Competition Commission Online Intermediation Platform Market Inquiry Provisional findings

Premise

The Commission has reason to believe that there are market features of online intermediation (the act of coming between) platforms that may impede, distort or restrict competition

Potential Impact

The Online Intermediation Platform Market Inquiry provisional findings and remedies may impact online travel and accommodation platforms, and search engines and could also have an impact on travel and accommodation service providers. Online intermediation platforms facilitate transactions between business users and consumers for the sale of goods, services and software, and the scope includes eCommerce marketplaces, online classifieds and price comparator services, software application stores and intermediated services such as accommodation, travel and food delivery.

Engagement and submission

The Inquiry has extended an invitation for comment on the provisional findings and remedies either in writing or as an alternative, in an in-camera (confidential) meeting. The Inquiry will review all public submissions and engage directly with stakeholders affected by any provisional findings and recommendations. The Inquiry contemplates releasing the final report in November 2022.

Key focus areas

The inquiry is broadly focused on four areas of competition and public interest, namely:

  • the market features that may hinder competition amongst the platforms themselves;
  • the market features that may hinder competition amongst business users or undermine consumer choice;
  • market features that give rise to the exploitative treatment of business users; and
  • market features that may negatively impact the participation of SMEs and/or HDP firms

Main Provisional Findings and Recommendations 

The Inquiry has set out provisional remedial actions and recommendations to address the provisional findings, in line with the legal framework. These remedial actions and recommendations only apply in respect of South African operations for global platforms and domestic platforms. This includes the platform use by South African consumers and the contracts and treatment of business users on the platform (section 121 page 46)

Provisional Leading platforms 

The Inquiry has identified the following as leading platforms in their respective platform categories. In each platform category, leading platforms will be subject to remedial action or the subject of recommendations (Section 124 page 46)

  • Apple App store and Google Play store in software app stores;
  • Takealot in eCommerce;
  • Property24 and Private Property in property classifieds, and Autotrader and Cars.co.za in automotive classifieds;
  • Booking.com & Airbnb in travel & accommodation;
  • Mr Delivery and UberEats in food delivery,
  • Google search in general search (as an input to platform competition)

Provisional platform competition findings and recommendations

The Inquiry makes provisional findings in respect of features which impede, restrict or distort online intermediation platform competition in South Africa, and proposes remedial actions to remedy these. The findings and remedial actions are set out under the following headings – 

Google Search platform

This section will be of interest to businesses paying for preferential search engine positioning with Google or possibly other large search engines.

  • For key findings view sections 127 to 130
  • For proposed remedial actions view sections 131 to 131.6

Online Classifieds platforms

Appears to focus on large property search platforms

  • For key findings view sections 132 to 133
  • For remedial actions view sections 134 to 134.5

Food Delivery platforms

It will be of interest to those groups and or independent restaurants who make use of online food delivery platforms 

  • For key findings see sections 135 to 138
  • For key remedial actions see sections 139 to 139.5

Travel and Accommodation platforms

Will be of interest to accommodation establishments involved with large online booking platforms such as Booking.com & Airbnb. 

  • For key findings view sections 140 to 141
  •  For key remedial actions view sections 142 to 142.2

eCommerce platforms

Deals primarily with intermediation e-commerce platforms and price parity

  • For key findings view sections 143 to 144
  • For key remedial actions view sections 145 to 145.2

Software application stores platforms

As set out in the heading deals with software application stores platforms

  • For key findings view sections 146 to 151
  • For key remedial actions view sections 152 to 152.3

Provisional business user competition findings and recommendations

This section sets out findings in respect of features which impede, restrict or distort business user competition on online intermediation platform competition in South Africa, including the participation of SMEs or HDPs, or where the lack of sufficient platform competition enables the leading platforms to exploit those business users. The findings are set out under the following headings –

  • Cross-cutting findings in all categories – For findings see sections 154 to 155.3
  • Online Classifieds – For findings see sections 156 to 158.1
  • Food delivery – For findings see sections 159 to 161.
  • Travel and accommodation – For findings see sections 162 to 164.4
  • eCommerce – For findings see sections 165 to 168.2.7
  • Software application stores – For findings see sections 169 to 172.3

Provisional findings and recommendations to government 

This section sets out the proposed involvement of government in terms of regulatory oversight of future conduct and competitive distortions from tax differentials

View sections 173 to 178

Provisional HDP platform and business user findings and recommendations

Specifically focuses on historically disadvantaged persons and online intermediation platforms.

View sections 179 to 185

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