Sustainability governs all policies and sectors of social and economic life. The goal of sustainable development is to meet the needs of today’s generations without compromising the self-sufficiency of future generations. Companies are called upon to innovate as economic conditions indicate a change in the direction of sustainability. Sustainability considerations and green developments have increasingly caught the attention of competition law’s enforcers. Competition authorities such as the European Commission (“Commission”), the Hellenic Competition Commission (“HCC”), the Dutch Competition Authority (“ACM”) and the German Competition Authority (“Bka”) have taken a positive stance towards accepting sustainability initiatives proposed by the private sector. How can companies balance both sustainability and competition law? In this blog post, we analyze recent developments that further explain the sustainability framework that companies have to navigate.
The CJEU sets out an analytic framework on exclusionary abuses in the context of market liberalisation
In Enel, a judgment of 12 May 2022 (C-377/20), the Court of Justice of the European Union (“CJEU”) complemented the framework for analysing exclusionary abuses developed in earlier case-law, notably where it applies to a context of market liberalisation:
- Abuse: The concept of “abuse” relates to conduct that departs from “competition on the merits”. Conduct that an equally efficient competitor can replicate is generally not abusive (“equally efficient competitor test”).
- Anti-competitive effects: While it is not necessary to demonstrate actual anti-competitive effects or the company’s intention to carry out an exclusionary strategy, such factors are relevant in assessing whether the conduct is abusive or not.
- Harm: Conduct that harms consumers indirectly as a result of its effect on the structure of the market is per se abusive; it is not required to demonstrate an actual or potential direct harm to consumers.
- Objective justification: The prohibition set out in Article 102 TFEU does not prohibit conduct that is objectively justified and proportionate, or where the behaviour is counterbalanced or outweighed by pro-consumer efficiency-benefits.
The judgment largely endorses the opinion of Advocate General Rantos (see our blog post), but adds some important nuance.
Advocate General Rantos Provides Sound Guidance for Non-Pricing Abuse of Dominance Analysis (Case C-377/20)
On 9 December 2021, Advocate General (“AG”) Rantos delivered his Opinion in Servizio Elettrico Nazionale (Case C‑377/20), a request for a preliminary ruling from the Italian Consiglio di Stato. The case concerns the conduct of the ENEL Group (“ENEL”) in the context of the liberalisation of the electricity market in Italy. ENEL, the incumbent, allegedly used customer data obtained before liberalisation to make offers to customers in order to “transfer” them to its operator active on the liberalised market, seeking to prevent the large-scale departure of customers.
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Amended GBER simplifies State aid rules for projects supporting the recovery from the COVID-19 pandemic
Introduction
On 23 July 2021, the European Commission (“Commission”) adopted an extension of the scope of the General Block Exemption Regulation (“GBER”). The revised rules concern:
- Aid for projects funded via certain EU centrally managed programmes under the new Multiannual Financial Framework; and
- Certain State aid measures that support the green and digital transition and are also relevant for the recovery from the economic effects of the coronavirus pandemic.
The CJEU accepts the principle of staggered hybrid cartel settlements in Pometon
On 18 March 2021, the Court of Justice of the European Union (“CJEU”) largely dismissed the appeal by Pometon against the General Court’s (“GC”) judgment, which previously partially dismissed Pometon’s appeal against the European Commission (“Commission”) steel abrasives cartel decision.
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