UNIVERSITEIT VAN AMSTERDAM
The Environment and
Competition Law
Should the EU take action?
Bob Bulthuis – <email>Date: 18 July 2016 Student number: <xxx>
Master: International and European Law – European Competition Law and regulation Supervisor: mw. dr. K.J. (Kati) Cseres
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Abstract
This thesis explores which place the environment has within competition law. So-called environmental agreements between competitors are no exception anymore and now it is up to the competition authorities to decide whether they are allowed under article 101 TFEU and the national equivalents. Out of the 28 Member States the Netherlands and Germany are chosen to do more in depth research. Depending on the differences and special characteristics of these two jurisdictions an answer will be given to the question whether or not the European Commission should take action on this issue.
Problematic in giving the environment a place within competition law are the definitions of “consumer welfare” and the issue of “economic efficiencies”. The Netherlands clearly tries to find the limits of what is possible under European law. The Dutch Ministry of Economic Affairs and the competition authority (ACM) have issued ‘Policy Rules’, a vision document and a vast amount of cases had been decided upon. On the other side of the spectrum there is Germany. The German competition authority (BKartA) opts for self-regulation by the industry and a silent acceptance of certain environmental agreements (Duldungspraxis). Together with the fact that more and more consumers are pushing undertakings to move towards a more sustainable and environmental friendly operation of their businesses, one cannot deny that competition law practitioners can no longer refuse to ignore the environment as an element of competition law. I will first analyze if there is room for the Commission to incorporate the environment in the competition chapter of the TFEU. Afterwards an answer will be given to the question whether the Commission should come into action by providing more clarity to undertakings and NCA’s. The answer is based on the Dutch and German jurisdictions. The research question is formulated as follows: What is the position of the
German and Dutch National Competition Authorities towards environmental agreements under article 101 TFEU? And can this position work as a bottom-up approach for the European Commission to act upon?
In short, the conclusion that can be drawn from the analyses in this thesis is that something should change. The Commission is the institution that should take the lead in providing guidance to the competition authorities in the Member States. Whether this takes the form of guidelines, block-exemptions or other solution is of less importance.
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Contents
1. Introduction ... 3 1.1. Methodology ... 4 2. European Union ... 6 2.1. Introduction ... 62.2. Overview of the EU’s practices ... 6
2.2.1. Environmental agreements on the basis of 101(1) ... 7
2.2.2. Environmental agreements on the basis of 101(3) ... 8
2.2.3. Self-regulation ... 12
2.2.4. The Environment as an overall EU objective ... 14
2.3. Conclusion ... 16
3. The Netherlands ... 18
3.1. Introduction ... 18
3.2. Overview of the ACM’s practice ... 18
3.2.1. The role of the Policy Rule ... 19
3.2.2. The role of the Vision Document ... 24
3.3. Conclusion ... 26
4. Germany ... 28
4.1. Introduction ... 28
4.2. Overview of the BKartA’s practice ... 28
4.2.1. Situation until 2005 ... 28 4.2.2. Situation after 2005 ... 32 4.3. Conclusion ... 36 5. Conclusion ... 38 6. Bibliography ... 40 7. Appendix ... 46 Email Ludger Breuer (n141): ... Fout! Bladwijzer niet gedefinieerd. Emails local competition authorities in Germany (n142): ... Fout! Bladwijzer niet gedefinieerd.
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1. Introduction
Polluted air, rivers, the seabed; climate change is not limited to the territory of one single Member State or even parts of a Member State. The same applies to competition law. National competition laws often apply simultaneously with article 101 Treaty on the
Functioning of the European Union (TFEU).1 This thesis is about the combination of article
101 TFEU and the Dutch and German equivalents, and the environment. Article 101(1) TFEU prohibits “all agreements between undertakings, decisions by associations of
undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the internal market”.2 If an agreement falls under the first paragraph of article 101 it is
declared void under paragraph 2. On the basis of paragraph 3, an agreement falling under paragraph 1 can be exempted if it fulfills the four cumulative criteria.
The environment is a non-economic element. Non-economic elements are of paramount importance in competition law. More and more undertakings conclude agreements with each other on a wide variety of non-economic topics. Examples encompass sports, advertisements for cigarettes and liquor (related to health), collective labor agreements and copyright law.3 It cannot be denied that the environment is also part of this list. Especially in the light of some societal developments: such as the Corporate Social Responsibility (CSR) of undertakings, increasing globalization of the world’s market and the intertwined relationship between governments and undertakings.4 The environment is an element which plays a role in all three
of these societal developments.
European Union (EU) Member States incorporate or try to incorporate agreements that benefit the environment (environmental agreements) in their national competition laws. This justifies the question if the European Commission (Commission) should come into action. Different approaches could lead to a significant legal problem. The fact that the environment and competition law contain many cross-border elements only adds to the legal problem. We
1 Regulation 1/2003 of 16 December 2002 [2003] OJ L1/1 (Regulation 1/2003) art 3(1). 2 Citation taken from Article 101(1) TFEU.
3 L Breuer Das EU-Kartellrecht im Kraftfeld der Unionsziele: Die finale Programmierung der Unionstätigkeit
durch die Querschnittsklauseln am Beispiel des Art. 101 AEUV (Nomos|C.H. Beck Baden-Baden 2013) (Breuer 2013) 34.
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live in a world where more is expected from undertakings than only serving their own (financial) interests.
The Horizontal Guidelines of 20015 included a chapter on how to assess environmental agreements under EU competition law. In the Horizontal Guidelines of 20116, this chapter
was left out. In the Netherlands the policy makers try to fill this gap. The Ministry of Economic Affairs and the Dutch National Competition Authority (NCA), Autoriteit
Consument en Markt (ACM), have published several documents on how to deal with
environmental agreements that harm competition on the market. In Germany there seems to be a lot less activity in the field of competition law and the environment, or at least it is dealt with from a different perception. How can this be and is this a reason for the Commission to act upon? Both of these questions will be answered in this thesis. Therefore the main question is divided into two parts and formulated as follows: What is the position of the German and
Dutch National Competition Authorities towards environmental agreements under article 101 TFEU? And can this position work as a bottom-up approach for the European Commission to act upon?
After a short overview of the methodology used, this thesis will start in Chapter 2 with some cases decided upon by the Commission and a more general overview of how the environment forms a part of EU law and in particular EU competition law. Chapter 3 will contrast the practices of the ACM and the Dutch regulator with that of the EU. The Dutch are clearly taking a leading position in the field of the environment and competition law. In Chapter 4 the German jurisdiction is discussed. They take a somewhat different approach than the Netherlands. Finally an answer to the main question written down above will be given in Chapter 5.
1.1. Methodology
Choosing for environmental agreements and the relationship with article 101 TFEU as the topic of this thesis originated from the remarkable Chicken of Tomorrow analysis of the ACM.7 The analysis was widely criticized in the Dutch media.8 To contrast the Dutch
5 Commission Notice – Horizontal Guidelines (2001/C 3/02) [2001] OJ C3/2 (Horizontal Guidelines 2001). 6 Communication from the Commission - Horizontal (2011/C 11/01) [2011] OJ C11/1 (Horizontal Guidelines
2011).
7 ACM’s analysis of the sustainability arrangements concerning the ‘Chicken of Tomorrow’ [2015]
ACM/DM/2014/206028/ (Chicken of Tomorrow 2015).
