Competition Law and Adaptive Competition Governance for Emerging Technologies

1. Introduction

Adaptive competition governance means designing competition-law institutions and enforcement methods that can respond to rapidly changing technologies rather than relying only on traditional, static market definitions and slow enforcement procedures.

Emerging technologies such as artificial intelligence (AI), cloud computing, advanced semiconductors, autonomous systems, biotechnology, digital platforms, quantum computing and extended-reality technologies can change market structures very quickly. A company that is not dominant today may acquire important technological assets, data, infrastructure, intellectual property or distribution advantages that create substantial competitive significance tomorrow.

Therefore, competition governance increasingly needs to examine not only current market share, but also:

• control over essential technological infrastructure;
• access to data and computing resources;
• interoperability;
• network effects;
• switching costs;
• ecosystems and technological lock-in;
• access to application programming interfaces;
• control over standards;
• vertical integration;
• acquisitions of emerging competitors;
• innovation competition;
• algorithmic conduct;
• access to AI models and computing capacity; and
• the possibility of future foreclosure.

The European Commission's recent work illustrates this adaptive approach. In 2026, it identified AI and cloud services as important competition priorities, including investigations concerning cloud services and measures concerning AI interoperability.

2. Meaning of Adaptive Competition Governance

Traditional competition law generally asks:

What is the relevant market, who has market power, and has the undertaking engaged in conduct that harms competition?

Adaptive governance adds another dimension:

How is technology changing the structure of competition, and should enforcement tools change accordingly?

It therefore combines conventional antitrust law with:

1. continuous market monitoring;
2. technology-specific investigations;
3. interoperability obligations;
4. data-access mechanisms;
5. prospective merger scrutiny;
6. regulatory experimentation;
7. rapid remedies;
8. algorithmic and technical auditing;
9. cross-regulatory cooperation; and
10. periodic reassessment of market conditions.

The objective is not to protect every competitor. The objective is to preserve competitive processes, innovation opportunities, contestability and consumer choice.

3. Why Emerging Technologies Require Adaptive Governance

A. Rapid technological change

Technology markets can change much faster than ordinary regulatory processes.

For example:

• smartphones changed mobile computing;
• cloud computing changed IT infrastructure;
• generative AI changed software and search competition;
• foundation models are changing software development;
• advanced chips increasingly determine access to computational capacity.

A market definition based on yesterday's technology can therefore become obsolete.

B. Innovation may be more important than current price

In traditional markets, competition analysis often focuses heavily on:

• prices;
• output;
• market shares.

In emerging technology markets, however, important competitive dimensions may include:

• research and development;
• product quality;
• model performance;
• processing speed;
• interoperability;
• security;
• data access;
• developer ecosystems; and
• future innovation.

The Illumina/GRAIL litigation is particularly important because the competition concerns included the possibility that vertical integration could reduce innovation in a developing technology market. The FTC ultimately required divestiture, while subsequent judicial proceedings also addressed the legal standards applicable to the transaction.

4. Core Elements of Adaptive Competition Governance

4.1 Dynamic Market Definition

Competition authorities should not examine only existing products.

They should consider:

• technological substitutability;
• potential competition;
• innovation pipelines;
• emerging substitutes;
• technological convergence;
• supply-side substitution; and
• future competitive constraints.

For example, AI search, conventional search, AI assistants and specialised information services may increasingly overlap.

4.2 Interoperability

Interoperability can prevent dominant technological ecosystems from becoming closed systems.

Important questions include:

• Can competing services communicate with the dominant platform?
• Can developers access necessary technical functionality?
• Can users move their data?
• Can alternative applications interact with operating-system features?

This has become particularly important for AI.

In July 2026, the European Commission issued binding specification measures concerning Google's Android ecosystem, including access by competing AI services to relevant Android functionality.

Thus, interoperability is evolving from a technical issue into a competition-governance mechanism.

5. Data as a Competitive Resource

Emerging technology markets frequently depend upon large datasets.

Data can create competitive advantages because it can improve:

• AI training;
• recommendation systems;
• search results;
• advertising;
• personalization;
• fraud detection; and
• product development.

Adaptive competition governance therefore examines whether a dominant undertaking:

• refuses access to commercially important data;
• uses exclusive data arrangements;
• combines datasets in ways that exclude competitors;
• gives its own services preferential access;
• prevents data portability; or
• uses data obtained from one market to strengthen another market.

