RealTime IT News

FTC Worried About Barriers to E-Commerce

The Federal Trade Commission, concerned that some state regulations and private business practices may be having "significant" anti-competitive effects on e-commerce, is planning a three-day workshop on the matter.

FTC Chairman Timothy J. Muris said at a news conference in Washington that "there are many state regulations adopted ostensibly for one purpose that had the effect of protecting existing businesses from Internet competition."

"The purpose of the workshop is to give us an increased understanding of the issues," he said.

The FTC said that for example, some states prohibit online sales of certain products or require that e-businesses maintain a physical office in their state.

The FTC said that some estimates suggest that the potential costs to consumers of these anti-competitive restrictions "may exceed $15 billion annually."

Industries in which significant restrictions on Internet commerce have been alleged, according to the FTC, include retailing, auto sales, real estate and mortgages, health care, pharmaceuticals, telemedicine, the sale of wine, auction services, the sale of contact lenses and the sale of caskets.

One specific topic will be "whether auto manufacturers been forced to limit Internet sales of automobiles, and if so how?"

"I'd be surprised if we don't have additional investigations," Muris said. "We think the workshops will facilitate further work on our part ... it's an important topic."

On the private business side, the FTC said that some private companies "have engaged in conduct that may raise antitrust issues ... For instance, some dealers do not list prices for certain items they sell online; others refrain from selling certain items in their product line over the Internet at all, and urge competitors to follow suit."

"The willingness of businesses to use the government to restrict competition remains at a high level," Muris said. "Reducing the barriers to e-commerce could dramatically increase competition and benefit consumers."

"E-commerce has tremendous potential, especially if anti-competitive barriers to dynamic new forms of Internet competition can be understood and eliminated," said Ted Cruz, the FTC's director of policy planning.

The workshop will take place Oct. 8-10 at FTC headquarters.