8 For media publications see: --‘Vervanger plofkip mag niet van kartelwaakhond’ NOS
<http://nos.nl/artikel/2015539-vervanger-plofkip-mag-niet-van-kartelwaakhond.html> (18 April 2016); --‘De Kip van Morgen (4)’ NPO Radio 1 <http://www.radio1.nl/item/297157-De-Kip-van-Morgen-(4).html> (18
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position, the German position has been chosen. This thesis does not allow room for an in depth research on all 28 Member States. For language issues and because Germany is an important trading partner for the Netherlands (my home jurisdiction), the choice has been made to only analyze these two jurisdictions in combination with using the applicable European rules as a reference.
Source selection started by using terms as “environment”, “competition law”,
“sustainability”, “Umweltbelange”, “Wettbewerbsrecht” and “non-economic” in several databases. The terms were used either separately or in combination with each other. This led to many articles, books, columns, blogposts and case-law. Not all of them proved to be relevant and many were outdated. Attending meetings at the Dutch NCA, within the
university and discussions with fellow students were another valuable source of information. Experts and relevant actors were also directly approached with a request for information. The Bundeskartellamt in Bonn, local German competition authorities, Professor Aicher of the University of Vienna and the Dutch Ministry of Economic Affairs are among them. In June the Ministry invited me to come and meet them in The Hague where we were able to discuss the Dutch practices more in depth.
The criteria on which the selection of sources was based ranged from date of publication, language, background of the authors and the specific topic. Many resources seemed relevant in the first place, but later on it proved that they went into a whole other direction. An example is the literature focusing on the abuse of dominance and the environment or state aid.
April 2016); --‘‘Chicken of tomorrow’ falls foul of Dutch anti-cartel rules’ DutchNews.nl
<http://www.dutchnews.nl/news/archives/2015/01/chicken-of-tomorrow-falls-foul-of-dutch-anti-cartel-rules/> (18 April 2016). For academic articles see: R Wesseling and J Truijens Martinez ‘Kroniek van het
mededingingsrecht’ (2015) 90 Nederlands Juristenblad 1006 (Wesseling 2015); MP Schinkel and L Toth ‘Balancing the Public Interest-Defense in Cartel Offenses’ (2016) Amsterdam Law School Legal Studies Research Paper (Schinkel/Toth 2016).
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2. European Union
2.1. IntroductionAll the national competition laws are based on the relevant articles from the TFEU, the regulations, directives, guidelines and notices set by the EU and more specific the Commission. It is nearly impossible for an NCA to find its own way. The only room for maneuver they have is to set their priorities differently. Setting these priorities is exactly what happens in the field of the environment and competition law. This chapter gives a clear picture of how the EU deals with environmental agreements under article 101 TFEU. The general objective to take non-economic goals into account in competition law has taken ground within the EU institutions. Thus far the Commission is somewhat reluctant, but the Parliament and the Council have expressed their point of view on several occasions.9 In essence the situation is as follows: The Parliament and the Council are in favor of taking public policy aspects into account under article 101 TFEU, the Commission follows a different line and focusses only on consumer welfare.10 In the cases GlaxoSmithKline (GSK) and T-Mobile the European Court of Justice (the Court) has rejected the sole focus on
consumer welfare, the structure of the market is just as important according to the Court.11 GSK is a pharmaceutical company that changed its sales conditions regarding resales in other EU Member States. By doing this parallel trade is restricted.12 In T-Mobile Dutch telecom operators discussed the reduction of standard dealer remunerations for postpaid subscriptions. The predecessor of the ACM, Nederlandse Mededingingsautoriteit (NMa), decided that this is a concerted practice under Dutch and EU competition law.13
2.2. Overview of the EU’s practices
Starting point for every agreement to be assessed under EU competition law is article 101 TFEU. The introduction to this thesis has provided for a short explanation of the contents of
9 C Townley Which goals count in Article 101 TFEU? Public policy and its discontents: the OFT's
roundtable discussion on article 101(3) of the Treaty on the Functioning of the European Union (2011) 32 European Competition Law Review 441 (Townley 2011) 442.
10 Townley 2011 (n9) 442.
11 Joined cases C-501/06 P, C-513/06 P, C-515/06 P and C-519/06 P GlaxoSmithKline [2009]
ECLI:EU:C:2009:610 (GSK) par. 63; Case C-8/08 T-Mobile Netherlands [2009] ECLI:EU:C:2009:343 (T-Mobile) par.38.
12 GSK (n11) par.59. 13 T-Mobile (n11) par.13-15.
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the article. There are two options for undertakings to escape fines. Either the agreement does not fall under article 101(1) TFEU or the agreement does fall under article 101(1), but can be exempted under article 101(3) TFEU.
2.2.1. Environmental agreements on the basis of 101(1)
The most famous cases with regard to an agreement between competitors not falling under article 101(1) TFEU are Wouters and Meca Medina.14 In Wouters a regulation of ‘the bar’
which prohibited a partnership between lawyers and accountants did not fell under article 101(1) TFEU because of the overarching goals of the regulation (e.g. protecting the independent position of lawyers and their professional secrecy is a legitimate goal).15 This decision of the Court has introduced the inherent restrictions doctrine. This doctrine seems to contain a proportionality test within article 101(1). It cannot be traced back to any treaty article. Advocate General (AG) Léger clearly disagrees with the Court in its opinion that was published before the Courts decision.16 According to the AG, it goes against the treaty structure to take into account public interest elements under article 101(1) TFEU.17 While there might not be a whole bunch of case law on the doctrine, Wouters proved not to be incidental.18
In Meca-Medina the Court also had a look at the overarching goal of the anti-doping regulation of the International Olympic Comity (IOC) and concluded that it fell outside article 101(1) TFEU.19 The reason why these cases are of any interest for environmental agreements is that Wouters and Meca Medina were decided not to fall under article 101(1) TFEU on the basis of non-economic grounds.20 In Wouters the anti-competitive decision to oblige lawyers and accountants to register with the bar was inherent to the “proper practice of the legal profession”.21 In Meca Medina the Court acknowledged that sports do have an economic implication and the decision of the IOC had as its overarching goal a competitive
14 Case C-309/99 Wouters [2002] ECLI:EU:C:2002:98 (Wouters); Case C-519/04 P Meca-Medina [2006]
ECLI:EU:C:2006:492 (Meca-Medina).
15 Wouters (n14) par.105-110.
16 Opinion of Mr Advocate General Léger delivered on 10 July 2001 Wouters [2001] ECLI:EU:C:2001:390 (AG
Wouters).
17 Ibid. par.107.
18 A Gebrandy De Kip als symptoom (2015) 18 Markt en Mededinging 214 (Gerbrandy 2015) 215. See also
Wouters (n14).
19 Meca-Medina (n14) par.43-45.
20 Although there is some discussion about this point of view. T Heremans Professional services in the EU
internal market: Quality regulation and self-regulation (Hart Publishing Ltd. Oxford 2012) Chapter 2; AJ Vossestein Case C-35/99, Arduino, judgment of 19 February 2000, Full Court; Case C-309/99, Wouters et al. v. Algemene Raad van de Nederlandse Orde van Advocaten, judgment of 19 February 2002, Full Court; not yet reported (2002) 39 Common Market Law Review 841, 859.
