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1. The Impact of Increased Mass Litigation in Europe

Author:
Fredrik Erixon, Oscar Guinea, Dyuti Pandya, Vanika Sharma, Elena Sisto, Oscar du Roy, Renata Zilli, and Philipp Lamprecht
Publication Date:
03-2025
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The purpose of this study is to better understand the growth of mass litigation in the European Union (EU) and its economic consequences. European authorities have long encouraged consumers to seek redress through private litigation in European competition law and, more recently, they have shifted their focus towards collective actions in a broad range of areas, including data privacy and product liability. Facilitating access to justice through collective actions is not a cost-free option. Unfortunately, there is a lack of economic analysis on the consequences of an increase in collective action cases in the EU. It is crucial to understand the economic consequences of a “mixed regime” – that is, a regime based on both ex-ante public enforcement through regulation and ex-post enforcement through private litigation. The combination of these two enforcement models raises questions about how the system is intended to work together and what the consequences might be for the economy. This study examines the economic implications of these developments in the EU.
Topic:
Law, European Union, Regulation, Regional Economy, and Litigation
Political Geography:
Europe

2. EU Export of Regulatory Overreach: The Case of the Digital Markets Act (DMA)

Author:
Matthias Bauer, Dyuti Pandya, and Vanika Sharma
Publication Date:
04-2025
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The EU’s Digital Markets Act (DMA) exemplifies the “Brussels Effect,” extending the EU’s regulatory influence beyond its borders and shaping global digital competition policies. While intended to curb the market power of large technology platforms and promote fair competition, its broad, rigid, and pre-emptive approach risks stifling technological development, deterring investment, and creating legal uncertainty, particularly in emerging markets still building digital infrastructure and seeking to attract foreign investment. Large technology firms play a pivotal role in global economic development, driving innovation, infrastructure upgrading, and consumer welfare. However, increasing regulatory scrutiny, particularly under DMA-like frameworks, could inadvertently harm the very markets they help grow by imposing compliance burdens that hinder business expansion and technology diffusion. Countries with weaker institutions and regulatory capacity – such as India, Brazil, South Africa, and other emerging market and developing economies (EMDEs) like Indonesia – could face greater risks of regulatory capture, corruption, and enforcement challenges if they replicate the EU’s approach without adapting it to their economic realities (Section 2). A key concern with the DMA is the departure from traditional case-by-case enforcement in competition policy, instead relying on broad, pre-emptive obligations based on ambiguous concepts such as fairness and contestability. This shift reduces legal certainty, increases the risk of inconsistent enforcement, and may inhibit dynamic competition, which is essential for innovation-driven sectors like fintech, e-commerce, ICT, and edtech. By prioritising static over dynamic competition, the DMA could impede technological progress, limiting consumer choice and long-term economic benefits (Section 3). The global adoption of DMA-like regulations risks further regulatory fragmentation and may create unintended consequences, particularly in emerging economies where regulatory frameworks, institutional quality, and market structures differ significantly from the EU. Broad prohibitions on business practices, such as self-preferencing and data-sharing, could limit opportunities for local firms to scale internationally, weaken cybersecurity protections, and reduce incentives for large technology firms to invest in these regions (Section 4). To ensure proportionate and effective competition enforcement, governments outside the EU should prioritise regulatory flexibility and case-by-case assessments over broad, static restrictions. OECD best practices on competition policy emphasise clear objectives, legal certainty, and regulatory proportionality, ensuring that competition enforcement supports, rather than stifles, innovation and investment (Section 5). Moreover, the risks of corruption and regulatory overreach in developing countries make broad ex-ante regulations especially problematic. Excessive discretionary power granted to local authorities could increase the risk of politically motivated enforcement, deter foreign investment, and undermine long-term economic growth. A more effective approach would be to strengthen institutional frameworks, enhance transparency, and adopt supply-side policies that support technology neutrality, free trade, and economic freedom.
Topic:
Science and Technology, European Union, Regulation, Digital Markets Act (DMA), and Economic Competition
Political Geography:
Europe

