Short Reads

Dutch Ministry issues Guidelines on Corporate Sustainability Initiatives and Competition Law

Dutch Ministry issues Guidelines on Corporate Sustainability Initiatives and Competition Law

Dutch Ministry issues Guidelines on Corporate Sustainability Initiatives and Competition Law

02.11.2016 NL law

On 5 October 2016, the Dutch Ministry of Economic Affairs published revised policy guidelines and an explanatory note ("Guidelines") applicable to the Netherlands Authority for Consumers and Markets' ("ACM")  assessment of sustainability initiatives between competitors. Examples include initiatives relating to ecological or environmental welfare, and agreements that may benefit public health, animal welfare, and/or fair trade.

The Guidelines introduce specific factors which the ACM must take into account when applying the national equivalent of article 101 (3) TFEU (the exemption provision) to agreements on sustainability, including:

  • Long-term benefits – for society as a whole – that may result from the agreement,
  • Long-term quantitative and qualitative benefits for consumers directly affected by the agreement,
  • First-mover disadvantages that would arise if the initiative was taken by a single firm, and
  • Whether parties to the agreement are able to compete effectively on parameters that remain unaffected by the agreement.

The new Guidelines were adopted to address (perceived) tension between the competition rules and sustainability initiatives. Businesses considered that the ACM's practical application of the competition rules would continue to hamper legitimate cooperation on sustainability. In 2015, for example, the ACM did not approve of a set of agreements aimed at enhancing the animal welfare conditions of chickens sold in Dutch supermarkets [see our February 2015 newsletter article].

Although the Guidelines do not alter the legal criteria enshrined in the exemption provision, guidance is provided on the types of objective benefits and supporting evidence the ACM must consider in its assessment if brought forward by businesses in support of the initiative. For example, when assessing whether objective efficiency gains offset initial consumer harm (e.g. in the form of higher prices or reduced choice) the ACM will have to assess the positive effects that are likely materialize in the long term, including the effects on future generations of consumers. In addition, the ACM will have to consider the effects of the agreement as a whole, as opposed to limiting its assessment to the part of the agreement that may result in negative effects on competition.

In practical terms, the Guidelines offer a number of methodologies than can be used by businesses to support the positive effects of sustainability initiatives. These include using so-called "shadow pricing" to determine the future costs for society that could be avoided by the sustainability initiative. Another suggested method includes quantifying the costs relating to damage sustained by failing to undertake the initiative.

Despite the additional assessment criteria imposed on the ACM by the Guidelines, businesses seeking to cooperate on sustainability will continue to bear the burden of proving that the envisaged agreement meets the exemption criteria. Overall the Guidelines provide useful information that can be used for this purpose, but the exercise will continue to depend of the facts of the case and the scope of the agreement. It remains to be seen whether the Guidelines will materially alter the ACM's critical track record or succeed in cutting red tape for businesses seeking to cooperate on sustainability.

This article was published in the Competition Law Newsletter of November 2016. Other articles in this newsletter:

  1. District Court of Rotterdam annuls 6 fines in the Rotterdam taxi operators cartel case
  2. District Court of The Hague deals with claim reduction by claimant and rules that claimant is responsible for preserving documents

Team

Related news

09.01.2020 NL law
Deleting WhatsApp chats during dawn raids may cost you dearly

Short Reads - Companies should be aware that the Dutch competition authority (ACM) will not only examine electronic records and emails, but can also check WhatsApp messages during dawn raids. The ACM recently imposed a fine of EUR 1.84 million on a company for non-cooperation with a dawn raid; its highest fine so far for non-cooperation. Several of the company’s employees had left WhatsApp groups and deleted chats before handing over their mobile phones for inspection.

Read more

16.01.2020 NL law
De Amsterdamse milieuzone voor brom- en snorfietsen: voertuigen van een bepaald jaar weren is mogelijk bij ontbreken van een redelijk alternatief

Short Reads - ABRvS 20 november 2019, ECLI:NL:RVS:2019:3865 Deze blog is het vierde deel in een reeks Stibbeblogs over gemeentelijke milieuzones. In 2017 oordeelde de Afdeling over de milieuzone voor personen- en bestelauto’s met dieselmotoren in Utrecht. In 2018 presenteerde de staatssecretaris van Infrastructuur en Waterstaat haar beleid voor harmonisatie van uiteenlopende gemeentelijke milieuzones. Een jaar geleden maakten wij in een FAQ de balans op over de harmonisatie van milieuzones.

Read more

09.01.2020 NL law
Access to the file in Dutch competition procedures: too little too late?

Short Reads - Companies beware: the ACM’s and European Commission’s approach to access to the file are not aligned. According to an interim relief judge, the ACM cannot be forced to grant a company access to a broader set of documents in competition procedures. A potential error in the administrative procedure can be remedied before a court at a later stage. This is different to the right to access to the Commission’s file during administrative procedures, as acknowledged in EU case law.

Read more

10.01.2020 NL law
Is het mededingingsrecht de reddingsboei van zwakke zzp’ers?

Articles - Het toenemende aantal zzp'ers heeft ook mededingingsrechtelijke gevolgen. Volgens de ACM werkt de markt namelijk niet goed als zzp'ers door lage uurtarieven onder het bestaansminimum komen. Jan Truijens Martinez en Simone Evans bespreken in het Tijdschrift voor Arbeidsrecht in Context hoe eventuele belemmeringen die het mededingingsrecht opwerpt bij de bescherming van zzp'ers kunnen worden beperkt en of het mededingingsrecht eigenlijk wel het juiste instrument daarvoor is? 

Read more

09.01.2020 NL law
Competition rules and globalisation to face off in 2020

Short Reads - 2020 will likely revolve around the question whether competition rules should yield to globalisation and digitisation, with suggestions ranging from mere tweaks to competition rules to complementary regulation. Greater cooperation across data protection, consumer protection and competition law appears inevitable. Speedier solutions in more informal settings may become a reality, alongside more frequent use of behavioural remedies.

Read more

Our website uses functional cookies for the functioning of the website and analytic cookies that enable us to generate aggregated visitor data. We also use other cookies, such as third party tracking cookies - please indicate whether you agree to the use of these other cookies:

Privacy – en cookieverklaring