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and fair sporting environment that would provide equal chances, safeguard athlete’s health and protect the integrity and ethical values in sports.22
A case on environmental agreements in which the inherent restriction argument was used, has not risen yet. Few cases on inherent restrictions in general and none on environmental
agreements and inherent restrictions means only a few precedents (e.g. Wouters and Meca
Medina). Therefore views are expressed that one should be very cautious to apply the
inherent restrictions doctrine to environmental agreements.23 Following the test laid down by
the Court in Wouters shows that there is some room within the necessity requirement as a part of the proportionality test under 101(1) TFEU. A cartel cover-up is per definition prohibited, but how about a situation in which legitimate environmental goals can be reached without the cartel agreement, but when it is simply faster/more efficient to cooperate?24
2.2.2. Environmental agreements on the basis of 101(3)
There are numerous cases decided on the basis of the exemption criteria from article 101(3) TFEU. One could argue that this is the way to go for undertakings if they want to escape fines imposed on them by the Competition authorities. The four criteria of 101(3) are: The agreement must create economic efficiencies (1), a fair share of the benefits is passed on to consumers (2), indispensability/necessity (3) and there must be sufficient competition left on the market (4).
The assessment of environmental agreements under 101(3) used to start with the Horizontal Guidelines of the Commission from 2001. 25 These guidelines were replaced in 2011.26 The definition of an environmental agreement is as follows according to the guidelines from 2001:
“those [agreements] by which the parties undertake to achieve pollution abatement, as defined in environmental law, or environmental objectives, in particular, those set out in Article 174 of the Treaty [article 191 TFEU]. [...] This excludes agreements that trigger pollution abatement as a by-product of other measures.”27
22 Meca-Medina (n14) par.43.
23 JW van de Gronden en KJM Mortelmans ‘Het mededingingsrecht en niet economische belangen: 2003 het
cruciale jaar?’ in JW van de Gronden en KJM Mortelmans (eds) Mededinging en niet economische belangen (Kluwer Deventer 2001).
24 Gerbrandy 2015 (n18) 215. 25 Horizontal Guidelines 2001 (n5). 26 Horizontal Guidelines 2011 (n6). 27 Horizontal Guidelines 2001 (n5) par.179.
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According to this quotation an environmental agreement is only allowed when its main goal is to benefit the environment. This makes agreements, of which the positive effects for the environment are only a side effect, illegal. In the Horizontal Guidelines of 2010 the section on environmental agreements has disappeared. Instead a section on standardization
agreements was included, of which environmental agreements form a part. According to the Commission the removal of the chapter on environmental agreements does not make them less important. The section on standardization makes the assessment of environmental agreements equal to other types of agreements and so equally important.28 The removal of
environmental agreements can be seen as symbolic for the economic approach of the Commission.
In the BBC Brown Boveri (BBC) case from 198829, the Commission exempted an agreement between a German and a Japanese company with regard to the development of more energy efficient batteries. They agreed not to cooperate with other competitors and to split up the world market. Besides technological development, the agreement would significantly benefit the environment when the batteries would for example be used in electric cars. This means that the quality of life will improve as electric cars do not cause harmful emissions.30 To make of this statement an economic efficiency argument, the Commission very creatively states that the new batteries would generate a more efficient use of power stations, which eventually will result in lower prices for consumers.31 Therefore the Commission reached the conclusion that the agreement could be exempted under article 85(3) EEC (now article 101(3) TFEU).
In the Exxon/Shell case companies that are part of the Exxon holding and the Shell holding cooperate in the production of a certain foil.32 They run a foil-plant together that uses a new technique whereby foil with the same thickness is stronger and more solid. The new
production process reduces the use of raw materials and results in less residual products. The cooperation also reduces transport which lowers the risk of public health problems and environmental damages. In the end the whole process would create cost savings. Lower production costs can be used to reduce the price for the final consumer. A remarkable
28 OECD Horizontal Agreements in the Environmental Context (24 November 2011) DAF/COMP(2010)39
(OECD Roundtable environmental context 2010) 123.
29 Commission Decision of 11 October 1988 (Case IV/32.368) [1988] 88/541/EEC OJ L301/68 (BBC Brown
Boveri).
30 Ibid. par.23. 31 Ibid. par.24.
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argument of the Commission is that the idea alone of the non-economic benefits set out above can be perceived by the consumer as something positive and thereby increases its welfare.33 It seems however that the non-economic arguments were only made by the Commission
because there is also an economic benefit for the consumer.34 So contrary to BBC, the Commission more easily accepts that the environment can play an important role in reaching a decision.
The same applies to the CECED-I case.35 Here an agreement between washing machine producers was exempted under article 101(3) TFEU, not only on the basis of lower energy costs for consumers, but also on the basis of lower CO2 emissions.36 The benefits of lower CO2 emissions got a place under the first criterion of article 101(3), economic efficiencies. After individual benefits for the consumer were established, also collective benefits of lower CO2 emission were recognized.37 CECED-I seems to be the first case in which environmental benefits for consumers were taken just as seriously in the Commission’s assessment as
economic benefits. In the CECED-II case from 2001, about dishwashers and water heaters, an agreement between undertakings to only produce energy efficient appliances was exempted on the basis of article 101(3).38 In the press release of the Commission first the cost savings for consumers are mentioned and “moreover” the agreements can also contribute to the EU environmental objectives.39 The use of “moreover” already downgrades the environmental part of the argument a bit.
Today CECED-I is used as an example in the Horizontal Guidelines of 2011.40 In this example no reference is made to the environmental benefits brought about by the CECED-I agreement. Only the economic benefits for consumers are mentioned. This apparent
diminishing interest of the Commission in the environment as en element of competition law brings about a point of critique, namely does the Commission see a role at all for the
environment within competition law?
33 Ibid. par.71.
34 Breuer 2013 (n 3) 337.
35 Commission Decision of 24 January 1999 (Case IV.F.1/36.718) [1999] OJ L187/47 (CECED-I). 36 Ibid. par.52.
37 Ibid. par.48, 55.
38 European Commission Commission approves agreements to reduce energy consumption of dishwashers and
water heaters Press Release, IP/01/1659 (26 November 2001) (Press Release CECEDII).
39 Ibid.
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In the special case on the Duales System Deutschland (DSD)41 the Commissions concern was the “spaghetti” of contracts that made the DSD waste collecting system to work.42 Instead of
collecting the packaging waste themselves, the undertakings paid a fee to DSD and exempted themselves from the take-back obligation under the German Packaging Ordinance.43 Local waste collecting undertakings can only work in a certain area. The moment a waste collector operates in a certain area DSD refuses to let other undertakings operate in that area. Still, in theory, waste collectors may work for another company like DSD. In practice this is
impossible, because DSD covers the whole of Germany. According to the Commission, access to the market is hereby heavily restricted. DSD fulfilled all the four cumulative criteria of 101(3) for agreements lasting till the end of 2003.44 Newer exclusivity agreements with a duration exceeding 31 December 2003 are not deemed necessary and therefore do not fulfill the criteria of article 101(3).45
The cases described above all pay attention to the welfare of the individual final consumer. Benefits for the society as a whole (environmental benefits) are a welcome addition in the argumentation, but without benefits ending up at the individual consumer no agreement will be exempted under article 101(3) by the Commission. In Wouters and Meca Medina, both based on 101(1), and the five cases discussed above on 101(3), the agreement or the decision by the association of undertakings was upheld in the end. The next few cases will show that there are also agreements prohibited by the Commission because of insufficient benefits for individual consumers. Benefits created by the agreement must be passed on to consumers. If not, than the agreement cannot be exempted under article 101(3) TFEU.