The European Commission's 2026 Google proceedings illustrate this direction: the Commission has addressed access by third-party search engines to search-related data under the DMA.

6. Cloud Computing and Infrastructure Power

Cloud infrastructure presents another important governance challenge.

A cloud provider can potentially control:

• computing capacity;
• storage;
• AI infrastructure;
• developer tools;
• data-management services;
• software marketplaces;
• technical standards; and
• switching conditions.

This creates a possibility that infrastructure power could influence competition in downstream markets.

In November 2025, the European Commission opened three DMA market investigations concerning cloud computing, including investigations concerning Amazon Web Services and Microsoft Azure and whether the DMA can address potentially unfair or anti-competitive cloud practices.

By June 2026, the Commission had announced preliminary views that AWS and Azure should be designated as DMA gatekeepers for cloud services despite not satisfying the ordinary quantitative thresholds.

This demonstrates an important adaptive principle:

Formal market-share thresholds may not always capture technological gatekeeping power.

7. AI and Algorithmic Competition

AI introduces several competition questions.

Possible concerns include:

1. Access to computing power

A small number of companies may control important AI infrastructure.

2. Data advantages

Large platforms may possess datasets unavailable to rivals.

3. Distribution advantages

A dominant operating system or search engine can potentially give its own AI assistant preferential distribution.

4. Default settings

Default AI services can influence user adoption.

5. Bundling

AI functionality can potentially be bundled with dominant software products.

6. Interoperability

Competing AI services may need access to operating-system functions.

7. Vertical integration

Infrastructure providers may also operate AI applications competing with their own infrastructure customers.

These issues demonstrate why AI competition policy cannot depend entirely upon traditional market-share analysis.

8. Six Important Case Laws

Case 1 — Google Android

Google LLC (Android), European Commission, 2018

The European Commission found Google responsible for several practices involving Android, including restrictions concerning manufacturers and mobile application distribution.

The case concerned the interaction between:

• operating systems;
• app distribution;
• search services;
• defaults;
• licensing arrangements; and
• ecosystem power.

The Commission's decision was based on Article 102 TFEU.

Importance for emerging technology

Google Android demonstrates that competition problems can arise from ecosystem architecture, rather than simply from the price of an individual product.

It provides an important foundation for modern analysis of:

• mobile ecosystems;
• AI assistants;
• default services;
• interoperability; and
• platform dependence.

Case 2 — Qualcomm and Apple

Qualcomm Inc. v European Commission / Qualcomm exclusivity-payment proceedings

Qualcomm's arrangements with Apple concerning LTE chipsets were examined under EU competition law.

The Commission considered whether Qualcomm's payments were linked to Apple's obtaining its requirements of LTE chipsets from Qualcomm and whether those arrangements could restrict rival suppliers.

The later General Court litigation concerning Qualcomm also examined issues including:

• relevant-market definition;
• dominance;
• price-cost analysis;
• exclusionary conduct; and
• predatory pricing. 

Importance

The case demonstrates the importance of analysing technology supply chains.

In emerging technology markets, competition may depend upon access to:

• semiconductor components;
• processors;
• connectivity technologies;
• AI accelerators;
• hardware interfaces.

Therefore, competition governance must examine both downstream products and upstream technological inputs.

Case 3 — Illumina/GRAIL

Illumina, Inc. and GRAIL, Inc.

Illumina was a major supplier of DNA-sequencing technology, while GRAIL developed a multi-cancer early-detection technology using sequencing.

The FTC challenged Illumina's acquisition of GRAIL, arguing that the transaction could reduce innovation and competition in the developing market for multi-cancer detection tests. In 2023, the FTC ordered divestiture; subsequent Fifth Circuit proceedings addressed the Commission's reasoning and evidentiary standards, and Illumina announced that it would divest GRAIL.

The EU litigation also produced an important 2024 Court of Justice judgment concerning the Commission's jurisdiction under the EU Merger Regulation and Article 22 referral mechanism.

Importance

This case illustrates innovation-based merger control.

A transaction involving an emerging technology should not necessarily be evaluated solely according to current sales or market shares.

Authorities may need to examine:

• innovation pipelines;
• future competitors;
• access to critical infrastructure;
• technological bottlenecks;
• vertical foreclosure;
• future R&D competition.

