‘OFT’), has published guidance for businesses, including recommendations from its previous studies into digital markets to help online traders comply with consumer and competition law and to support effective growth of digital markets
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