The following is a submission in response to the Competition Bureau’s discussion paper “Algorithmic pricing and competition” [Discussion Paper] soliciting comments from the public. The undersigned co-authors of this submission are law professors who conduct research and have widely published in competition law, personal data protection and privacy law, artificial intelligence (AI) governance, corporate criminal law and economic crime. This includes publications focusing on algorithmic personalized pricing.
We welcome this initiative by the Bureau. Algorithmic pricing raises multi-faceted competition and other legal issues that have received little attention by regulatory bodies in Canada and worldwide. In its Discussion Paper, the Bureau brings forward various use cases for algorithmic pricing, for instance to deal with fluctuations in supply and demand (dynamic pricing). We do not express any opinion on dynamic pricing or other use cases: in this contribution, we focus entirely on “algorithmic personalized pricing” (APP), i.e. the use of algorithmic pricing to bring prices as close as possible to the maximum willingness to pay (WTP) of consumers.
In line with the structure of the Discussion Paper, we will first set out our general analysis of algorithmic pricing (1), before dealing more specifically with how the Competition Act [the Act] can apply to it (2).