Competition Rules and Code of Conduct
Many industry organisations have therefore voluntarily formed consortia to assist their members in registering their substances in accordance with the REACH legislation.
Industry is expected to ensure that any Consortium is compatible with EU competition law.
The attached text provides the code of conduct:
Part I: Reminder of the EC Treaty provisions
The parties shall not make any agreements concerning coordination of conduct that restrict or affect competition within the meaning of Art. 81 EC Treaty; they shall observe the prohibition of abusing a market-dominating position pursuant to Art. 82 EC Treaty:
- The following shall be prohibited as incompatible with the common market: 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 common market, and in particular those which:
(a) directly or indirectly fix purchase or selling prices or any other trading conditions;
(b) limit or control production, markets, technical development, or investment;
(c) share markets or sources of supply;
(d) apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;
(e) make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.
- Any agreements or decisions prohibited pursuant to this article shall be automatically void.
The provisions of paragraph 1 may, however, be declared inapplicable in the case of:
- any agreement or category of agreements between undertakings,
- any decision or category of decisions by associations of undertakings,
- any concerted practice or category of concerted practices,
which contributes to improving the production or distribution of goods or to promoting technical or economic progress, while allowing consumers a fair share of the resulting benefit, and which does not:
(a) impose on the undertakings concerned restrictions which are not indispensable to the attainment of these objectives;
(b) afford such undertakings the possibility of eliminating competition in respect of a substantial part of the products in question.
Any abuse by one or more undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market in so far as it may affect trade between Member States.
Such abuse may, in particular, consist of:
(a) directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions;
(b) limiting production, markets or technical development to the prejudice of consumers;
(c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;
(d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.
Code of Conduct: a checklist
Part II: Code of Conduct
The parties shall act in compliance with the following checklist:
Application of competition law
Art. 81 and 82 EC Treaty may be applicable to the conclusion of the Preliminary Agreement and activities of the preliminary phase.
Do not assume that conflicts with competition law are excluded simply by the fact that the Agreement complies with the provisions of REACH.
Consultation in Matters of
Consult an in-house legal expert or the compliance officer of your company or an external lawyer whenever there are uncertainties regarding compliance with competition law.
Stop all meetings/discussions which are not in compliance with the Code of Conduct until a legal expert has been involved.
Do not assume that the Code of Conduct deals with all competition law issues exhaustively. Basically, compliance with Art. 81 and 82 EC Treaty can be determined only on the basis of market impact in each individual case. The Code may therefore be regarded only as a means of providing general conduct recommendations.
Activities in the preliminary phase
Restrict cooperation within the scope of the Agreement to the initially defined goals and purposes of the cooperation.
Pursuant to Art. 81 and 82 EC Treaty the following activities are prohibited within the scope of the Preliminary Agreement:
- Coming to arrangements about prices, markets and customers (see Art. 81 paragraph 1 a)-e) EC Treaty);
- Joint boycotting of other companies
- The unjustified unequal treatment of trade partners
- The abusive exploitation of a dominating market position.
Exchange of Confidential Information
Involve a trustee for the exchange of confidential information.
The exchange of confidential information concerning market behaviour is inadmissible; in particular this relates to
- production capacities
- productions or sales volumes
- import volumes
- market shares
- price policy
- distribution and marketing terms
- marketing strategies
- information regarding relationships with suppliers
Documentation on Cooperation
Keep minutes of all meetings which detail the subject of the meeting.
Have the contents of the minutes reviewed by an in-house legal expert or the compliance officer of your company prior to sending them to all parties of the Agreement.
Stop all meetings which are not in compliance with the Code of Conduct until a legal expert has been involved.