The Artificial Intelligence and Competition Law - Challenges for Bosnia and Herzegovina

Abstract

The digital economy is characterized by new business models based on the use of electronic communications and digital technology for the production and distribution of goods and services. Big data is becoming an invaluable resource in the functioning of the digital economy. In order to survive in the market and be more competitive, firms are changing the way they make their strategic decisions and are increasingly resorting to the use of big data and technologically advanced tools, such as pricing algorithms. Companies increasingly use computer algorithms to improve their pricing models, adjust services and predict market trends, which is recognized as a model to increase efficiency. The use of algorithms in everyday business brings benefits to businesses, consumers and, ultimately, society as a whole, but it also raises a number of legal issues. Many questions also arise in competition law, which aims to protect the competition process in the market by banning certain business practices. Use of algorithms can be new sophisticated method, which will make easier for companies to reach and maintain collusion without any formal agreement or human interaction. The use of algorithms contrary to the provisions of competition law, raises the question of whether competition authorities need to improve existing tools for detecting prohibited agreements as well as a number of other issues. Bosnia and Herzegovina is a country in transition with a small open economy, which has the status of a potential candidate for EU membership. Modern competition law in Bosnia and Herzegovina is the result of foreign pressure and meeting the conditions for membership in the European Union. Lawmakers in Bosnia and Herzegovina face the challenge of harmonizing competition law with the acquis and improving methods and tools that would enable the Council of Competition, as a body to protect competition in BiH, to respond to the use of algorithms for illicit business practices. The paper aims to investigate whether and to what extent business processes in Bosnia and Herzegovina have been digitized, i.e. whether business entities use algorithms and to what extent, and whether and to what extent the BiH Council of Competition is ready for challenges of competition law in digital economy.

Key words:  Competition law, algorithmic cartels, digitalisation, Council of Competition