Case 4 — Broadcom/VMware

Broadcom/VMware, European Commission, 2023

The European Commission reviewed Broadcom's proposed acquisition of VMware, an important transaction involving semiconductor and enterprise software technologies.

The Commission opened an in-depth investigation because of competition concerns, and ultimately approved the transaction subject to commitments.

The case included concerns relating to interoperability and access within the virtualization ecosystem.

Importance

This case shows why technical interoperability can become a merger remedy.

In technology markets, structural competition can sometimes depend upon whether customers and rival products can continue to interact with important technical systems.

Case 5 — Microsoft/Teams

Microsoft Teams — European Commission

The Commission investigated Microsoft's inclusion of Teams within Microsoft 365/Office 365 products.

The preliminary assessment concerned whether Microsoft had abused dominance by tying Teams to its productivity applications. The Commission identified separate markets for productivity applications and unified communications/collaboration services.

Microsoft subsequently made changes to its distribution arrangements.

Importance

The case illustrates bundling and ecosystem leverage.

The same analytical problem can arise with emerging AI products:

If a company controls a dominant software ecosystem, should it be allowed to automatically bundle its own new AI service into that ecosystem in ways that disadvantage competing AI services?

The answer depends on the facts and applicable law, but the Microsoft case provides a framework for analysing that question.

Case 6 — Google Search/AI Interoperability under the DMA

European Commission — Google Android AI interoperability proceedings, 2026

This is particularly relevant to emerging technologies.

In January 2026, the Commission opened proceedings concerning Google's obligation to provide third-party developers with effective interoperability with Android's hardware and software features, including features used by Google's own AI services such as Gemini.

In July 2026, the Commission issued binding specification measures concerning AI interoperability and search-data access.

Importance

This represents a more ex ante form of competition governance.

Instead of waiting for conventional antitrust litigation to establish harm after the market has already tipped, the regulatory framework establishes obligations intended to maintain contestability.

9. Comparison of the Six Cases

10. Ex-Ante and Ex-Post Enforcement

Adaptive governance normally combines two approaches.

Ex-post enforcement

Authorities investigate conduct after it occurs.

Examples include:

• abuse of dominance;
• exclusionary rebates;
• tying;
• predatory pricing;
• anti-competitive agreements.

Ex-ante regulation

Authorities establish obligations before competitive harm becomes entrenched.

Examples include:

• interoperability;
• data portability;
• access requirements;
• steering rights;
• restrictions on self-preferencing;
• obligations imposed on designated gatekeepers.

The EU's DMA increasingly represents the second approach. Its application to AI and cloud services demonstrates the movement toward technology-sensitive, forward-looking competition governance.

11. Adaptive Remedies

Traditional remedies may not always work effectively in technology markets.

Possible adaptive remedies include:

1. Interoperability

Competitors receive technical access to important systems.

2. Data portability

Users or businesses can transfer relevant data to alternative providers.

3. Data access

Certain competitively important datasets may need to be made available under defined conditions.

4. API access

Rivals may receive access to technical interfaces necessary for interoperability.

5. Non-discrimination

A dominant platform may be prevented from giving its own competing service preferential treatment.

6. Structural remedies

In serious cases, divestiture or separation may be considered.

7. Monitoring trustees

Independent monitoring can ensure that technological remedies actually operate in practice.

12. Algorithmic Governance

Emerging competition governance also needs to consider algorithms.

Algorithms can influence:

• prices;
• rankings;
• recommendations;
• search results;
• advertising;
• product visibility;
• access to platforms.

Competition authorities therefore increasingly need technical expertise capable of examining:

• algorithmic decision-making;
• automated pricing;
• ranking systems;
• recommendation engines;
• AI models;
• data pipelines.

This means that future competition authorities may need economists, lawyers, computer scientists, data scientists and cybersecurity specialists working together.

13. Innovation Competition

One of the most important concepts is innovation competition.

Two companies may compete even when they currently sell different products.

For example:

Company A sells an established technology, while Company B is developing a technology that could replace it.

Traditional market-share analysis might undervalue Company B because it has little current revenue.

Adaptive competition governance therefore asks:

• Is the emerging technology a potential competitive constraint?
• Is the company an important innovator?
• Does the acquisition remove future competition?
• Does vertical integration create incentives to exclude rival innovators?
• Could control over infrastructure prevent technological entry?

This reasoning is particularly important in AI, biotechnology, semiconductors and cloud computing.

