CCI Urges Self-Audits Of AI Systems To Prevent Anti-Competitive Practices

In a move to address emerging challenges posed by artificial intelligence in digital markets, the Competition Commission of India has called on enterprises to conduct self-audits of their AI systems to proactively tackle potential competition concerns.

The recommendation forms a key part of the CCI's latest market study titled "Market Study on Artificial Intelligence and Competition," released on Monday.

The study highlights the growing risks of AI-driven unfair business practices such as algorithmic collusion and price discrimination, and urges companies to embrace transparency and accountability in their AI deployment. Enterprises are encouraged to implement measures that reduce information asymmetry and ensure that AI systems operate within the bounds of fair competition.

As AI continues to evolve rapidly, the report underlines the need for regulatory frameworks, both globally and in India, to keep pace. It notes that jurisdictions around the world are increasingly focusing on algorithmic transparency, governance, and accountability.

The CCI study also calls for the strengthening of the watchdog's own technical capabilities and infrastructure, alongside greater engagement with international competition authorities and global regulatory platforms. It further recommends the establishment of a dedicated think tank to provide expert guidance on AI and digital market dynamics, and advocates for inter-regulatory coordination.

To enhance awareness and compliance, the CCI will organise a conference on AI-related regulatory issues in collaboration with key stakeholders. It also plans to conduct advocacy workshops focused on AI and competition compliance.

While acknowledging the pro-competitive potential of AI, the study warns of its possible downsides including concentration in the AI value chain, ecosystem lock-in, exclusive partnerships, and the opaque nature of algorithms. These factors, it says, could distort market dynamics and harm consumers.

According to a perception survey included in the study, 37% of AI startups expressed concern about AI-facilitated collusion, while 32% flagged risks of price discrimination, and 22% highlighted the threat of predatory pricing.

The global AI market is projected to grow from $244.22 billion in 2025 to $1 trillion by 2031. In India, the sector is expected to surge from $7.84 billion in 2025 to $31.94 billion by 2031.

The report concludes that competition law being both sector- and technology-neutral remains a vital tool in curbing AI-driven anti-competitive practices, as regulators worldwide continue to adapt to the fast-evolving digital landscape.

(With inputs from PTI).