Francesco Alongi

This chapter addresses the role played by competition law in defining the characteristics, as well as the limits, of digital sovereignty. Digital services and so-called online platforms (search engines, online marketplaces, social networks, etc.) have brought benefits to users and consumers, reshaping distribution systems and value chains, disrupting existing markets and creating new ones. The world economy increasingly relies on digital ecosystems and marketplaces and on the collection and processing of user data. However, the vertical integration and conglomerate growth of digital companies, the growing importance of user data and the fast pace of technological development have brought into question the ability of state actors to effectively regulate digital markets. Competition law represents a crucial tool to assert digital sovereignty, and this chapter examines some of the challenges posed by the application of competition rules to the digital world, such as: the difficulty of defining markets and of measuring the market power arising from the availability of large amounts of user data, the potential impact of data-driven pricing algorithms and of digital ledger technologies, and the application of merger control rules to undertakings active in digital markets. A comparative assessment of the regulation and enforcement practice in the People’s Republic of China and in the European Union yields useful insights into the role of competition law as a tool for asserting digital sovereignty and sheds light on the defining characteristics of the Chinese regulatory approach.