Public comment topics and process

To further its consideration of these issues, the agency seeks public comment on the questions listed below, and it welcomes input on other related topics not specifically listed here.

Background on Algorithms, Artificial Intelligence, and Predictive Analytics, and Applications of the Technologies

1. What features distinguish products or services that use algorithms, artificial intelligence, or predictive analytics? In which industries or business sectors are they most prevalent?
2. What factors have facilitated the development or advancement of these technologies? What types of resources were involved (e.g., human capital, financial, other)?
3. Are there factors that have impeded the development of these technologies? Are there factors that could impede further development of these technologies?
4. What are the advantages and disadvantages for consumers and for businesses of utilizing products or services facilitated by algorithms, artificial intelligence, or predictive analytics?
5. From a technical perspective, is it sometimes impossible to ascertain the basis for a result produced by these technologies? If so, what concerns does this raise?
6. What are the advantages and disadvantages of developing technologies for which the basis for the results can or cannot be determined? What criteria should determine when a “black box” system is acceptable, or when a result should be explainable?

Common Principles and Ethics in the Development and Use of Algorithms, Artificial Intelligence, and Predictive Analytics

7. What are the main ethical issues (e.g., susceptibility to bias) associated with these technologies? How are the relevant affected parties (e.g., technologists, the business community, government, consumer groups, etc.) proposing to address these ethical issues? What challenges might arise in addressing them?
8. Are there ethical concerns raised by these technologies that are not also raised by traditional computer programming techniques or by human decision-making? Are the concerns raised by these technologies greater or less than those of traditional computer programming or human decision-making? Why or why not?
9. Is industry self-regulation and government enforcement of existing laws sufficient to address concerns, or are new laws or regulations necessary?
10. Should ethical guidelines and common principles be tailored to the type of technology involved, or should the goal be to develop one overarching set of best practices?

Consumer Protection Issues Related to Algorithms, Artificial Intelligence, and Predictive Analytics

11. What are the main consumer protection issues raised by algorithms, artificial intelligence, and predictive analytics?
12. How well do the FTC’s current enforcement tools, including the FTC Act, the Fair Credit Reporting Act, and the Equal Credit Opportunity Act, address issues raised by these technologies?
13. In recent years, the FTC has held public forums to examine the consumer protection questions raised by artificial intelligence as used in certain contexts (e.g., the 2017 FinTech Forum on artificial intelligence and blockchain and the 2011 Face Facts Forum on facial recognition technology). Since those events, have technological advancements, or the increased prevalence of certain technologies, raised new or increased consumer protection concerns?
14. What roles should explainability, risk management, and human control play in the implementation of these technologies?
15. What choices and notice should consumers have regarding the use of these technologies?
16. What educational role should the FTC play with respect to these technologies? What would be most useful to consumers?

Competition Issues Related to Algorithms, Artificial Intelligence, and Predictive Analytics

17. Does the use of algorithms, artificial intelligence, and predictive analytics currently raise particular antitrust concerns (including, but not limited to, concerns about algorithmic collusion)?
18. What antitrust concerns could arise in the future with respect to these technologies?
19. Is the current antitrust framework for analyzing mergers and conduct sufficient to address any competition issues that are associated with the use of these technologies? If not, why not, and how should the current legal framework be modified?
20. To what degree do any antitrust concerns raised by these technologies depend on the industry or type of use?

Other Policy Questions

21. How are these technologies affecting competition, innovation, and consumer choices in the industries and business sectors in which they are used today? How might they do so in the future?
22. How quickly are these technologies advancing? What are the implications of that pace of technological development from a policy perspective?
23. How can regulators meet legitimate regulatory goals that may be raised in connection with these technologies without unduly hindering competition or innovation?
24. Are there tensions between consumer protection and competition policy with respect to these technologies? If so, what are they, and how should they be addressed?
25. What responsibility does a company utilizing these technologies bear for consumer injury arising from its use of these technologies? Can current laws and regulations address such injuries? Why or why not?

Comments Due: February 15, 2019

The Commission is seeking comments for Hearing #5 On Competition and Consumer Protection in the 21st Century - Nov. 1 at the Georgetown University Law Center in Washington, D.C:

1. Should the U.S. antitrust agencies publish Vertical Merger Guidelines? What guidance should they provide regarding the assessment of the competitive effects of vertical mergers, including the substantive theories of competitive harm and the treatment of transaction-related efficiencies? Under what conditions, if any, should the guidelines recognize a presumption of anticompetitive harm? What showing should be required to overcome such a presumption? Under what circumstances, if any, should behavioral remedies be accepted to remedy the likely anticompetitive effects of vertical mergers?
2. Is the “consumer welfare standard” the appropriate standard for evaluating compliance with the antitrust laws? What are alternative frameworks with which to evaluate compliance with the antitrust laws? What are their strengths and weaknesses? Is there empirical support for preferring one standard instead of another standard?