3. Time to Rethink Export Controls for Strengthened US-EU Cooperation and Global Trade Rules

Author:
Matthias Bauer and Dyuti Pandya
Publication Date:
04-2024
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The escalation of broad export controls by the US, under the guise of national security and the aim to curb technological transfers to potential adversaries,[1] marks a new epoch of bureaucratic oversight. The US push for broad export controls also underscores a critical juncture in US-EU relations and global trade rules. Broad export restrictions not only challenge the very foundation of free trade but also contribute to the erosion of Western technology leadership.[2] Unilateral export controls may start strong but eventually lose effectiveness and become counterproductive,[3] pushing non-US companies, particularly in the semiconductor sector, to find alternatives to US components.
Topic:
International Cooperation, European Union, Regulation, Exports, Trade, and Semiconductors
Political Geography:
Europe and United States of America

4. Shared Liability: The European Parliament’s Misstep in Fighting Financial Fraud

Author:
Matthias Bauer, Andrea Dugo, and Dyuti Pandya
Publication Date:
11-2024
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The rise in financial fraud has prompted regulatory proposals under the Payment Services Regulation in the form of a shared liability model provisioned under Article 59. The potential proposal by the European Parliament could now extend liability beyond Payment Service Providers to Electronic Communications Service Providers and online platforms. While the intent to address fraud is commendable, this model misallocates responsibilities by requiring non-financial entities to oversee fraudulent activities, despite their lack of visibility and technical control over financial transactions. Extending liability to non-financial entities risks undermining consumer vigilance and diluting payment services providers’ efforts to maintain fraud awareness. A shared liability regime covering non-financial entities would also disproportionately burden smaller “digital” firms, leading to legal uncertainties, costly legal disputes, and market exits. This would not only drive market concentration and reduce competition in digital services but also undermine EU and Member State efforts to support Europe’s lagging digital start-ups and scale-ups. The resulting harm to innovation and entrepreneurship would be a significant setback to the EU’s broader digital ambitions.
Topic:
European Union, Regulation, Services, European Parliament, Fraud, and Liability
Political Geography:
Europe

5. AI and India’s National Interest

Author:
Hosuk Lee-Makiyama, Badri Narayanan Gopalakrishnan, Claudia Lozano, and Dyuti Pandya
Publication Date:
12-2024
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
AI offers a policy dilemma for India. On the one hand, export competitiveness hinges on the nationwide deployment of productivity-enhancing technologies. Indian services and consultancies must incorporate AI technologies to keep their leading position in the global market. On the other hand, there are also concerns over automation’s impact on social cohesion, discriminatory algorithmic decision-making, and the risks of “deepfakes”. However, the current transitional guidelines have shown a feasible pathway to avoiding overlapping liability or regulatory blindspots by re-interpreting existing legislation. India has a comprehensive framework for antitrust, corporate liability, free speech, and public order that covers AI development and use cases. India may not need AI-specific rules. Currently, only the EU has chosen to legislate through binding laws due to its unique structural deficiencies. The EU lacks a supranational constitution that safeguards human rights and protects citizens against AI-based surveillance or policing by its Member States. The EU must enact binding rules to pre-empt AI laws by national governments that will otherwise fragment its Single Market. Whereas India has previously taken inspiration from the EU or the US laws, India must follow its own paths and pursue its national interests based on its services-driven industrial profile and the two-way competition against China and the US, who have chosen not to impose any regulatory impediments on AI use or development. India’s challenge lies not in whether businesses prefer a local or foreign AI platform but in encouraging rapid adoption and supporting open-source and other alternatives accessible for fine-tuning and transfer learning for its IT industry.
Topic:
Regulation, Digital Economy, Exports, and Artificial Intelligence
Political Geography:
South Asia and India