10 Di Digi gital eco tal econom nomy y and nd comp competit - - PowerPoint PPT Presentation

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Antimonopoly committee of the Republic of Uzbekistan

Di Digi gital eco tal econom nomy y and nd comp competit tition ion cha challenge llenges s in in the the Re Republi public c of

• f Uz

Uzbe bekist kistan an

BRIEF INFO ABOUT UZBEKISTAN

Are rea: : 448 980 km km2

Territorial division

12 12 + 1 +1 + 1 +1

Population

33 33.2 .2

mil illion ion

Capital Tas ashken kent

Nationalities

130 130

GDP

50.5

bill llion

• n

USD

16 16

religious confessions

Urbanization

~5 ~52%

2

In 1992 In 1996 In 2000 In 2005 In 2012 In 2017 First antimonopoly agency was established as a Division of the Ministry of Finance on Antimonopoly and Price Policy The Division was reorganized into the State Сommittee on Demonopolization and Competition Development under the Ministry of Finance The Antimonopoly Committee was separated from the Ministry of Finance and became an independent as State Committee for Competition The State Committee for Competition was reorganized and received additional authority for reorganizing economically insufficient and unprofitable ventures The State Committee for Competition was reorganized once again by being merged with the State Property Department Committee State Committee for Competition was reorganized and became as The State Committee of the Republic of Uzbekistan for assistance to privatized enterprises and development of competition In 2019 The State Committee of the Republic of Uzbekistan for Promoting Privatized Enterprises and Development

• f

Competition reorganized and divided into 3 independent State bodies: The Antimonopoly Committee, State-Owned Assets Management Agency and the Capital Markets Development Agency

Ant Antim imono

• nopoly

poly com commi mitt ttee e of t

• f the

he Re Republi public c of U

• f Uzb

zbekist kistan an

UIU

THE HE AN ANTIMONO IMONOPOLY POLY COM OMMITTEE ITTEE at at a g a gla lance nce

(Feb-Sep Sep 2019) 19)

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Sta State te sup suppo port rt for for di digi gital tal econ conom

• my in

in Uzb Uzbekist kistan an

One Million Uzbek Coders “Digital Uzbekistan 2030” state program (to be approved Q2 2020) IT park in Tashkent, 6 IT parks throughout the Republic to be built

“Di Digi gital Uzb tal Uzbeki ekistan stan 2030 030” sta state te pr prog

• gra

ram

• 1. Chief Digital

Officer In government bodies

• 2. Innovation

companies, start-up projects support

• 3. Regulatory

sandboxes creation

• 4. Digital gaps
• vercome and

“last mile” development

• 5. Freelance

development

The program envisages a number of state support measures to digital development

Not Notabl ble e di digi gital econ tal economy

• my re

regul gulatio ation n in U in Uzb zbeki ekistan stan

Law on payments and payment systems

19.09.2019

Law on electronic commerce

22.05.2015

President decree «Measures for digital economy development»

03.07.2018

65 existing documents in IT-communication sphere

President decree «Measures for Central bank activity improvement»

09.01.2018

Law on competition (new version under approval in Parliament)

Expected Q2. 2020

Digital (multi-sided) market – the scope of circulation of goods sold by a business entity via the Internet, including digital platforms used to ensure interaction between two or more different, but interdependent suppliers, customers or other users in order to make profit for at least one of the parties Network effect – the increase in the value of goods in the digital market for one group of buyers or users or the change in the value

• f goods for this group of users with a decrease or increase in the number of users in another group, and, as a result, obtaining

economic advantages for seller by collecting and processing user data with the possibility of maintaining its market share even in the absence of any actions on his part aimed at preventing the entry of competitors. Price algorithm - software for monitoring, calculating, setting and controlling prices for goods or for performing actions when participating in tenders, including auction (exchange) ones.