First, the ANSEAU-NAVEWA case from 1981.46 Producers of washing machines and dishwashers agreed with the water suppliers in Belgium to create a certificate that would show that the machines could lawfully be connected to the drinking water system.47 The said
goal of the agreement was to protect the environment and the water quality. However side effects of the agreement such as hindering parallel imports and discriminating sole importers
41 Commission Decision of 17 September 2001 (Case COMP D3/34493 and others) [2001] 2001/837/EC OJ
L166/1 (DSD Commission).
42 Breuer 2013 (n3) 363.
43 Verpackungsverordnung vom 21. August 1998 (BGBl.IS.2379), (Last changed by article1 of the Verordnung
from 17 July 2014 (BGBl.IS.1061) (VerpackV).
44 DSD Commission (n41) par. 146 (efficiencies), 149 (fair share to consumers), 156-157 (indispensability, with
the condition that only agreements running up until 31 December 2013 are indispensable), 163 (elimination of competition).
45 Ibid. par.157.
46 Commission Decision of 17 December 1981 (Case IV/29.995) [1981] OJ L167/39 (NAVEWA-ANSEAU). 47 Ibid. par.6.
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made the agreement to be prohibited per se. No exemption under article 101(3) TFEU is therefore possible.48 Some see this as a clear step of the Commission towards a purely economic based approach of competition law.49 The Commission decision was upheld on appeal.50
Secondly, there is the Consumer Detergents case.51 Several producers of laundry detergents
agreed with each other to start a campaign that would make consumers more aware of how to use laundry detergents. This awareness should eventually result in a more sustainable
consumption of laundry detergents.52 Besides working on a more sustainable sector, also
arrangements were made on the size and amount of packed laundry detergents.53 While there is an element within the agreement that benefits the environment, this does not weigh up against the type of anticompetitive behavior of the cartel members. The sole aim of the agreement, according to the Commission, is the restriction of competition.54
As becomes clear of the selection of cases discussed above, most of them are relatively old. The past few years the activism of the Commission in the field of environmental agreements and article 101 TFEU has declined. An important reason is the abolishment of the notification system that existed under article 4 of Regulation 17/62.55 Regulation 1/2003 lightened the burden for the Commission, because now undertakings had to prove themselves that the cumulative criteria of article 101(3) could be met.56 A second reason could be a change of mind of the Commission. Self-regulation could probably be part of this new mindset.
2.2.3. Self-regulation
At the European level a distinction can be made between two types of environmental agreements. The distinction has been made by the Directorate General Environment (DG Environment). First there are environmental agreements that find their basis in self-regulation of the respective industry. Secondly, there is the type of co-regulation. In the second category both the industry and the authorities sit around the table and come up with a regulation,
48 Ibid. par.63.
49 Breuer 2013 (n3) 326.
50 Joined cases 96-102, 104, 105, 108 and 110/82 ANSEAU-NAVEWA [1983] ECLI:EU:C:1983:310. 51 Commission Decision of 13.4.2011 (Case COMP/39579) [2011] C(2011) 2528 final (Consumer Detergents). 52 Ibid. par.20.
53 Ibid. par.25. 54 Ibid. par.53.
55 EEC Council: Regulation No 17: First Regulation implementing Articles 85 and 86 of the Treaty [1962] OJ
13/204 (Regulation No 17).
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which the industry should comply with.57 Another form of self-regulation will be introduced in the chapter on the BKartA, namely the regulated self-regulation. This type would neither fit in the category of self-regulation, nor in the category of co-regulation.
In the situation of co-regulation, a logic argument of the undertakings is the state-action defense. In the Reiff case this plays an important role.58 In this case the Court had to decide on suggested transport tariffs by the tariff commission. All stakeholders were represented in this tariff commission and eventually the Italian government approved the tariffs. The way how this transport tariff came about is approved by the Court in its decision.59 Due to the
approval of the Italian government, the alleged distortion of competition is deemed legal in
Reiff. Still, according to the Commission this type of defense should be narrowly interpreted.
If a narrow interpretation is accepted, the agreement does not fall under article 101(1)
TFEU,60 on the basis that such an agreement is not an agreement in the sense of article 101(1) TFEU.61
With regard to all the self-regulative activities between undertakings, it is important to realize that it is not only the top down approach which makes undertakings to take environmental issues into account in their corporate behavior. There is also a strong bottom-up pressure coming from the consumers.62 An interesting thought in this regard is that if undertakings are encouraged by the market to conclude environmental agreements the environmental
friendliness of their products may become a competitive parameter, just like price and quality aspects of a product.63 When the Commission would actively fight against certain agreements it is a matter of fair competition on the basis of purely economic grounds vs. private
initiatives to produce ‘greener’ and more environmentally friendly products. Choosing either one has its pros and cons. However what stands out is that undertakings might refrain from
57 S Kingston Greening EU Competition Law and Policy (Cambridge University Press New York 2012)
(Kingston 2012) 226-227; Communication from the Commission to the European Parliament, The Council, The Economic and Social Committee and the Committee of the Regions: Environmental Agreements at Community Level Within the Framework of the Action Plan on the Simplification and Improvement of the Regulatory Environment COM(2002) 412 final (17 July 2002) (Communication 2002) 12-13.
58 Case C-185/91 Reiff [1993] ECLI:EU:C:1993:886 (Reiff). 59 Ibid. par.24.
60 Horizontal Guidelines 2010 (n6) par.22. 61 Reiff (n58) par.24.
62 KM Reynisson Environmentally Beneficial Agreements and Article 101(3) TFEU: Are Non-Economic
Benefits an Option? (2014) 25 European Business Law Review 727 (Reynisson 2014), 730.
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taking environmental friendly initiatives all together, out of fear for being punished under the competition rules and because of the legal uncertainty.64
2.2.4. The Environment as an overall EU objective
Instead of assessing cases on a case by case basis or encouraging self-regulation that deals with environmental agreements under competition law, a more Treaty based incorporation of environmental agreements within competition law is frequently brought forward by
academics as an alternative.65 Arguments for this point of view are sought in the general
objectives and principles of the EU. The European Treaties are designed in such a way that the several fields of law do not come into conflict with each other. In the end the EU is one entity that encompasses a wide variety of rules in several fields of law. In case of a conflict the conflicting provisions should be interpreted in such a way that they at least do not hinder each other, or even better complement each other.66
Treaty based incorporation of the environment is one of the possibilities to deal with
environmental agreements under competition law without too much hassle. What it means is that the articles 3 TEU, 7 TFEU and 11 TFEU form a framework that allows environmental agreements to be interpreted and possibly exempted under the competition rules. Protecting and improving the environment in the process of establishing the internal market is one of the goals of article 3(3) TEU. Article 7 TFEU ensures the consistency between the EU’s policies. These two articles together require taking environmental goals into account under
competition law. The internal market includes the competition rules (Protocol No. 27 on the Internal Market and Competition).67 Article 11 TFEU is the integration article and ensures that the protection of the environment is integrated in the definitions and implementation of EU policies.
The earlier discussed approach of Wouters and Meca-Medina seems to be consistent with article 11 TFEU. While the Commission does not want to take other interests into account under 101(3) besides economic ones, even when these interests are pursued by European law68, instead the balancing can take place under 101(1) TFEU. Taking into account article 11 TFEU when deciding whether a case is covered by article 101(1) TFEU can mean that
64 Reynisson 2014 (n62) 731.
65 Kingston 2012 (n57); I Lianos Some Reflections on the Question of the Goals of EU Competition Law [2013]
(3) CLES Working Paper Series.
