The Competition Commission has launched its Online Intermediation Platforms Market Inquiry that covers online markets that facilitate transactions between businesses and consumers for the sale of goods, services and software to understand online markets in South Africa.
Online intermediation platforms include e-commerce market places, online classified market places, software application stores and intermediated services such as accommodation, travel, transport and food delivery.
"The inquiry is a proactive measure for the Competition Commission to get a greater understanding of the online markets operating in South Africa and whether there are factors that may be hindering competition or undermining the public interest. This will ensure that these markets remain contestable and competitive, which is in the long-term best interests of South African consumers and businesses that depend on them," the commission says.
Online markets have become an increasingly important channel for businesses to reach consumers, a trend which has accelerated under the Covid-19 pandemic and which is likely to continue.
The shift to online commerce also means that it is increasingly important for South African businesses to participate actively in these markets if they are to be part of the global and national economy.
Global experience is that a few platforms may start to dominate online commerce given the features of online markets and, in some cases, the conduct of the markets themselves. In those circumstances, businesses using the markets may be exploited or discriminated against and consumers may not be presented with optimal choices.
The inquiry is broadly focused on three areas of competition and public interest, namely market features that may hinder competition among the online markets themselves, market features that may give rise to discriminatory or exploitative treatment of business users and market features that may negatively impact on the participation of small and medium-sized enterprises and firms owned and controlled by historically disadvantaged persons.
Online markets provide consumers with the convenience of comparing a range of options and then safely buying goods or services online.
For businesses, the online markets offer a ready-made infrastructure to sell online and a means to reach an enormous number of consumers nationally and internationally.