Key ey de defini finitions tions in com in compe petitio tition n la law w on d

• n dig

igital ital ma mark rket ets s

Introduced in 2019, The definitions are in line with world practice but are new to Uzbekistan; Expanded network effect definition with focus on seller’ advantages

Reg egulation ulation of d

• f dig

igit ital al ma mark rkets ets in the in the compe competi tition tion la law w

The Committee has a broad mandate that applies across sectors, including all digital platforms (new version of Competition Law) Digital markets’ regulation is mentioned in key antitrust directions

Dominant position

Excessive and predatory pricing Mergers Prohibition of state actions limiting competition

E-com commer merce ce siz size e in Uz in Uzbe bekista kistan

E-commerce transactions in 2019: around 2 bln. USD (2% of GDP)

2018 TO 2019 GROWTH BY 30%

MARKET POTENTIAL

15 bln. USD by 2015 50 bln. USD by 2050 SHARE OF E-COMMERCE TO RETAIL

20% by 2015 50% by 2050 Internet penetration level: 60% IT development index: 103 place out of 170 countries

Most

• st vi

visit sited ed na nati tional

• nal e-com

comme merce rce pl platfo tforms rms in Uz in Uzbe bekista kistan

Source: Association of e-commerce of Uzbekistan, 2019

Ke Key pay y payme ment nt sy syste stems ms in Uz in Uzbe bekis kistan tan

• Two national players in processing

and payments – Uz Card (са. 80% share) and Humo

• Several payment systems – Payme,

Click, Paynet, etc.

• Uz Card, Paynet – companies with

the dominant position in the market

• Co-badged cards available:

UnionPay, VISA, Mastercard

Two national payment processing systems share the market

Ke Key fore y foreig ign n di digi gital mar tal marke ket t pl player yers s in U in Uzb zbekis ekistan tan

• Yandex rapidly expanding its

presence in Uzbekistan (April 18 – present 27 applications)

• Google share of pre-installed

applications at mobile phones – 70%

March 19: Yandex metro, transport April 19: Yandex games February 19: Yandex taxi

Foreign digital companies presence expanding

3 1 4

Digital marketplaces are

• ften in grey area

(est. 70% of total e-sales) Establishing clear antimonopoly practices (e.g. product borders) in digital markets: we have to cooperate with the others Dealing with companies hosted outside Uzbekistan: consumer rights are not always respected

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Di Digit ital al ma mark rkets ts re regula ulatio tion n ch challe llenges nges in in Uz Uzbe bekistan istan

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State support to digital platforms: accommodating to competition rules required

Some regulation challenges are related to market development challenges

Archaic legislation: data privacy, new concepts, IP rights in digital markets need to be articulated

Di Digi gital tal ma mark rketplaces tplaces in in Uzb Uzbekist kistan an

Much of digital marketplaces difficult to regulate as they are in “grey zone” Privacy dimension is important but we need to establish clear regulations

70 % of e-commerce transactions happen through Instagram and Telegram channels Est 80% of such transactions happen through cash operations although there are deals approvals through electronic form Electronic commerce is an entrepreneurship activity on sales of goods, works and services carried out through information systems (Law on electronic commerce)

Ba Bala lance nce ne needed ded be betw tween een con consum sumer er ri righ ghts ts and nd di digi gital tal ma mark rket t pl playe yers rs se serv rvices ices

Yandex does not have an office but has 30+ services in Uzbekistan; consumer rights could be compromised in case of taxi services

“Google law” as of 01.01.2020 in Uzbekistan Taxi parks Taxi drivers Customers

• No call-center
• Little consequences on

poor services

• In case lost things

difficult to file a complaint

Acc Accom

• mmo

moda dating ting sta state te sup suppo port rt for for di digi gital pla tal platfo tforms rms to to fa fair ir com compe petit tition ion ru rule les

Ensuring competition in payment and processing systems market

Unified republican processing center National interbank processing center

• Unorthodox

task for competition authority: ensure integration between the two competitor systems, ATMs are not connected

• How do we set limits for international payment

system involvement in Uzbekistan market? (Salary payments, local currency transactions in Visa and Master card)

Acc Accom

• mmo

moda dating ting sta state te sup suppo port rt for for di digi gital pla tal platfo tforms rms to to fa fair ir com compe petit tition ion ru rule les

The desire to keep the pace of technological development and have a champion in the digital markets will have to be faced by competition authorities and have competition implications

• We need to challenge their status, make sure

they act in non-discriminatory manner, do not create market entry barriers and do not abuse their position

• We need to think on how these companies can

change institutional environment so we have to think about digital ecosystems

IMEI codes registration Product labeling

Go Goog

• gle

le ca case se und under r con consi sidera deratio tion n

Yandex posted a complaint on breach of competition rules: Pre-installed services of Google on Android

Customers Distribution channels

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We Web: antimon.gov.uz Cont ntacts: acts:

info@antimon.gov.uz

Tel.: .: 71 207 47 00 @antimonuz AntimonUz

Thank you!