66 Kingston 2012 (n57) 97. 67 Kingston 2012 (n57) 101.
68 Communication from the Commission — Notice — Guidelines on the application of Article 81(3) of the
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also environmental agreements are not falling under 101(1), just like rules relating to the protection of the legal profession in Wouters.69
Competition rules cannot escape the logic of the Treaty framework. Still, the Commission today holds on to consumer welfare (seen from an economic point of view) and, forced by the
GSK and T-Mobile judgement, the structure of the market.70 Following the line of reasoning under the articles 3 TEU and 7 and 11 TFEU, a weighing exercise should be carried out. Environmental concerns can be given more weight because they have a legal basis in the treaty framework. This does not imply a standard exemption for environmental agreements; competition concerns can still outweigh the benefits flowing from an environmental
agreement.
Making the environment an element in the calculation of the effects on consumer welfare is complicated. Leaving the environment out of the assessment makes it a lot easier and clear cut. Doing this is against the principles of many economists who apply a broad welfare concept. A broad welfare concept includes non-economic aspects. The ongoing discussion between economists and lawyers mainly focusses on the broadness of the welfare concept. Besides the matter of how to calculate consumer welfare it is also a matter of competence. Many times it is not within the mandate of competition authorities do deal with non-economic interests.71
In sum all the actors agree that consumer welfare is among the goals of competition law. Only the way how consumer welfare is interpreted differs. Economic aspects are easier to implement than issues like the environment, still within practicing law in a broader sense one cannot deny that also many non-economic aspects play a role.72 In competition law a broader notion of consumers is used than within consumer law. This means that the protection of consumers is also different. By not using a narrow consumer definition, competition law can be used more effectively.73
69 S Kingston ‘Should environmental goals have any relevance in competition policy?’ in P Lowe and M
Marquis (eds) European competition law annual 2012: competition, regulation and public policies (Hart Publishing Oxford/Portland 2014) 124-125.
70 GSK and T-Mobile (n11).
71 S Lavrijssen What role for national competition authorities in protecting non-competition interests after
Lisbon? (2010) 35 European Law Review 636 (Lavrijssen 2010) 640.
72 K Cseres The Controversies of the Consumer Welfare Standard (2007) 3 The Competition Law Review 121
(Cseres 2007) 130.
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Besides the Treaty-framework argument set out above, there is according to Kingston also a good governance and an economic argument in favor of incorporating the environment in competition policies that should be made.74 The good governance argument is about maintaining consistency between EU policies. Consistent policies make the EU a more reliable regulator.75 Secondly there is the economic argument. To understand the economic
argument it suffices to mention that the starting point can be two-sided. Namely quantifying environmental benefits and/or quantifying environmental harm.76 Trying to find out what will
happen when the environmental agreement will not be allowed offers a solid basis for making this calculation.
2.3. Conclusion
The first step in answering the research question is deciding whether there is room at the EU level for a bottom-up request by the Member States for providing more explanation on
environmental agreements under EU competition law. The Commission seems to hold on to a strict economic approach and a narrow interpretation of consumer welfare. By consistently seeking for an economic aspect in every case where undertakings try to justify an unlawful agreement under article 101(1) TFEU, the Commission chooses to downgrade other (non-economic) arguments, such as the environment, to the level of supportive arguments. While this Commission practice can be seen in many cases from quite some time ago, it is hard to tell how the Commission would decide on the issue today. Times have changed and the environment is something which is more and more taken into account by consumers when buying products and by undertakings in their production process.
If the Commission adheres to the requests for giving the environment a place under article 101 TFEU it has four options. First, it can follow the approach in Wouters and Meca Medina. However not everyone can find themselves in such a new role of article 101(1). Coupling the inherent restrictions doctrine to article 11 TFEU would allow for a balancing exercise under 101(1) TFEU instead of 101(3). Secondly, broadening the definition of consumer welfare and hereby make it easier to exempt the environmental agreement on the basis of 101(3). Thirdly, offering more guidance and possibly even get actively involved in self-regulative initiatives
74 Kingston 2012 (n57) Chapters 3-5. See also the following article: S Kingston Integrating Environmental
Protection and EU Competition Law: Why Competition Isn’t Special (2010) 16 European Law Journal 780 (Kingston 2010) Part II.
75 Kingston 2010 (n74) 794-795. 76 Ibid. 800.
17
taken by the industries. Lastly, interpret European competition rules in the light of the Treaty framework.
Based on the existing case-law one could rightly state that the environment does play a role in the assessment methods of the Commission. The only problem is that it should be taken to a next level at which the environment can function as a stand-alone argument. Whether the Dutch and German NCA support this point of view is the topic of the next two chapters.
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3. The Netherlands
3.1. IntroductionIn the Netherlands several supermarkets agreed on only selling meat from chickens that had a (slightly) better life than the meat from chickens they used to sell.77 The conclusion of the ACM’s analysis on this agreement was that it is not allowed for supermarkets to collectively decide not to sell chicken meat anymore of chickens that lived under very poor conditions (the ‘exploding chicken’78). According to the ACM, the benefits for consumers were not
going far enough and the improvement of animal welfare did not outweigh the extra costs consumers had to pay.79 A parallel can be drawn with arguments to justify an
anti-competitive agreement on the basis of benefits for the environment. Just like improving animal welfare, improvement of the environment is something that can be beneficial for consumers. Both are in the Netherlands seen as relevant to the public interest.80
It is difficult to put a price tag on animal welfare, the environment or other non-economic issues relevant to competition law cases. The ACM has had many opportunities to show its thinking on the issue of environmental agreements under section 6(1) of the Mededingingswet (Dutch competition law, Mw).81 Section 6 Mw is the Dutch equivalent of article 101 TFEU.
3.2. Overview of the ACM’s practice
Since 1998 the ACM (and its predecessor the NMa) has been actively involved in the area of sustainability and competition law. Many (non-)binding decisions have been taken on this issue and in a significant number of cases the ACM pays attention to the arguments relating to the environment.82 Environmental agreements are not mentioned in the Mw itself (nor are
they in the TFEU). Where the Commission today is not active in the field of competition law and the environment, the Dutch Ministry of Economic Affairs (Ministry) has a strong opinion
77 Chicken of Tomorrow 2015 (n7). 78 Schinkel/Toth 2016 (n8) 4. 79 Chicken of Tomorrow (n7) 6.
80 The environment is recognized as a public interest in EU law, article 3 TEU and Protocol No. 27 on the
Internal Market and Competition. Animal welfare is a public interest with regard to public debate and the representation by an “animal party” in Dutch parliament; Chicken of Tomorrow (n7) 2. Note in particular the mentioned “Treaty of Den Bosch” and the “Different Meat 2020” initiative.
81 Last changed by the law of 25 June 2014, Stb. 2014, 247.
82 For an overview of these cases see: --‘Relevante besluiten van de EC en de NMa’ ACM
<https://www.acm.nl/nl/onderwerpen/concurrentie-en-marktwerking/duurzaamheid-en-mededinging/relevante-besluiten-rondom-duurzaamheid-en-mededinging-van-de-ec-en-de-nma/> (18 April 2016).
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on this topic. This opinion is expressed in the Policy Rule on competition and sustainability (Policy Rule) and the ACM’s vision document.
