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/ Personal Data Protection and Free Competition

19 January, 2022

The current trend is to make free competition compatible with the protection and use of personal data, in such a way that companies use this data correctly, for example, by breaking down barriers to entry and sharing the information they possess, but always protecting the data without violating it.

María Ignacia Ormeño Sarralde
Associate Attorney
Alessandri Abogados

 

The advent of digital transformation has made it easier for people in their daily lives to deliver a large amount of personal information, without taking into consideration what their delivery means for providers of products and services.  Data such as telephone number, email or personal habits, behavior, preferences, geolocation data, biometric data, among others, are delivered every day through various platforms on our phones and computers.  Likewise, the increase in computing capacity and analysis of personal data has brought as a consequence the desire of companies to have more data to better know their consumers and predict their behavior.

Personal data should be considered as a raw material or asset for companies.  It is therefore necessary to ask: How much is this data worth to a company? How do they use or value it?

The ability to collect, store, analyze and use data gives a company a dominant position, i.e. it allows it to intervene in the relevant market of a good or service or of a certain group of goods or services, achieving a significant share in that market.

This has led to numerous changes in the business strategy of companies.  The way in which they collect or use the data is of concern due to the possible violations that could affect free competition, in the sense of generating conducts such as tacit collusion by algorithms, acquisition of market shares or market power, or entry barriers.

Currently, with the enactment of the “Pro-Consumer Law” (Law No. 21,398), which grants the National Consumer Service (Sernac) express powers to protect personal data in a consumer relationship, this authority, together with those responsible for ensuring the protection of free competition, have the task of safeguarding that the use of this large amount of personal data, on the one hand, does not lead to consumers in their rights and on the other to safeguard free competition and market concurrence.