This session reschedules the hearing session originally postponed on September 14 due to inclement weather.

Comments Due: December 31, 2018

The Commission is seeking comments for Hearing #3 On Competition and Consumer Protection in the 21st Century held October 15-17, 2018 at Antonin Scalia Law School of George Mason University in Arlington, Virginia, on the following topics:

Multi-Sided Platforms (Oct. 15, 16, and 17):

1. What are the defining characteristics of multi-sided platforms? Is there a way to distinguish between multi-sided and single-sided businesses? Are any adjustments to antitrust analysis necessary to account for any special characteristics of multi-sided businesses?
2. How should the courts and agencies define relevant antitrust markets and measure market power for multi-sided platform businesses?
3. What is the relevance of network effects (direct and indirect) in multi-sided platform markets?
4. How should the courts and agencies evaluate exclusionary conduct by firms competing in multi-sided platform markets, including predatory pricing, vertical restraints, most-favored nation clauses, and actions to undermine rivals who depend on platform infrastructure?
5. Are there unique procompetitive justifications for these types of conduct by firms competing in multi-sided platform markets?
6. What is the relevant legal precedent for evaluating antitrust concerns related to multi-sided platform businesses?

Antitrust in Labor Markets (Oct. 16):

1. Is a lack of competition among employers a significant contributor to observed macroeconomic trends in labor markets, such as the declining labor share and/or real wage stagnation? What are other explanations for these trends?
2. How should the agencies approach defining relevant labor markets for purposes of antitrust analysis? What (if any) reliable evidence is available on the existence and effect of employer concentration in properly defined labor markets?
3. Does available evidence suggest a causal relationship between employer concentration and labor market outcomes, such as wage? Does this evidence suggest a change in antitrust enforcement is needed?
4. Should the agencies and courts apply the consumer welfare standard to the analysis of monopsonistic labor markets in which firms are buyers and workers are sellers?
5. How should the agencies and courts resolve cases where evidence suggests output in the product market is likely to increase but employment and wages are likely to decline because of reduced competition in a properly defined labor market?

Acquisitions of Nascent and Potential Competitors in Digital Technology Markets (Oct. 17):

1. What is the appropriate antitrust framework to evaluate acquisitions of potential or nascent competitors in high-technology markets?
2. Is current antitrust law sufficient for developing challenges to these types of acquisitions?
3. How should the antitrust agencies evaluate whether a nascent technology is likely to develop into a competitive threat in dynamic, high-technology markets?
4. What are some pragmatic approaches that the antitrust enforcement agencies could consider for enhancing their evaluation of these types of acquisitions?

Comments Due: December 15, 2018

The Commission sought comments for Hearing #1 On Competition and Consumer Protection in the 21st Century - Sept. 13-14 at Georgetown University Law Center on the following topics:

1. The current landscape of competition and consumer protection law and policy;
2. Whether the U.S. economy has become more concentrated and less competitive;
3. The regulation of consumer data;
4. Antitrust law and the consumer welfare standard; and
5. The analysis of vertical mergers.

1. The state of antitrust and consumer protection law and enforcement, and their development, since the Pitofsky hearings;
2. Competition and consumer protection issues in communication, information, and media technology networks;
3. The identification and measurement of market power and entry barriers, and the evaluation of collusive, exclusionary, or predatory conduct or conduct that violates the consumer protection statutes enforced by the FTC, in markets featuring “platform” businesses;
4. The intersection between privacy, big data, and competition;
5. The Commission’s remedial authority to deter unfair and deceptive conduct in privacy and data security matters;
6. Evaluating the competitive effects of corporate acquisitions and mergers;
7. Evidence and analysis of monopsony power, including but not limited to, in labor markets;
8. The role of intellectual property and competition policy in promoting innovation;
9. The consumer welfare implications associated with the use of algorithmic decision tools, artificial intelligence, and predictive analytics;
10. The interpretation and harmonization of state and federal statutes and regulations that prohibit unfair and deceptive acts and practices; and
11. The agency’s investigation, enforcement and remedial processes.

1. The state of antitrust and consumer protection law and enforcement, and their development, since the Pitofsky hearings

Of particular interest to the Commission:

1. the continued viability of the consumer welfare standard for antitrust law enforcement and policy;
2. economic analysis and evidence on market competitiveness, enforcement policy, and the effects of past FTC enforcement decisions;
3. the identification of new developments in markets and in business-to-business or business-to-consumer relationships;
4. the benefits and costs associated with the growth of international competition and consumer protection enforcement regimes; and
5. the advisory and advocacy role of the FTC regarding enforcement efforts by competition and consumer protection agencies outside the United States, when such efforts have a direct effect on important U.S. interests.