3.2.1. The role of the Policy Rule
One of the main arguments of the ACM to prohibit the agreement between supermarkets in
the Chicken of Tomorrow is that consumers were willing to pay more for chicken filet of
chickens that had a better life, but less than what would have been required. So consumers would be worse off because the price for chicken is higher than their willingness to pay.83
The Ministry preferred to have seen a different outcome and put part of the blame on the Policy Rule.84 In Dutch politics plans were immediately made for a new Policy Rule (Draft Policy Rule).85
On 23 June 2016 the Minister of Economic Affairs (the Minister) sent a letter to the Dutch Parliament explaining what will be changed and what the view of the ACM and the
Commission is on the Draft Policy Rule.86 The goal of the new Policy Rule is providing more clarity to undertakings that want to develop societal initiatives within the boundaries of competition law. By doing this these societal initiatives get more room and can contribute to sustainability.87 A Policy Rule is a non-binding directive that does not need a legal basis in Dutch law. The most important elements of the Policy Rule are:
First, the criteria of section 6(3) Mw and in particular the definition of consumer welfare and the indispensability requirement are explained in more detail. The Policy Rule states that passing on the benefits to consumers can also encompass an improvement of consumer welfare in the long run.88 The Commission disagrees and advocates a definition of consumer welfare limited to the individual consumer.89
83 Chicken of Tomorrow 2015 (n7) 6.
84 Besluit van de Minister van Economische Zaken van 6 mei 2014, houdende beleidsregel inzake de toepassing
door de Autoriteit Consument en Markt van artikel 6, derde lid, van de Mededingingswet bij
mededingingsbeperkende afspraken die zijn gemaakt ten behoeve van duurzaamheid, Stcrt 2014, 13375 (Policy Rule). Also available in English.
85 Consultatieversie Beleidsregel mededinging en duurzaamheid van 23 december 2015, not yet published (Draft
Policy Rule). Pdf file in Dutch is available at:
<https://www.internetconsultatie.nl/mededingingenduurzaamheid> (19 April 2016).
86 HGJ Kamp Mededinging en Duurzaamheid Letter to the Speaker of the House of Representative of the State
General (Tweede Kamer) (23 June 2016) DGETM-MC / 16071609 (Letter Kamp 2016).
87 Ibid. (n86).
88 Policy Rule (n84) 10.
89 J Laitenberger Letter to the Secretary General of the Ministry of Economic Affairs, Mr. Camps (26 February
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In the ACM’s analysis on the planned closure of five coal power plants an attempt is made by the ACM to quantify the reduction in air pollution.90 Dutch energy companies wanted to close certain coal power plants earlier than was foreseen under the Energy Accord concluded in the Netherlands. The Energy Accord wants to make the supply of energy more sustainable. A clear cut method to quantify the monetary value of effects on sustainability and in
particular the environment is not yet available. According to the energy companies, closing coal power plants prematurely would fit in the broader picture of today’s policy to reduce pollution and increase sustainability. The ACM quantified the reduction of polluting substances in monetary terms. It also quantified the rise in electricity costs for the final consumers. The reduction of air pollution did not weigh up against the costs for consumers. One of the options to quantify the environment in economic terms is the ‘willingness to pay’ (WTP) method. In a guidance of the Dutch Centraal Planbureau (CPB) is stated that the WTP shows what the highest price someone is willing to pay for the positive effects of goods and services is. Hereby the net benefits should outweigh the net costs. However, it is nearly impossible to put a price tag on the environment.91 The WTP method has some
disadvantages. Is the group of consumers interviewed representative? Did they gave their real WTP for a certain product or would they act differently in practice? How are the collected data analyzed? Another problem is that not all the benefits resulting from an environmental friendly agreement between competitors will end up at the final consumers (or their
descendants).92
Letting the consumer benefit from environmental agreements can also be achieved in a different way. Open and transparent negotiations between undertakings in which the general public can take part, will make that the consumer is able to express their views. In the
Netherlands public authorities are often a party in the process of self-regulation. This goes as far that even the parliament can intervene in certain agreements.93 When the consumer
agrees, it apparently sees a benefit for himself. In the Netherlands this has been tried several times.94 In theory this might sound as a success, in practice it can also delay or complicate the
90 Analyse van de Autoriteit Consument en Markt met betrekking tot de voorgenomen afspraak tot sluiting van
80er jaren kolencentrales in het kader van het SER Energieakkoord [2013] no case number (closure coal power plants) 3.
91 G Romeijn and G Rennes Algemene leidraad voor maatschappelijke kosten-batenanalyse (CPB PBL Den
Haag 2013) (Romeijn 2013) 13-14.
92 Draft Policy Rule (n85) 11.
93 E Rehbinder Environmental Agreements a New Instrument of Environmental Policy (1997) 27 Environmental
Policy and Law 258 (Rehbinder 1997), 261-262.
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negotiation process. Ex-post controls with the help of competition law might be more efficient in the end. Still public participation is possible in the form of a monitoring body.95 Looking if the undertaking is losing market share or profits under the
indispensability/necessity criterion should also be part of the analysis according to the Policy Rule.96 A case in which the necessity criterion was not fulfilled is the MSC Shrimp Fisheries case. In an informal opinion the NMa states that the new management plan of the shrimp sector (management plan) only partly has an anti-competitive effect which cannot be
exempted from section 6(1) Mw.97 On the one hand, the part of the management plan on new
fishing techniques falls under section 6(1) Mw, but could possibly be exempted under section 6(3) Mw. According to the NMa the new fishing techniques could be less harmful to the environment by saving fuel and a smaller effect on the seabed.98 On the other hand, the part of the management plan which imposes fishing restrictions on the fishers is a restriction of competition that cannot be exempted under section 6(3) Mw. Assessing whether protecting the shrimp population by imposing fishing restrictions will outweigh the costs is only possible after more research has been done.99 The Shrimps case proofs that sustainability initiatives are not per definition ignored, even before the implementation of the Policy Rule. Secondly, the Draft Policy Rule pays attention to the inherent restriction doctrine.
Unfortunately it is rather vague on this issue and states that the legal status of environmental agreements and the doctrine is unclear.100 More guidance on how environmental agreements can escape prosecution under section 6(1) Mw has been asked for in the consultation round of the Draft Policy Rule.101 Cases in which the ACM had the opportunity to create jurisprudence on the issue of inherent restrictions, but did not, are the Stichting Wit- en Bruingoed (SWB)102
95 Ibid. 267.
96 Policy Rule (n84) 12.
97 Informele zienswijze Managementplan MSC Garnalenvisserij [2011] 7011/23.B27 (MSC Shrimp fisheries). 98 Ibid. 6.
99 Ibid. 7.
100 Draft Policy Rule (n85) p.5.
101 KJ Osinga, V Triebert (LTO Nederland) and J Fanooy, T Raats (Barents Krans NV) Consultation Draft
Policy Rule, 31 January 2016 par 19-20 TS (Osinga 2016); MG Bos (Secretariat SER) Consultation Draft Policy Rule, 26 January 2016 TS (Bos 2016) 5; MMR Feith (FNLI) Consultation Draft Policy Rule, 29 January 2016 TS par. 2.2-2.4 (Feith 2016); RG van den Berg (Secretariat Nederlandse Orde van Advocaten) Consultation Draft Policy Rule, 29 January 2016 TS 4 (van den Berg 2016). Available at: <
https://www.internetconsultatie.nl/mededingingenduurzaamheid/reacties/datum> (3 May 2016).
102 Besluit van de directeur-generaal van de Nederlandse mededingingsautoriteit tot gedeeltelijke toewijzing en
gedeeltelijke afwijzing van een aanvraag om ontheffing als bedoeld in artikel 17 van de Mededingingswet [2001] 1153/ (Stichting wit- en bruingoed).