14. Regulatory Sandboxes and Emerging Technology

Competition authorities can also use controlled regulatory experimentation.

A regulatory sandbox can allow authorities to:

1. observe new technologies;
2. identify competition risks;
3. communicate with technology developers;
4. test compliance approaches;
5. collect market evidence;
6. refine regulatory obligations.

This can reduce the risk of applying outdated rules to technologies that regulators do not yet fully understand.

15. Cross-Regulatory Cooperation

Emerging technology frequently crosses legal boundaries.

For example, AI can simultaneously involve:

• competition law;
• data protection;
• consumer protection;
• intellectual-property law;
• cybersecurity;
• telecommunications regulation;
• financial regulation.

Competition authorities therefore increasingly need cooperation with other regulators.

However, competition law should retain its own analytical purpose: protecting the competitive process rather than attempting to regulate every technological risk.

16. Challenges of Adaptive Competition Governance

A. Regulatory uncertainty

Rapidly changing rules can increase compliance costs.

B. Risk of over-regulation

Intervention that is too aggressive could potentially reduce incentives to innovate.

C. Risk of under-enforcement

Waiting too long can allow technological ecosystems to become difficult to challenge.

D. Technical complexity

Competition authorities need sophisticated technical expertise.

E. Global markets

AI, cloud computing and semiconductor markets frequently operate internationally.

F. Evidence problems

Authorities may have difficulty obtaining:

• proprietary algorithms;
• internal datasets;
• technical documentation;
• confidential contracts;
• model-training information.

G. Remedy design

A remedy that looks effective legally may be ineffective technically.

Therefore, remedies must be measurable, monitorable and technologically adaptable.

17. A Possible Adaptive Governance Framework

A comprehensive framework can be structured into seven stages:

Stage 1 — Technology Mapping

Identify:

• infrastructure;
• platforms;
• datasets;
• algorithms;
• standards;
• distribution channels.

Stage 2 — Market Mapping

Identify:

• current competitors;
• potential competitors;
• adjacent markets;
• emerging substitutes.

Stage 3 — Power Assessment

Examine:

• market share;
• switching costs;
• network effects;
• data advantages;
• interoperability;
• entry barriers.

Stage 4 — Conduct Monitoring

Monitor:

• tying;
• bundling;
• exclusivity;
• self-preferencing;
• discriminatory access;
• predatory pricing;
• refusal to deal.

Stage 5 — Innovation Assessment

Examine:

• R&D pipelines;
• future products;
• potential competition;
• acquisition of innovative startups.

Stage 6 — Remedy Selection

Choose among:

• behavioural remedies;
• interoperability;
• data access;
• portability;
• non-discrimination;
• structural remedies.

Stage 7 — Continuous Review

The market should be reassessed because the technology itself may change.

18. Indian Competition-Law Relevance

The same principles are increasingly relevant to India because emerging technology markets may involve:

• digital platforms;
• fintech;
• AI services;
• cloud infrastructure;
• app ecosystems;
• digital payments;
• online marketplaces;
• semiconductor supply chains.

The Competition Act framework can address traditional competition concerns, while India's evolving digital-competition architecture raises additional questions concerning ex-ante obligations, gatekeeper power, data advantages, interoperability and ecosystem effects.

For emerging technologies, the key analytical challenge is therefore to combine traditional competition-law concepts such as dominance, abuse, combinations and appreciable adverse effect on competition with a more dynamic understanding of technological markets.

19. Conclusion

Adaptive Competition Governance for Emerging Technologies represents a shift from a purely static model of antitrust enforcement toward a continuous, technology-sensitive and forward-looking system.

Its central principles are:

1. Markets must be analysed dynamically.
2. Innovation can be a central dimension of competition.
3. Data and computing infrastructure can create competitive advantages.
4. Interoperability can preserve contestability.
5. Emerging competitors may matter even before they obtain substantial market share.
6. Technology acquisitions require examination of future competitive effects.
7. Ex-ante and ex-post enforcement can operate together.
8. Remedies must be technically workable and periodically reviewed.
9. Competition authorities need multidisciplinary technical expertise.
10. Governance should adapt as technology and market structures evolve.

The recent development of EU competition policy illustrates this movement clearly: AI interoperability, search-data access and cloud computing are now being addressed through mechanisms designed specifically for rapidly evolving digital ecosystems.