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2. Competition and consumer protection issues in communication, information, and media technology networks

FTC staff’s 1996 Competition Policy in the New High-Tech Global Marketplace report discussed the competitive analysis of both unilateral and joint conduct in industries subject to network effects; and FTC staff’s 2007 Broadband Connectivity and Competition Policy report addressed similar issues in the broadband internet access service market.

Of particular interest to the Commission:

1. whether contemporary industry practices in networked industries continue to present competition and consumer protection concerns like those discussed in the prior reports;
2. the welfare effects of regulatory intervention to promote standardization and interoperability;
3. the application of the FTC’s Section 5 authority to the broadband internet access service business; and
4. unique competition and consumer protection issues associated with internet and online commerce.

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3. The identification and measurement of market power and entry barriers, and the evaluation of collusive, exclusionary, or predatory conduct or conduct that violates the consumer protection statutes enforced by the FTC, in markets featuring “platform” businesses

Of particular interest to the Commission:

1. whether the platform business model has unique implications for antitrust and consumer protection law enforcement and policy; and
2. whether and how the presence of “network effects” should affect the Commission’s analysis of competition and consumer protection issues in these markets.

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4. The intersection between privacy, big data, and competition

Of particular interest to the Commission:

1. data as a dimension of competition, and/or as an impediment to entry into or expansion within a relevant market;
2. competition on privacy and data security attributes (between, for example, social media companies or app developers), and the importance of this competition to consumers and users;
3. whether consumers prefer free/ad-supported products to products offering similar services or capabilities but that are neither free nor ad-supported;
4. the benefits and costs of privacy laws and regulations, including the effect of such regulations on innovation, product offerings, and other dimensions of competition and consumer protection;
5. the benefits and costs of varying state, federal and international privacy laws and regulations, including the conflicts associated with those standards; and
6. competition and consumer protection implications of use and location tracking mechanisms.

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5. The Commission’s remedial authority to deter unfair and deceptive conduct in privacy and data security matters

Of particular interest to the Commission:

1. the efficacy of the Commission’s use of its current remedial authority; and
2. the identification of any additional tools or authorities the Commission may need to adequately deter unfair and deceptive conduct related to privacy and data security.

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6. Evaluating the competitive effects of corporate acquisitions and mergers

Of particular interest to the Commission:

1. the economic and legal analysis of vertical and conglomerate mergers;
2. whether the doctrine of potential competition is sufficient to identify and analyze the competitive effects (if any) associated with the acquisition of a firm that may be a nascent competitive threat;
3. the analysis of acquisitions and holding of a non-controlling ownership interest in competing companies;
4. the identification and evaluation of the exercise of monopsony power and buyer-power as arising from consolidation;
5. the identification and evaluation of differentiated but potentially competing technologies, and of disruptive or generational changes in technology, and how such technologies affect competitive effects analysis; and
6. empirical validation of the analytical tools used to evaluate acquisitions and mergers (e.g., models of upward pricing pressure, gross upward pricing pressure, net innovation pressure, critical loss analysis, compensating marginal cost reduction, merger simulation, natural experiments, and empirical estimation of demand systems).

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7. Evidence and analysis of monopsony power, including but not limited to, in labor markets

Of particular interest to the Commission:

1. the analytic framework applied to conduct and transactions that negatively or positively affect competition between employers as buyers in labor markets;
2. evidence regarding the existence and exercise of buyer monopsony or market power in properly defined markets, including by employers in labor markets;
3. the exercise of monopsony power through collusion, including in labor markets through employer collusion; and
4. the use of non-competition agreements and the conditions under which their use may be inconsistent with the antitrust laws.

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8. The role of intellectual property and competition policy in promoting innovation

The Commission has taken a dual-pronged approach to issues arising at the intersection of intellectual property and antitrust law:

1. antitrust enforcement against harmful business conduct involving intellectual property; and
2. competition advocacy regarding the development of intellectual property law.

The Commission has articulated its enforcement positions in a number of public documents, including the joint Commission and Department of Justice 2017 Antitrust Guidelines for the Licensing of Intellectual Property and 2007 Antitrust Enforcement and Intellectual Property Rights report. The Commission has engaged in substantial competition advocacy with respect to the legal and policy regime related to intellectual property rights, including its three “IP” reports: the 2003 To Promote Innovation report, the 2011 Evolving IP Marketplace report, and the 2016 Patent Assertion Entity Activity report. Of particular interest to the Commission:

1. the adoption and utilization of novel business practices (beyond those addressed in the Commission’s prior guidance and actions) with respect to obtaining or enforcing intellectual property rights, where such practices may be inconsistent with the antitrust laws;
2. identification of contemporary patent doctrine that substantially affects innovation and raises the greatest challenges for competition policy;
3. evaluation of intellectual property litigation in competitive effects analysis; and
4. evaluation of efficiencies and entry considerations in technology markets in merger analysis.