22
and Stichting Papierrecycling Nederland (SPN)103. Both cases are decided under the old
competition regime in the Netherlands.
In SWB two undertakings set up a collection system for household machines. They were required to do this by law. The Minister approved the system under the condition that also the NMa gave its approval. Part of SWB’s agreement obliged the undertakings to pass on a disposal fee to consumers. This limited the competition on the market according to the NMa.104 Economic efficiencies and passing on the benefits to consumers could not be proved
and therefore part of the agreement was prohibited.105 Alternatively it could have been an
option for the NMa to use the Wouters doctrine and see if the disposal fee could be seen as inherent for SWB to fulfill its obligations under Dutch law.
Under Regulation 94/62 Member States are obliged to set up a recycling system. This is what the Dutch government did and on the basis of the national legislation SPN set up a recycling system. Part of the agreement that SPN concluded is a waste management contribution for its members. This waste management contribution fell under section 6(1) Mw106; however it fulfilled all four cumulative criteria of section 6(3) Mw and was therefore exempted from section 6(1).107 Just like in SWB the passing on of the fees and the way it was passed on can also be assessed from a section 6(1) perspective. The overarching goal is setting up a
recycling system. It cannot be ruled out that the waste management contribution is inherently related to his goal.
Whether in the case of SWB the agreement would have been allowed when assessed under the inherent restriction doctrine and whether assessing the SPN case under this doctrine would lead to the same result remains unanswered. The NMa opted for an assessment under section 6(3) Mw. It sticks to the idea that section 6(1) (and thereby article 101(1) TFEU) are not meant to function as an “exception article”.
Conflicts with EU law should be avoided at any time. Unofficial meetings between the Ministry of Economic Affairs and the Commission have been held to make sure that the
103 Besluit van de directeur-generaal van de Nederlandse Mededingingsautoriteit tot toewijzing van een
aanvraag als bedoeld in artikel 17 van de Mededingingswet [2003] 3007 / 33.O316 (Stichting Papierrecycling Nederland).
104 Stichting wit- en bruingoed (n102) par.77. 105 Ibid. par.91,93.
106 Stichting papierrecycling Nederland (n103) par.69. 107 Ibid. par.84.
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Policy Rule and Draft Policy Rule comply with European law.108 In a letter from DG Comp to the Ministry109, it becomes clear that the Commission fully supports the idea to allow for a bigger role for undertakings in taking sustainability initiatives. At the same time the
Commission does see the limits now present in competition law.110 According to the Commission the Draft Policy Rule is with regard to some of its provisions in clear conflict with EU law.111 It mentions the fact that a benefit for (final) consumers cannot mean that the benefits can be for the Dutch society as a whole.
The Commission thinks the Draft Policy Rule unfairly criticizes the decision of the ACM in
the coal power plants case.112 Support for the Commission’s points of view can be found in some of the reactions that came out of the consultation round for the new Policy Rule. The most ‘extreme’ reaction comes from Schinkel.113 Schinkel is of the opinion that the Policy
Rule and the Draft Policy Rule do not add anything and should be repealed. An alternative policy instrument would give the Minister the discretionary powers to adopt certain sustainability initiatives as a public measure, in line with the case-law114 of the European Court of Justice.115 Some stakeholders refer in their reactions to a written opinion of Wesseling from 2015.116 Central in Wesseling’s opinion is the Reiff case (discussed in the previous chapter).117 Similar to Reiff a decision of the Minister on an environmental agreement which complies with the conditions of Reiff should also be allowed under competition rules.
Under the surface of giving the Minister more discretionary powers lies the question whether the ACM is the right organization to assess sustainability initiatives. In several media
publications the president of the ACM stated that if the Minister really wants a more lenient attitude of the ACM towards environmental agreements, it should pass new legislation. A complicating factor is that the current Dutch government wants the national industries to
108 Policy Rule (n84) 4 5. 109 Letter Laitenberger 2016 (n89). 110 Ibid. p.1. 111 Ibid. p.2. 112 Ibid. p.3.
113 MP Schinkel (Professor University of Amsterdam) Reaction to Consultation Draft Policy Rule 2016 30
January 2016 TS (Schinkel 2016). Link at n101.
114 With “case-law” the commentators in note 115 mean the Reiff case (n 58) and Arduino, Case C-35/99
Arduino [2002] ECLI:EU:C:2002:97 (Arduino).
115 Osinga 2016 (n101) par.37.
116 R Wesseling ‘‘Polder-Plus’-model: oplossing ‘Kip van Morgen’ ligt niet bij ACM maar bij minister’ (2015)
18 Markt en Mededinging 220.
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regulate itself, with as less involvement of the government as possible.118 While the Minister also sees that sometimes more regulation is simply necessary it assured in its letter to the Dutch Parliament that he will look into how this regulation can best be implemented.119
3.2.2. The role of the Vision Document
The relationship between the Policy Rule and the ACM Vision Document on Competition and
Sustainability (vision document) is that the vision document explains how the Policy Rule
should be implemented in practice.120The vision document explains the best how the ACM
deals with environmental agreements and section 6 Mw/101 TFEU.121 The analysis of
environmental agreements under section 6 Mw happens on a case by case basis.122 The key elements of the vision document are the following:
Sustainability initiatives are assessed within the same framework as other agreements that might be exempted from section 6(1) Mw.123 Sustainability initiatives contribute not only to the welfare of one individual or a group of individuals that finds itself in a certain
geographical area. It also contributes to the welfare of consumers in a neighboring geographical area. Therefore a broad definition of welfare is to be used according to the ACM.124 As became clear from the previous paragraph this is exactly the focal point in the exchange of letters between the Ministry and the Commission.
During the consultation round leading up to the vision document, concerns were expressed on the view of the EU towards all the activity on sustainability and competition in the
Netherlands. The motivation behind this concern is that it seems that the Commission slowly tries to get rid of all references to sustainability in EU documents on article 101 TFEU. The ACM assures in its reaction to the consultation that there have been several meetings with representatives from the Commission and that both parties were on the same page.125 It also
adds that it would welcome stronger EU cooperation in this field and up until the moment
118 A Weissink ‘Mededingingsregels voor Duurzamere Producten Aanpassen is Onnodig’ Financieel Dagblad
(Amsterdam The Netherlands 2 July 2015); T van der Heijden and C Houtekamer ‘Boetes? We Doen Liever Eerst een Wenkbrauwgesprek’ NRC (Amsterdam The Netherlands 11 April 2015). See also: Bruggen slaan – Regeerakkoord VVD – PvdA (20 October 2012) p.41. Here the two parties in the Dutch government agree to limit the number of rules, regulations and laws.
119 Letter Kamp 2016 (n86) p.3-4.
120 E Loozen ‘De onwenselijkheid van de Beleidsregel mededinging en duurzaamheid’ (2015) 100 ESB
Marktordening 746 (Loozen 2015), 746.
121 ACM Vision Document Competition and Sustainability [May 2014] (Vision Document). Also a Dutch
version is available.
