Algorithmic Collusion and the Limits of Traditional Antitrust Enforcement: A Comparative Study of India and the European Union

The rapid expansion of artificial intelligence and algorithmic pricing systems has fundamentally transformed the functioning of digital markets. Pricing algorithms can automatically monitor competitors’ prices and adjust strategies in real time, potentially leading to coordinated pricing outcomes without explicit communication among firms. This phenomenon, commonly referred to as algorithmic collusion, challenges the traditional foundations of competition law that rely on proving agreements or concerted practices between human actors. This paper critically examines whether existing competition law frameworks in India and the European Union are capable of addressing the risks posed by algorithmic collusion. The study analyses the Competition Act, 2002 in India and Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU), alongside emerging regulatory instruments such as the EU Digital Markets Act (DMA) and India’s proposed Digital Competition Bill. Through a doctrinal and comparative analysis, the paper identifies structural limitations within traditional antitrust enforcement mechanisms when applied to AI-driven markets. The study concludes that algorithmic pricing systems create new forms of tacit coordination that may evade existing legal thresholds for collusion. Consequently, competition authorities may need to adopt hybrid regulatory models combining antitrust enforcement with ex-ante digital market regulation.