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9. The consumer welfare implications associated with the use of algorithmic decision tools, artificial intelligence, and predictive analytics

Of particular interest to the Commission:

1. the welfare effects and privacy implications associated with the application of these technologies to consumer advertising and marketing campaigns;
2. the welfare implications associated with use of these technologies in the determination of a firm’s pricing and output decisions; and
3. whether restrictions on the use of computer and machine learning and data analytics affect innovation or consumer rights and opportunities in existing or future markets, or in the development of new business models.

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10. The interpretation and harmonization of state and federal statutes and regulations that prohibit unfair and deceptive acts and practices

Of particular interest to the Commission:

1. whether and to what extent other enforcement entities authorized to prosecute unfair or deceptive acts and practices apply FTC precedent in their enforcement efforts; and
2. whether the Commission can, and to what extent it should, take steps to promote harmonization between the FTC Act and similar statutes.

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11. The agency’s investigation, enforcement and remedial processes

Of particular interest to the Commission:

1. whether the agency’s investigative process can be improved without diminishing the ability of the Commission to identify and prosecute prohibited conduct;
2. the extent to which the Commission’s Part 3 process facilitates timely and efficient administrative litigation;
3. the efficacy of the Commission’s current use of its remedial authority; and
4. willingness of affected parties to cooperate with the Commission in conducting post-investigation and enforcement retrospectives.

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How to Submit Public Comments

Interested parties may submit written comments on the topics listed above to the FTC. Electronic submission is preferred; comments in paper form are also accepted. FTC staff may use these comments in any subsequent reports or policy papers. Comments should refer to “Competition and Consumer Protection in the 21^st Century Hearings, Project Number P181201.” If an interested party wishes to comment on multiple topics, we encourage filing a separate comment for each topic. If an interested party wishes to make general comments about the hearings, we encourage filing a comment in response to Topic 1, using this link. For this stage of the public comment process, comments will be accepted until August 20, 2018.

Postal mail addressed to the Commission is subject to delay due to heightened security screening. As a result, we encourage you to submit your comments online. If you prefer to file your comment on paper, write “Competition and Consumer Protection in the 21^st Century Hearings, Project Number P181201” on your comment and on the envelope, and mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue, NW, Suite CC-5610 (Annex C), Washington, DC 20580; or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street, SW, 5th Floor, Suite 5610 (Annex C), Washington, DC 20024. If possible, submit your paper comment to the Commission by courier or overnight service.

Because your comment may be placed on the publicly accessible FTC Website, you are solely responsible for making sure that your comment does not include any sensitive or confidential information. In particular, your comment should not include any sensitive personal information, such as your or anyone else’s Social Security number; date of birth; driver’s license number or other state identification number, or foreign country equivalent; passport number; financial account number; or credit or debit card number. You are also solely responsible for making sure that your comment does not include any sensitive health information, such as medical records or other individually identifiable health information. In addition, your comment should not include any “trade secret or any commercial or financial information which . . . is privileged or confidential” – as provided in Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2) – including, in particular, competitively sensitive information such as costs, sales statistics, inventories, formulas, patterns, devices, manufacturing processes, or customer names.

Comments containing material for which confidential treatment is requested must be filed in paper form, must be clearly labeled “Confidential,” and must comply with FTC Rule 4.9(c). In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. See FTC Rule 4.9(c). Your comment will be kept confidential only if the General Counsel grants your request in accordance with the law and the public interest. Once your comment has been posted on the public FTC Website – as legally required by FTC Rule 4.9(b) – we cannot redact or remove your comment from the FTC Website, unless you submit a confidentiality request that meets the requirements for such treatment under FTC Rule 4.9(c), and the General Counsel grants that request.

If any entity has provided funding for research, analysis, or commentary that is included in a submitted public comment, such funding and its source should be identified on the first page of any submitted comment.

Visit the FTC Website to read this Notice and the news release describing it. The FTC Act and other laws that the Commission administers permit the collection of public comments to consider and use in this proceeding, as appropriate. For this stage of the comment process, the Commission will consider all timely and responsive public comments that it receives on or before August 20, 2018. The FTC Act and other laws that the Commission administers permit the collection of public comments. More information, including routine uses permitted by the Privacy Act, may be found in the FTC’s privacy policy.