As artificial intelligence becomes increasingly embedded in business decision-making, New Zealand businesses need to understand and manage the competition law risks that may arise from the use of AI and algorithmic tools.
Law firm Bell Gully has released a new report in its Big Picture series, exploring the competition law risks associated with artificial intelligence. The report looks at how algorithmic collusion and AI-enabled cartel conduct may arise, the evolving regulatory landscape in New Zealand and overseas, and the practical steps businesses can take to mitigate these new risks.
Bell Gully partner Glenn Shewan, one of the authors of Algorithmic collusion and AI cartels: risks under New Zealand’s Commerce Act, said AI presents some significant opportunities for New Zealand businesses but also raises new competition law risks for businesses, which regulators are watching.
“AI is transforming how businesses make decisions across their operations. While these tools can deliver significant benefits, they can also create competition law risks that businesses may not immediately recognise” said Shewan.
“New Zealand’s competition rules apply whether decisions are made by people or algorithms. Businesses remain responsible for the competitive outcomes produced by their AI tools.”
Shewan said the Commerce Commission has identified AI and pricing algorithms as an area of focus and signalled it will monitor developments closely.
Businesses that understand these risks early and implement appropriate governance, oversight and compliance measures will be better placed to capture the benefits of AI while minimising legal and regulatory exposure, he said.
“International regulators are already taking action on AI-enabled cartel conduct and algorithmic pricing practices. Given those global enforcement trends, New Zealand businesses should expect increasing scrutiny in this area,” said Shewan.
Disclaimer: This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.