122 Ibid. 3. 123 Ibid. 6. 124 Ibid. 7.
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that this cooperation takes shape the ACM continues to apply its vision document. The Commission does not agree with this position of the ACM.126
An environmental agreement can fall outside of the prohibition of section 6(1) Mw when the agreement does not fulfill the requirements (i.e. appreciably restriction of competition and the agreements is inherent to a legitimate public interest). According to the ACM the question whether agreements related to the environment can be cleared because they do not fall under section 6(1) Mw has been insufficiently answered in jurisprudence before.127 The ACM gives
the following cases as an example: Besides the Wouters128 and Meca Medina129 case, also the
OTOC130 case and the CNG131 case were mentioned. OTOC is about permanent education for Portuguese accountants in order to guarantee their quality of services for consumers. This obligation of education was not seen as proportionate to the goal aimed at, namely
guaranteeing a high quality of services.132 Protecting the consumers of geological services by imposing a tariff scheme is the central issue in the CNG case. According to the Court this is in principle a valid goal, however if a tariff scheme proves to be necessary in the process of achieving this goal is something that should be assessed by the national courts.133
An example of a case before the ACM that fell outside section 6(1) Mw is the one before the Court of Rotterdam on the exclusive one-on-one contracts between farmers and veterinarians. The court in Rotterdam upheld the ACM’s decision134 from 2013 on exclusive contracts between veterinarians and farmers.135 Two veterinarians appealed the decision of the ACM arguing that the exclusive contracts would limit competition to such a degree that they form an infringement of section 6(1) Mw. In its decision the ACM mentioned the process of making the livestock sector more sustainable as an important aspect in its decision to allow the exclusive one-on-one contracts.136 The case is an example that the ACM does not per definition ignore sustainability initiatives. Although the exclusive one-on-one contracts did
126 Letter Laitenberger 2016 (n109). See also the annex to his letter with a reaction of the Commission towards
the first Policy Rule from 2014.
127 Vision Document (n121) 10. 128 Wouters (n14).
129 Meca Medina (n14).
130 Case C-1/12 OTOC [2013] ECLI:EU:C:2013:127 (OTOC). 131 Case C-136/12 CNG [2013] ECLI:EU:C:2013:489 (CNG). 132 OTOC (n130) par.98-100.
133 CNG (n131) par.55-56.
134 Besluit van de Autoriteit Consument en Markt tot afwijzing van een aanvraag tot het nemen van een besluit
als bedoeld in artikel 56, eerste lid, van de Mededingingswet. [2013] 2013.205695 (Veterinarian one-on-one 2013).
135 Case ROT 15/1219 verplichte 1-op-1 contracten dierenarts veehouder [2016] ECLI:NL:RBROT:2016:2494
(Veterinarian one-on-one 2016).
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not limit competition on the outset it shows that non-economic goals are part of the assessment method.
The exemption criteria of section 6(3) Mw need to be assessed against an economic
background according to the ACM.137 This means that in the end the benefit resulting from an
environmental agreement should always offset the costs of it. The vision document tries, in addition to the Policy Rule(s) of the Ministry, to provide guidance for undertakings to do a self-assessment on the basis of the section 6(3) criteria. However, the ACM rejects a step-by-step guidance because it first wants to see how the vision document will work out in practice and do up some experience in concrete cases.138 Regarding the fact that the reactions on the ACM’s decision in the Chicken of Tomorrow and coal power plants were at the least not overwhelmingly positive, according to the public opinion the vision document has failed its first test. An alternative would have been to assess the cases under the inherent-restriction doctrine of Wouters and Meca Medina. As stated before, the ACM is of the opinion that there is not enough precedent to provide for guidance on this issue. Still the possibility is not completely ruled out in the future.139
3.3. Conclusion
The Dutch Ministry of Economic Affairs is very active in creating a system where
environmental friendly agreements between competitors are filtered out and can be kept in place. It cannot always count on the cooperation of the ACM. The Policy Rule from 2014 and the Chicken of Tomorrow case that followed it are an example. Still, there are also cases in which benefits to the environment were accepted on the basis of section 6(3) Mw. The
veterinarian one-on-one case and the MSC Shrimp Fisheries are two of these cases. Besides
some cases in which the environment was successfully used as an argument by undertakings, the Ministry wants to provide more clarity to undertakings, so that it gets easier for
undertakings to conclude environmental agreements and thereby contributing to protecting the environment.
The Ministry and ACM are struggling to do this; especially the definition of consumer welfare forms an obstacle. As became clear from the previous chapter, the Commission opts for a narrow interpretation and is of the opinion that environmental benefits that end up to the
137 Vision Document (n121) 11. Also the Commission advocates this economic approach in its Guidelines
101(3) (n68) par.5.
138 Consultation document (n125) 3. 139 Vision document (n121) 10.
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society as a whole cannot be qualified as an economic efficiency under section 6(3) Mw/101(3) TFEU. It has made this once more clear in an exchange of letters with the Ministry. Still the Ministry wants to continue with its efforts to stimulate undertakings to collectively conclude environmental agreements in such a way that it fits in the competition law framework. Instead of the non-binding Policy Rules it wants to provide additional binding legislation, so that it can no longer be ignored by the ACM.
So the position of the Netherlands towards environmental agreements is two-sided. On the one hand, it actively wants to stimulate undertakings to take joint initiatives that help to improve the environment. On the other hand, it does not know how exactly. Moreover because the national competition law needs to comply with European law, but at the European level not much leeway is offered to interpret terms as “consumer welfare” and “economic efficiencies” differently. Even when the Commission would issue guidelines to clarify these principles, it does not necessarily mean that the Commission’s explanations provide the interpretation foreseen by the Ministry.
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4. Germany
4.1. Introduction
The NCA of Germany is called the Bundeskartellamt (BKartA). The BKartA was founded 30 years earlier than the NMa, in 1958. Certain articles of the German Gesetz gegen
Wettbewerbsbeschränkungen (GWB)140 have lost their relevance since the modernization of
the European Competition Law and where omitted from the GWB in 2005. This
modernization started when regulation 1/2003 was introduced and in particular article 3 thereof.141 Besides the BKartA each Bundesland (state) within Germany has its own competition authority. They apply the same laws as the BKartA, but limited to activities within the territory of the state. The activities of the states in the field of sustainability and competition law are negligible and therefore not addressed in this chapter.142
4.2. Overview of the BKartA’s practice
The GWB deals exclusively with cartel law and merger control. Exemptions to §1 GWB are laid down in §2 GWB. §3 GWB is an extra exemption for small and medium sized
enterprises. Sustainability and the environment are of paramount importance in Germany. Germany is seen as a green country and they are known for their green energy initiatives. In 2013 Germany had the largest primary production of green energy within the EU. 17,5% of all the green energy produced in the EU was produced in Germany.143
4.2.1. Situation until 2005
Up until 2005, when the GWB was changed radically, there were more options for
undertakings to be exempted from the cartel prohibition. Knowing how the GWB functioned up until 2005 makes it easier to understand why the BKartA has chosen for the investigation methods it uses today.
140 Gesetz gegen Wettbewerbsbeschränkungen in der Fassung der Bekanntmachung vom 26. Juni 2013,
BGBl.IS.1750,324 (last changed by Article 1 of the Law from 17 February 2016 (BGBlIS.203)).
141 Regulation 1/2003 (n 1) article 3; K Cseres Comparing laws in the enforcement of EU and National
Competition Laws (2010) 3 European Journal of Legal Studies 7 (Cseres 2010) 9; Dr. Ludger Breuer […] (Email Breuer). See the appendix for a copy of the email.
142 The author has sent several emails to almost all competition authorities of the States with a request for
information on this topic. The State competition authorities are not familiar with any case law and refer to the practices of the BKartA. [email addresses omitted from this thesis] See the appendix for a copy of the emails.
143 --‘Renewable energy statistics’ Eurostat
